Annual Report hard copies – is it exempted for 2022 ?? - MMJC

Background

The Ministry of Corporate Affairs (MCA) has permitted holding of Annual General Meeting (AGM) through electronic mode till 31 December 2022. This relaxation includes a leeway from sending hard copies of annual reports. But a question arises that whether listed entities are exempted from sending hard copies of annual reports for FY22 based on this MCA relaxation or if any specific relaxation is needed under LODR too???

Relaxation for listed entities during Covid:

Listed entities which were companies were covered under the above exemption granted by MCA. Consequentially SEBI, vide its Circular dated 12 May 2020 had relaxed the below requirements under LODR in the case of equity listed entities and entities which have listed their non-convertible securities:-

• Sending of hard copies of the abridged annual report to shareholders who have not registered their email addresses and hard copies of the full annual report for those who request for the same under Reg 36(1)(b) & (c) and Reg 58(1)(b) & (c).
• Sending proxy forms under Regulation 44(4) for in case of AGM / EGM held through electronic mode only

This exemption was for the listed entities conducting their AGMs till 31 December 2020. Thereafter following the extension given by MCA for holding AGM / EGM by VC or OAVM in 2021, SEBI had, vide its Circular dated 15 January 2021, extended the above relaxations until 31 December 2021

Scenario in 2022:

As mentioned above, MCA has extended the relaxation for holding AGM / EGM by VC or OAVM as per the framework laid down in this regard by the said MCA Circulars, specifically as per MCA Circular dated 5 May 2020, there is an exemption from sending physical annual reports for all companies conducting AGM by VC / OAVM till 31 December 2022. Earlier MCA had extended this relaxation till AGM / EGM / postal ballot to be held till 30 June 2022 vide it’s Circular dated 8 December 2021. However, there is no relaxation from SEBI in this regard for the shareholders meeting in 2022 from 1 January 2022 till date.

Actionable for listed entities for AGM in FY 22:

As per the relaxation given by MCA, listed entities may convene their AGMs in the year 2022 through electronic mode only. However, unless specific relaxation is given by SEBI, listed entities will have to send hard copies of annual reports to those shareholders who have not registered their email addresses and those who request for the same!!!