COVID-19: AGMs 2020 in Finland

By Mika Puurunen


In this article we have outlined some key considerations in respect of the coronavirus epidemic's impact both on the ongoing AGM season and the disclosure of inside information and financial reporting by public listed companies.

- The Annual General Meeting shall be held within six months of the end of the financial period (assuming Articles of Association do not provide for a shorter time frame). Matters specified in the Finnish Companies Act (624/2006) and Articles of Association of the company shall be handled in the meeting, including the adoption of the company's financial statements.

- If a General Meeting cannot be postponed, the emergency measures restricting the assembly of more than 10 people imposed by the Finnish Government and the Regional State Administrative Agencies shall be taken into account.

o Actual (physical) General Meeting has to be held (the meeting cannot be organised electronically only).

o However, participating to and/or observing the meeting through electronic remote access (e.g. through web broadcast or such) can be arranged. Relevant instructions for such participation and/or observation shall be included to the meeting notice.

o Advance voting and participation through proxy can be used to lower the number of people attending to the meeting. Relevant instructions shall be included to the meeting notice.

- All General Meeting arrangements should take into account the equal treatment of shareholders.

COVID-19 – Disclosure of inside information, profit warnings and forecasts for 2020

- Regardless of the emergency circumstances at hand, normal rules concerning the disclosure of inside information under the EU Market Abuse Regulation (MAR) remain in force, i.e.

o Inside information shall be disclosed to the public as soon as possible after the issuer has become aware of such information (waiting until the next calendar or trading day is generally not allowed).

o Issuer may delay the disclosure provided that (i) immediate disclosure is likely to prejudice the legitimate interests of the issuer, (ii) delaying the disclosure is not likely to be misleading, and (iii) the issuer is able to ensure the confidentiality of the information in question.

- If an issuer has disclosed prospects and profit forecasts for the year 2020 and such prospects and forecasts are no longer probable and valid, a profit warning must be disclosed as soon as possible (issuing profit warnings cannot be delayed in any circumstances)

- Where the prospects and their underlying fundamentals involve significant uncertainties, issuers may also refrain from issuing prospects in order to avoid disclosing misleading information to the market.

- The European Securities and Markets Authority (ESMA) recommends that issuers disclose as soon as possible any relevant significant information concerning the impacts of COVID-19 on their fundamentals, prospects or financial situation in accordance with their transparency obligations under MAR.

COVID-19 – Financial reporting of public listed companies

ESMA has published a recommendation that issuers provide transparency on the actual and potential impacts of COVID-19, to the extent possible based on both a qualitative and quantitative assessment on their business activities, financial situation and economic performance in their 2019 year-end financial report if these have not yet been finalised or otherwise in their interim financial reporting disclosures.