Company Law Being Modernized

Two pieces of legislation, one of them dating back to 1914, are being modernized and consolidated into one comprehensive law.  They are the Companies Act Chapter 250 and the International Business Companies Act, which governs offshore business.  Minister of State in the Ministry of Finance, Chris Coye, explained to News Five that under the new law, where shareholders are unfairly prejudiced, they will have a right of action before the Court. Currently, if a shareholder wants to investigate the affairs of a company, they have to hold ten percent of the company’s shares in order to be eligible to make an application to the Court.

Chris Coye, Minister of State, Finance

“It will be certainly a far more flexible, permissive and far more innovative legislation than what we have had before. It recognizes the change in times.  We’ll be able to hold and conduct meetings, whether shareholder meetings or directors’ meetings electronically. I don’t know if you’ve noticed some of the public companies like B.E.L. and B.T.L., they’ve had their struggles in trying to make sure they conduct proper meetings under the existing laws, whether trying to amend the articles to enable proxy appointments to be able to hold quorum in in-person meetings. With this new law, certainly that won’t be a problem anymore because it will recognize electronic attendance and would have quorum through that means electronically. So that’s just one of the provisions that will exist in the new Companies Law, but beyond that, the intent is also to simplify the process of starting a business, the process of incorporating less requirements and in a more practical way. Beyond that there are other provisions as well that look at introducing minority shareholder rights protection provision that really existed in a limited way in our existing Companies law and so this will be significantly enhanced in this new Companies Law.”