Introduction to Meetings of Board and its Powers

As improvements to the Companies Act, 2013, The Ministry of Corporate Affairs released a notification on the 31st of March 2014 declaring the Companies (Meetings of Board and its powers) Rules,2014.

The rules indicate guidelines for conducting board meetings, their, frequency, provisions for conducting the meeting through video conferencing and providing notice for meeting among others. All companies have to conduct a board meeting at least once every three months.

The rules set in 2014 also have provisions for guidelines for ensuring safe, secure and uninterrupted arrangements for conducting video conferencing or by any other audio/visual means. In addition to this, the rules also specified the provisions for the following with regards to Board of directors and board meetings.

  • Matters not to be discussed via Video/ Audio-Visual confrencing.
  • Passing of Resolution by circulation.
  • Committees of Board
  • Establishment of Vigil Mechanism
  • Powers of the Board
  • Loans to Directors

To check out the full list of provisions in the original rules, See official notification from MCA.

Amendments to Meetings of Board and its Powers

In a notification released on the 7th of May, 2018, The Ministry made a few amendments to the rules for Board meetings. The new rules basically have provisions for the following:

  • Rule 4 (Matters not to be dealt with in a meeting through video conferencing or other audiovisual means): Directors can attend the board meeting through Video conferencing if there is a Quorum (Minimum amount of members) physically present for the meeting. Usually, this number of minimum members should be one-third of the number of directors of the company.
  • Rule 6(Committees of the Board): The words every listed company are replaced by every listed public company.
  • Rule 13 (Special Resolution) Rule has been modified as follows- 13. Special Resolution.- A resolution passed at a general meeting in term s of sub-section (3) of section 186 to give any loan or guarantee or investment or providing any security or the acquisition under sub-section (2) of section 186 shall specify the total amount up to which the Board of Directors are authorised to give such loan or guarantee, to provide such security or make such acquisition:  Provided that the company shall disclose to the members in the financial statement the full particulars in accordance with the provisions of sub-section (4) of section 186.

You can have a look at the official notification of amendments released by the MCA.

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