Holding board meetings amid Covid-19

In view of the ongoing pandemic and travel restrictions as a consequence of that, companies cannot hold board meetings as the required quorum cannot be met. Therefore, the Indian Ministry of Corporate Affairs has relaxed certain requirements with regard to physical presence of directors at board meetings (General Circular No. 11/2020).

As a consequence of this temporary amendment, board meetings to be held till 30th June 2020 may be held through video conferencing or other audio-visual means even for considering the following items, which otherwise require presence of the directors in person as per the provisions of the Companies Act, 2013:

approval of the annual financial statements;
approval of the board’s report;
approval of the prospectus;
approval of the matter relating to amalgamation, merger, demerger, acquisition and takeover.

However, companies will have to comply with the requirements laid out under the Companies Act, 2013 for holding board meeting via video conferencing, such as:

presence of minimum quorum;
recording of proceedings at the meeting;
ensuring availability of proper video conferencing or other audio-visual equipment or facilities for providing transmission of the communications for effective participation of the directors and other authorized participants at the Board meeting;
ensuring that participants attending the meeting through audio visual means are able to hear and see the other participants clearly during the course of the meeting;
safekeeping and marking the tape recording(s) or other electronic recording mechanism as part of the records of the company at least before the time of completion of audit of that particular year;
Every participant shall identify himself for the record before speaking on any item of business on the agenda; and
the minutes of the board meeting shall disclose the particulars of the directors who attended the meeting through video conferencing or other audio-visual means.

Also, the mandatory requirement of holding meetings of the Board of the companies within the intervals of 120 days has been extended by a period of 60 days till next two quarters i.e., till 30th September. Accordingly, as a one-time relaxation, the gap between two

consecutive meetings of the Board may extend to 180 days till the next two quarters, instead of 120 days as required in the Companies Act 2013.

General Circular No. 11/2020