Cheyney Goulding

Cheyney Goulding Solicitors

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Tom Marshall

Investment Association signifies disapproval over ‘virtual AGMs’

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Since August 2009, Companies in the UK have been able to hold virtual meetings as a result of the amendment of section 360A of the Companies Act 2006, as inserted by the Shareholder Rights Regulations 2009. It provides for the fully-electronic holding of meetings with no physical presence required. The ability paves the way into digitalisation as to the running of a company and provides the necessarily flexibility to a modern company in adhering to the requirements of the Companies Act 2006.

Jimmy Choo was the Main Market listed company to hold a virtual AGM in 2016, increasing investor access whilst saving investor travel costs, the cost of hiring a venue and gathering the Board together physically. It is recommended that a company’s articles of association are amended in order to facilitate the development, if a company wishes to take advantage of the method.

However, the Investment Association has recently issued a statement as to its position of these virtual AGMs. It states that Investment Association’s members will not support amendments to articles of association that allow for virtual-only AGMs. Furthermore, any amendments should confirm that a physical meeting will be held alongside an electronic meeting.

Their concerns revolve around removal of accountability for board members to shareholders because of the remoteness of the relationship. In addition, the Investment Association believes that virtual AGMs will make it harder for participants to identify other views and register agreement or disagreement, whilst also giving the impression that a board may be wanting to restrict shareholder participation or the ability to answer questions.

You can find the Investment Association’s statement at the following link:

Government gives green light to introduction of fully digital conveyancing

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The Government has announced its intention to modify the Land Registration Rules 2003 in order to facilitate the introduction of fully digital conveyancing.

The Land Registry consulted on the possible changes back in 2017, including the use of digital documents with electronic signatures, and announced on 23 January 2018 that the changes have been approved.

The amended rules, which come into effect on 6 April 2018, allow for registered transfers to be carried out using digital documents and electronic signatures. Identity checks will be carried out using the Government Digital Service in addition to the regular paper checks by the conveyancer. Although this will only be available in relation to some types of transfers initially, it is an important step in the Land Registry’s digital modernisation to make conveyancing simpler, faster and cheaper.

The amended rules have also made provision for online access to historic information about a registered property. This tool will provide a useful way to unravel issues relating to complex titles, and in tracing ownership in contentious cases.

Chief Executive and Chief Land Registrar Graham Farrant said: “Our customers are central to everything we do and we want to make dealing with us quicker and simpler by providing more services through digital technology. These changes are an important enabler for our digital transformation and I want to thank our customers for their positive responses to the consultation.”

The Land Registry advised they will meet their target to digitise and automate 95% of their daily transactions 2022 by “focusing on automating the most straightforward updates and aspects of the complex processes where possible and beneficial. This will save experienced caseworkers from needless copy typing, data entry and repeat administrative work, freeing them to focus on exercising expert judgement on registration applications”.

The Land Registry’s full press announcement can be found here: https://www.gov.uk/government/news/hm-land-registry-moves-forward-with-digital-conveyancing

Stamp Duty Land Tax – Scrapped for first-time buyers

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Chancellor, Phillip Hammond, announced on the 22nd November that stamp duty is to be abolished for first-time buyers on properties up to £300,000 with immediate effect.

The cut will permanently raise the price at which a property becomes liable for stamp duty to £300,000 for first‑time buyers in an attempt to help young people buy their first home.

The Government says 95% of first-time buyers that pay stamp duty will benefit to some extent, and 80% of first-time buyers will pay no stamp duty at all. The Treasury says the change will save purchasers up to £5,000.

Mr Hammond said: “It takes too long to save for a deposit and rent absorbs too much of the monthly budget.”

But some experts have warned that the cut for first-time buyers could push up property prices. A spokesperson for the Office for Budget Responsibility said: “We estimate that the Stamp Duty relief will increase house prices by 0.3 per cent”.