The Ultimate Guide: What You Need to Know for a Successful AGM in Serbia
In Serbia, the Annual General Meeting (AGM) is a vital event for all companies, mandated by Article 364 of the Serbian Companies Act. This law requires that the ordinary session of the general meeting be held at least once a year, and no later than six months after the end of the business year.
Convening the AGM
The authority to convene the AGM varies depending on the management structure:
- One-Tier System: The director(s) is authorized to convene the AGM.
- Two-Tier System: The supervisory board is responsible for convening the AGM.
Additionally, members holding at least 10% of the voting rights can request an AGM. If the responsible party fails to convene the meeting within the legal timeframe, the members can convene it themselves.
Notice Requirements
The law mandates that a written invitation for the AGM must be sent to all members at least eight days before the session. The invitation must include essential details like the time, place, agenda, and session materials.
Venue and Conduct of the AGM
The venue for the AGM should comply with the rules set by the company’s Memorandum of Association. Article 209 allows the general meeting to adopt its own rules of procedure, detailing the manner of work and decision-making. The minutes of the meeting must be accurately documented, signed by participants, and maintained as part of the company’s records.
Alternative Methods for Holding the AGM
Serbian law provides flexibility in how AGMs are conducted:
- Virtual Meetings: AGMs can be held via conference calls or other audio-visual means, allowing remote participation.
- Written Resolutions: Decisions can be made in writing, without a physical session, if all members consent.
This flexibility is particularly valuable in today’s digital age, where physical meetings may not always be feasible.
Quorum and Voting
A quorum for the AGM is achieved with a simple majority of votes, unless otherwise specified in the Memorandum of Association. If a quorum is not met, a reconvened meeting with a lower quorum threshold can be held within 30 days. Resolutions are generally passed by a simple majority, though some decisions, such as changes to share capital or legal form, require a two-thirds majority.
Key AGM Agenda Items
The AGM typically addresses critical issues, including:
- Approval of financial statements and auditor’s reports.
- Decisions on profit distribution and loss coverage.
- Appointment and dismissal of directors and supervisory board members.
- Amendments to the memorandum of association.
- Decisions on significant corporate actions like liquidation or bankruptcy.
Shareholders holding at least 5% of the share capital can propose additional agenda items, ensuring their concerns are addressed.
Filing and Disclosure Requirements
Financial statements must be prepared, approved by the AGM, and filed electronically with the Serbian Business Registers Agency. Companies subject to audit must include the auditor’s report in their filings. Failure to hold the AGM or to file financial statements within the legal deadlines can result in significant fines and legal consequences.
Conclusion
The AGM is a cornerstone of corporate governance in Serbia, providing a platform for crucial decision-making and ensuring that companies remain compliant with legal and regulatory requirements. By understanding and adhering to the Serbian Companies Act’s provisions on AGMs, companies can avoid legal pitfalls and maintain the trust of their shareholders and stakeholders.
For further insights, check out our guide titled Ensuring AGM Triumph in Kazakhstan: What You Need to Know for Complete Success. This guide offers strategies for managing AGMs in Kazakhstan, helping companies strengthen their global corporate governance.
