Annual General Meetings in China: Compliance and Best Practices

Annual General Meetings (AGMs) are vital to maintaining corporate governance in China. They ensure transparency, legal compliance, and active engagement between companies and their shareholders. This guide outlines the key legal requirements, procedures, and best practices for holding an AGM under Chinese law.

Legal Mandate and Timing

Under Article 101 of the Company Law, every company must hold at least one AGM each year. Although no specific date is required, scheduling it annually remains essential for compliance. Missing this obligation can result in penalties or legal action.

In urgent situations—such as when director numbers fall below statutory limits or major financial losses occur—an interim general meeting must be held within two months. This allows companies to address urgent governance or financial issues without delay.

Rescheduling and Consequences of Non-Compliance

If the board fails to convene the AGM on time, Article 110 allows shareholders to take legal steps to compel it. Ignoring AGM obligations or convening improperly may trigger administrative penalties from the Ministry of Commerce or the local Administration for Market Regulation (AMR).

Beyond regulatory risks, missing an AGM can damage corporate credibility and disrupt decision-making. Financial approvals, board elections, and key filings could all be delayed, affecting both compliance and stakeholder confidence.

Notice and Agenda

According to Article 102, the board of directors must notify shareholders at least 20 days before an AGM, or 15 days before an interim meeting. The notice must include the agenda, resolutions, and supporting documentation so shareholders can prepare.

If the board fails to fulfil this duty, shareholders owning at least 10% of shares, or the board of supervisors, may convene the meeting themselves.

Meeting Formats and Participation Options

Chinese law recognises several valid AGM formats:

Physical meetings: Traditional in-person gatherings at the company’s headquarters.
Virtual meetings: Permitted when the Articles of Association allow it, enabling remote participation via video conference.
Written resolutions: Valid only with unanimous shareholder consent, allowing swift decisions without a formal meeting.
Hybrid meetings: Combining both in-person and remote attendance for greater flexibility.

Regardless of the format, companies must ensure that shareholders can participate, vote, and ask questions. Transparency and accessibility remain central principles of corporate governance.

Quorum and Voting

Under Article 104, the AGM requires more than 50% of voting rights to be represented, either in person or by proxy. Each share equals one vote. Most resolutions pass by a simple majority, though significant matters—such as mergers or liquidations—demand a two-thirds majority.

Proxy Appointments

Per Article 107, shareholders unable to attend may appoint proxies through a written power of attorney. Proxy forms must be submitted 24 to 48 hours before the meeting and may include specific voting instructions. If no instructions are given, the proxy may vote at their discretion.

Core AGM Agenda Items

Article 38 outlines the main agenda points for shareholder consideration, including:

• Approving business strategies and investment plans

• Electing or replacing directors and supervisors

• Reviewing board and supervisory reports

• Approving budgets and financial statements

• Deciding on profit distribution or loss coverage

• Amending registered capital, bond issuance, or the Articles of Association

• Considering mergers, dissolutions, or liquidations

Shareholders with significant holdings may also submit additional proposals for inclusion.

Financial Statements and Audit Obligations

According to Article 178, companies must present their financial statements—including the balance sheet and profit-and-loss statement—20 days before the AGM. Article 163 further requires these statements to be audited by an independent statutory body, ensuring compliance with Chinese Accounting Standards (CAS) or International Financial Reporting Standards (IFRS).

The audit report should reflect the company’s true financial position and reinforce shareholder confidence in management performance.

Documentation and Archiving

AGM minutes must capture all key details: the meeting date, agenda, attendance, discussions, and results. These records should be signed by the chairperson and retained for at least 10 years.

Listed companies have additional obligations to file reports with the China Securities Regulatory Commission (CSRC) and relevant stock exchanges to maintain public transparency.

Filing Financial Statements

After approval at the AGM, financial statements must be filed with the competent authorities. Private companies must submit by 31 May, while public companies file by 30 April. Public companies are also required to disclose AGM outcomes and financial data to the CSRC and relevant exchanges.

Corporate Changes and Effective Dates

Corporate actions such as board appointments, capital increases, or AoA amendments generally take effect upon shareholder approval. However, changes that require registration become effective once filed with the AMR or other authorities.

Dividend Distribution

The board of directors typically proposes dividends based on annual results. These are subject to shareholder approval at the AGM and, for listed entities, must be disclosed through the CSRC and stock exchange announcements.

Key Takeaways

Managing AGMs in China demands careful adherence to legal frameworks and transparent communication with shareholders. Compliance with timing, notice, and reporting obligations strengthens corporate integrity and prevents regulatory issues.

With deep experience across multiple jurisdictions, Klea supports companies in managing AGMs efficiently while ensuring full compliance with Chinese law.

What’s Next for Klea

Conducting an Annual General Meeting in China requires precise planning, strict timing, and complete documentation. For more insights into AGM procedures in other jurisdictions, explore our article AGMs in Switzerland: Legal Rules and Digital Trends.

Klea transforms entity management by offering centralised governance, automated compliance, and secure collaboration tools. For this reason, businesses seeking efficient, cross-border AGM management can take the following actions:

• Request a Demo – See how Klea simplifies global AGM coordination.
• Start a Trial – Experience how automation supports compliance and reduces manual workload.
• Talk to Our Experts – Get personalised guidance on international AGM management.

Company secretarial software solutions are essential for organisations that require consistent compliance, structured governance, and accurate legal oversight. With Klea, companies can maintain transparency, efficiency, and trust in every jurisdiction.

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For specific legal or compliance support tailored to your business needs, please contact Klea directly. Our team provides personalised guidance and expert solutions. Any reliance on general content without direct consultation does not establish any legal responsibility or liability on Klea’s part.