Chapter II-2 Shareholders' Meetings With Video Conferencing |
| Article 44-9 | Shareholders' meetings with video conferencing are divided into the following two types:
- Hybrid shareholders' meeting: means the company convenes a physical shareholders' meeting with the assistance of video conferencing, and shareholders may choose to take part in the shareholders' meeting physically or by means of video conference.
- Virtual-only shareholders' meeting: means the company does not convene a physical shareholders' meeting, and convenes the meeting only by video, and shareholders may attend the shareholders' meeting only by means of video conferencing.
A shareholder taking part in a shareholders' meeting by video conference shall be deemed to have attended in person.
Unless otherwise provided in these Regulations, a company that will convene a shareholders' meeting with video conferencing shall expressly provide for such meetings in its Articles of Incorporation and obtain a resolution of its board of directors. Furthermore, convening of a virtual-only shareholders' meeting shall require a resolution adopted by a majority vote at a meeting of the board of directors attended by at least two-thirds of the total number of directors.
If a company will convene a hybrid shareholders' meeting within 1 year from the date of issuance of the 4 March 2022 amendments to these Regulations, and it has not yet made express provision in its Articles of Incorporation permitting the convening of shareholders' meetings with video conferencing, it shall obtain approval by a majority vote of the directors in attendance at a board of directors meeting attended by two-thirds or more of the directors before proceeding to convene the meeting.
If, due to a natural disaster, unforeseen event, or other force majeure event, the Ministry of Economic Affairs announces that within a certain period of time companies may hold their shareholders' meetings by means of video conferencing, companies may be exempted during that period from the requirement of express provision in their Articles of Incorporation under paragraph 3.
When an event occurs as announced by the Ministry of Economic Affairs under the preceding paragraph, and a company will hold a shareholders' meeting with video conferencing as resolved by its board of directors, it may do as follows:
- If the company is changing the method for convening the shareholders' meeting and has already mailed the shareholders' meeting notice or transmitted it via electronic document, it may give notice of the change of method for convening the shareholders' meeting on the information reporting website designated by this Commission.
- If a company convenes a virtual-only shareholders' meeting and provides alternative measures for shareholders who would have difficulty attending the shareholders' meeting by means of video conferencing to exercise their voting rights in writing, any shareholder who wishes to exercise their voting rights in writing shall first submit an application to the company, and the provisions of Article 5, paragraph 2 of the Regulations Governing Content and Compliance Requirements for Shareholders' Meeting Agenda Handbooks of Public Companies regarding additionally sending materials to the shareholders will not apply.
- Other necessary emergency measures as prescribed by this Commission.
If a shareholders' meeting with video conferencing is convened by any person with convening rights other than the board of directors, the provisions of this chapter shall apply mutatis mutandis, and the convening of the meeting may be exempted from the requirement of express provision in the Articles of Incorporation under paragraph 3.
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| Article 44-10 | When a company convenes a shareholders' meeting with video conferencing, it shall outsource the video conferencing related matters.
Entities engaged to handle the video conferencing related matters under the preceding paragraph shall be limited to shareholder services agents under Article 3, paragraph 1 or the centralized securities depository enterprise, and shall meet the following requirements:
- Have at least three dedicated information professionals.
- The video conferencing platform shall be equipped with functions for shareholder registration, registration for participation in video conferencing, sign-in, watching of live broadcast, asking questions, voting, counting votes, and information disclosure, as well as identification and security mechanisms for shareholders exercising voting rights, and shall have obtained documentation of certification under an international standard of information security management.
- The video conferencing platform shall be equipped with on-site and remote backup mechanisms.
- When the video conferencing platform involves the collection, processing, use, or international transmission of personal data, the company shall formulate a security plan for personal data protection and provide documentation of personal data protection related certification.
The entity engaged to handle video conferencing matters shall formulate an information security management policy and report it, together with the relevant documents proving qualification under the preceding paragraph, to this Commission for recordation, before it may begin to handle video conferencing related matters.
An entity that has already been engaged to handle video conferencing matters prior to the issuance of the 4 March 2022 amendments to these Regulations shall report to this Commission for recordation under the preceding paragraph within 6 months from the date of issuance of the amendments to these Regulations. An entity that fails to complete recordation by that deadline may not accept any engagement to handle video conferencing matters.
An entity engaged to handle video conferencing matters shall every year report the audit results of the certification of compliance with the international standard of information security management under paragraph 2, subparagraph 2 to this Commission for recordation.
An entity engaged to handle video conferencing matters may not simultaneously, for the same company, accept engagement to handle shareholder services matters or serve as a shareholders' meeting proxy solicitor, proxy agent, or person engaged to handle proxy solicitation matters.
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| Article 44-11 | To hold a virtual-only shareholders' meeting, a company shall meet the following conditions with respect to the meeting:
- There will be no proposal at the shareholders' meeting for election of directors or supervisors.
- There will be no proposal at the shareholders' meeting for discharge of a director or supervisor.
- There will be no proposal at the shareholders' meeting under Article 185 or 316 of the Company Act, Article 18, 27, 29, or 35 of the Business Mergers And Acquisitions Act, or Article 24, paragraph 2, subparagraph 1, or Article 26, paragraph 2, subparagraph 1 of the Financial Holding Company Act.
- If the company's stock is neither listed on the stock exchange nor traded on the OTC market, it shall handle its shareholder services through outsourcing to a professional shareholder services agency.
To hold a hybrid shareholders' meeting, a company shall meet the following conditions with respect to the meeting:
- There will be no proposal at the shareholders' meeting for election of directors or supervisors, or if there is a proposal for election of directors or supervisors, the number of candidates does not exceed the number of seats to be filled in the election.
- There will be no proposal at the shareholders' meeting for discharge of a director or supervisor.
- If the company's stock is neither listed on the stock exchange nor traded on the OTC market, it shall handle its shareholder services through outsourcing to a professional shareholder services agency.
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| Article 44-12 | When a company will convene a shareholders' meeting with video conferencing, if a shareholder has engaged a proxy to attend the shareholders' meeting, the shareholder may not then attend the shareholders' meeting unless otherwise provided in these Regulations or the Company Act.
When a shareholder engages a proxy agent to attend a shareholders' meeting, if, after the service of the power of attorney of the proxy to the company, the shareholder issuing the proxy intends to take part in the shareholders' meeting by video conference, the shareholder shall issue a proxy rescission notice to the company by 2 days prior to the scheduled date of the shareholders’ meeting. In the absence of a timely rescission, the voting power exercised by the authorized proxy agent at the meeting shall prevail.
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| Article 44-13 | When a company will convene a shareholders' meeting with video conferencing, if a shareholder, proxy solicitor, or proxy agent intends to take part in the meeting by video conferencing, they shall register with the company by 2 days prior to the scheduled meeting date of the shareholders' meeting.
When a company will convene a hybrid shareholders' meeting, if a shareholder, proxy solicitor, or proxy agent who has registered to take part in the meeting by video conferencing intends to attend the physical shareholders' meeting in person, they shall, by 2 days prior to the scheduled date of the shareholders' meeting and in the same manner previously used to register, rescind the registration. In the absence of a timely rescission, they may take part in the shareholders' meeting only by means of video conferencing.
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| Article 44-14 | When a company will convene a shareholders' meeting with video conferencing, if a shareholder who has exercised their voting rights in writing or by electronic means intends to take part in the shareholders' meeting by video conference, the shareholder shall, by 2 days prior to the scheduled date of the shareholders' meeting and in the same manner previously used in exercising their voting rights, rescind the previous declaration of intention made in the aforesaid previous exercise of voting rights. In the absence of a timely rescission, the voting power exercised in writing or by electronic means shall prevail.
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| Article 44-15 | When a company will convene a shareholders' meeting with video conferencing, the company or its shareholder services agent shall duly compile a statistical statement of the number of shares obtained by the proxy solicitor through solicitation, the number of shares represented by proxy agents, and the number of shares represented by shareholders attending the meeting in person or by electronic means, and shall disclose the statement on the video conferencing platform before the convening of the shareholders' meeting.
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| Article 44-16 | Only after a shareholder, proxy solicitor, or proxy agent that has registered with the company to take part by means of videoconferencing has logged into the video conferencing platform and completed sign-in may the shares they represent be counted in the total number of shares and the number of voting rights of the shareholders in attendance at the shareholders' meeting. Unless otherwise provided by these Regulations or the Company Act, they then may watch the direct broadcast of the shareholders' meeting, raise questions, vote, and submit extemporary proposals or propose amendments to the contents of the original proposals.
If a shareholder has exercised voting rights in writing or by electronic means, and has not rescinded their declaration of intention, if they then take part in the shareholders' meeting by videoconferencing, they may not, with the exception of on extemporary proposals, further exercise any voting rights on the original proposals or propose any amendments to the original proposals or exercise voting rights on or propose amendments to the original proposals.
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| Article 44-17 | When a company convenes a shareholders' meeting with video conferencing, when the meeting is called to order, the total number of shares represented by shareholders attending the meeting shall be disclosed on the video conferencing platform. The same shall apply whenever a new tally of the total number of shares represented at the meeting and the number of voting rights thereof is made during the meeting.
When a shareholders' meeting of the company is called to order, a voting function shall simultaneously be provided for shareholders, proxy solicitors, or proxy agents taking party by video conferencing, and notice shall be given of the following matters:
- Those taking part by video conferencing shall cast votes on proposals and elections through the video conferencing platform, and shall complete the casting of their votes before the chair announces the close of voting, or will be deemed to have abstained from voting.
- Votes shall be counted at once after the chair announces the close of voting, and the results of votes and elections shall be announced immediately.
- Questions on individual proposals may be raised by inputting them through the video conferencing platform. A participant may not raise more than two questions on any single proposal, and each question raised may not exceed 200 words.
During the meeting period of a virtual-only shareholders' meeting convened by a company, the meeting chair and secretary shall be at the same location within the country.
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| Article 44-18 | When a company convenes a shareholders' meeting with video conferencing, when a shareholder, proxy solicitor, or proxy agent, through the video conferencing platform, before the chair announces the close of voting, casts a vote on any proposal and casts a vote on any election, their declaration of intention shall be deemed to have been served on the company. If no declaration of intention is made, it shall be deemed a waiver of the voting right.
When a shareholder, proxy solicitor, or proxy agent, through the video conferencing platform, before the chair announces the close of voting, amends their declaration of intention with respect to a vote they have already cast, they shall be deemed to have rescinded the previous declaration of intention, and the amended declaration of intention shall prevail.
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| Article 44-19 | When a company convenes a shareholders' meeting with video conferencing, after the procedures for the tallying of votes have been completed for each proposal and election, the results of the voting and the names of those who have been elected, and the names of those who have not been elected, as directors and supervisors (including the numbers of votes cast on the proposals and in the elections), and shall record them in the meeting minutes and immediately upload them to the video conferencing platform.
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| Article 44-20 | When a company will convene a shareholders' meeting with video conferencing, if due to circumstances of a natural disaster, unforeseen event, or other force majeure event, any disruption occurs in the video conferencing platform or in participation by means of video conferencing, such that the meeting cannot be convened or cannot continue, then unless otherwise provided by these Regulations, the company shall postpone the meeting for not more than, or reconvene the meeting within, 5 days, and Article 182 of the Company Act shall not apply.
When a company postpones or reconvenes a meeting under the preceding paragraph, shareholders who did not register to take part by video conferencing in the originally scheduled shareholders' meeting by video conferencing may not take part by video conferencing in the postponed or reconvened meeting.
When a company postpones or reconvenes a meeting under paragraph 1, shareholders, proxy solicitors, or proxy agents who registered to take part by video conferencing in the originally scheduled shareholders' meeting and completed sign-in, but do not participate in the postponed or reconvened meeting, the number of shares represented by them and voting rights and election rights exercised by them shall be counted toward the total number of shares, number of voting rights and number of election rights of shareholders represented at the postponed or reconvened meeting.
When inability to continue video conferencing as set out in paragraph 1 occurs at a hybrid shareholders' meeting convened by the company, if the total number of shares represented at the shareholders' meeting after deduction of the number of shares represented through attendance by video conferencing still reaches the legal quorum for convening of the shareholders' meeting, the shareholders' meeting shall continue in session, without need to postpone or reconvene the meeting as set out in paragraph 1.
When it occurs that a shareholders' meeting shall continue in session as set out in the preceding paragraph, the number of shares represented by the shareholders, proxy solicitors, or proxy agents who were attending the shareholders' meeting by video conferencing shall be counted toward the total number of shares represented by the shareholders attending the meeting, but they shall be deemed to have waived their voting rights on all proposals at that shareholders' meeting.
When a company postpones or reconvenes a shareholders' meeting as set out in paragraph 1, no redundant discussion or resolution is required for proposals, or for lists of elected directors and supervisors, for which the votes have already been cast and counted and the results have been announced.
When a company postpones a meeting for not more than, or reconvenes the meeting within, 5 days as set out in paragraph 1, the time periods set out in the following provisions of laws and regulations shall not change, and the company shall do the matters set out in the provisions based on the originally scheduled date of the shareholders' meeting and the content of the respective provisions: Article 165 paragraph 3, Article 172 paragraph 3, Article 172-1, Article 177 paragraphs 3 and 4, Article 177-2 paragraphs 1 and 2, Article 177-3 paragraph 2, Article 192-1, and Article 216-1 of the Company Act; Article 41, Article 44-3, Article 44-5 paragraph 1, and Article 44-6 of these Regulations, Article 7, the forepart of Article 12, Article 13 paragraph 1, and Article 13-1 of the Regulations Governing the Use of Proxies for Attendance at Shareholder Meetings of Public Companies; Article 23 of the Regulations Governing Information to be Published in Annual Reports of Public Companies; Article 5 and Article 6 of the Regulations Governing Content and Compliance Requirements for Shareholders' Meeting Agenda Handbooks of Public Companies; and Article 4 and Article 6 paragraph 2 of the Regulations Governing the Operation of and Compliance Requirements for Split Voting by Shareholders of Public Companies.
With respect to the time periods set out in the following provisions, the company shall perform the matters provided for therein based on the date of the shareholders' meeting as postponed or reconvened under paragraph 1 herein: the latter part of Article 12, and Article 13 paragraph 3, of the Regulations Governing the Use of Proxies for Attendance at Shareholder Meetings of Public Companies; Article 44-5 paragraph 2, Article 44-15, and Article 44-17 paragraph 1 of these Regulations.
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| Article 44-21 | When a company will convene a shareholders' meeting with video conferencing, it shall specify the following matters in the shareholders' meeting notice:
- The means for shareholders to take part in the video conferencing and exercise their rights.
- Measures to be taken if, due to circumstances of a natural disaster, unforeseen event, or other force majeure event, any disruption occurs in the video conferencing platform or in participation by means of video conferencing, including at least the following particulars:
- To what time the meeting is postponed or from what time the meeting will resume if the above disruption continues and cannot be eliminated, and the date to which the meeting is postponed or on which the meeting will resume.
- Shareholders that have not registered to take part by video conference in the originally scheduled shareholders' meeting may not take part by video conference in the postponed or reconvened meeting.
- When the company convenes a hybrid shareholders meeting, if the virtual meeting cannot be continued, then if the total number of shares represented at the meeting, after deducting those represented by shareholders attending the shareholders meeting by video conferencing, meets the legal quorum for holding a shareholder meeting, the shareholders meeting shall continue in session. The number of shares represented by the shareholders, proxy solicitors, or proxy agents who were attending the shareholders' meeting by video conferencing shall be counted toward the total number of shares represented by the shareholders attending the meeting, but they shall be deemed to have waived their voting rights on all proposals at that shareholders' meeting.
- Measures to be taken if the outcome of all proposals have been announced but extemporary motions have not yet been proceeded with.
- When the company convenes a virtual-only shareholders' meeting, it furthermore shall specify appropriate alternative measures available to shareholders who have difficulty taking part in a virtual shareholders' meeting. Except in the circumstances set out in Article 44-9, paragraph 6, it shall at least provide the shareholders with connection facilities and necessary assistance, and specify the period during which shareholders may apply to the company and other related matters requiring attention.
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| Article 44-22 | When a company will convene a shareholders' meeting with video conferencing, the minutes of the meeting, in addition to recording the information required under Article 183, paragraph 4 of the Company Act, shall furthermore record the starting and ending time of the shareholders' meeting, the method by which the meeting is convened, the names of the chair and the secretary, and the measures taken in the event of any disruption in the video conferencing platform or participation by video conferencing due to natural disaster, unforeseen event, or other force majeure event, and the outcome of the handling of such disruption.
When the company convenes a virtual-only shareholders' meeting, in addition to complying with the requirements in the preceding paragraph, the company shall specify in the meeting minutes the alternative measures made available to shareholders who have difficulty taking part in the shareholders' meeting.
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| Article 44-23 | When a company will convene a shareholders' meeting with video conferencing, it shall keep and preserve records of information on matters including shareholder registration, registration for participation in video conferencing, sign-in, raising of questions, voting, and the results of the votes counted by the company, and continuously audio and video record, without interruption, the proceedings of the video conference from beginning to end.
The information and audio and video recording under the preceding paragraph shall be properly kept by the company during the entirety of its existence, and copies of the audio and video recording shall be provided to and kept by the entity engaged to handle video conferencing matters.
After the shareholders' meeting, the entity engaged to handle video conferencing matters shall keep the information and audio and video recording under paragraph 1 for the periods as provided below:
- The information on shareholder registration, registration for participation in video conferencing, sign-in, raising of questions, voting, and the results of the votes counted by the company shall be kept for at least 3 years. If, however, a shareholder brings an action pursuant to Article 189 of the Company Act, the information shall be kept until the conclusion of the action.
- The audio and video recording of the video conference provided by the company shall be kept for at least 1 year. If, however, a shareholder brings an action pursuant to Article 189 of the Company Act, the information shall be kept until the conclusion of the action.
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