General assembly meetings, quorum and minutes
The general assembly meeting is where the highest body in the company exercises the powers article 102 of Companies Law No. 21 of 1997, as amended, enumerates: discussing the reports of management, the managing director and the auditor; approving the accounts; appointing the auditor in private companies; electing and removing members of the board in a joint-stock company; and matters connected with amending the contract where that applies. The frame is on company registration. Yearly accounts are a connected path on yearly filings. Amending the contract is on its page.
In a sole proprietorship, and in a limited company owned by one person, the owner stands in place of the general assembly, and the provisions of the Law apply to that owner except those that concern meetings, under article 101.
How often the body meets, and how it is called
The general assembly of a joint-stock company meets at least once in each year, and that of other companies at least once every six months, under article 86. The founders meet within thirty days of the issue of the certificate of incorporation, under article 87. If they fail to do so, the Registrar may fix the place and date and issue the invitation himself.
In a joint-stock company the invitation is given by an announcement in the bulletin, in two daily newspapers, and on the Baghdad Stock Exchange. In other companies it is given by registered letters to the addresses of the members in the members' register, or by notifying them at the company's management office. The invitation states the place and time of the meeting, and no fewer than fifteen days may elapse between the date of the invitation and the date of the meeting, under article 88. The invitation must include an agenda. The agenda is not departed from during the meeting except on the conditions article 89 sets, with the exception of the matters in article 92, second paragraph.
If the founders of a joint-stock company, or the chairman of its board, or the managing director in other companies, fail to issue the invitation on the date prescribed by law, the Registrar fixes the place and date and issues the invitation directly, under article 88, second paragraph. Meetings are held at the principal office, or at another place in Iraq if circumstances require it, under article 90.
Quorum, the chair, and voting
The quorum of the meeting, and the majorities for a decision — especially when the subject is an amendment of the contract, a change of capital, a sale of more than half the assets in a transaction outside the ordinary activity, a merger, a transformation, or a liquidation — are read from articles 92 and 98 according to the type of company. In a joint-stock company the majority is that of the holders of subscribed shares whose instalments then due have been paid, unless the contract requires a higher proportion. In a limited company it is that of the shares paid up on the date of the invitation. In a general partnership it is unanimity. If the votes in a limited company are equal, or unanimity in a partnership cannot be reached, the text allows the matter to be taken to a court, without naming that court.
The meeting is opened under the chair of the chairman of the board, or of the founders' committee, in a joint-stock company, and of the managing director in other companies, until a chair of the general assembly is elected. The person chairing the meeting chooses a secretary to record the proceedings and one or more tellers to count the quorum and the votes. The quorum is counted after thirty minutes from the appointed time, under article 95. In a joint-stock company, delegates of the Registrar and a majority of the board must attend. If they do not attend after being notified, the meeting is held half an hour later in their absence, and the Registrar's delegate withdraws once the quorum is confirmed, unless a shareholder asks that delegate to remain, under article 93.
In a joint-stock or limited company each shareholder has as many votes as shares held. In a general partnership votes are counted in proportion to the share, under article 97. A member may appoint another person, under a certified power of attorney, to attend, discuss and vote, or may appoint another member as substitute, under article 91. Powers of attorney and substitutions are deposited with the Securities Commission at least three days before the appointed time, within the limits the text sets, and remain effective for any second meeting to which the first is adjourned. The detail of a power of attorney in company dealings is on its page.
The minutes, sending of decisions, and a challenge
A record is entered in a special register summarising the discussions, proposals and decisions, with dissenting views noted. It is signed by the chair of the general assembly, the secretary, the teller, and the Registrar's delegate if present, sealed with the company seal, and a copy is sent to the Registrar, under article 96. The decisions themselves are entered in a special register, sealed, and signed by the chair. The decisions of the general assembly are sent to the Registrar within seven days of being taken, and a copy certified by the Registrar is a document that may be presented to any party, under article 99.
Any member may challenge before the Registrar the regularity of the steps from the date of the invitation to the issue of the decisions, within three days of the end of the meeting. The Registrar must decide within seven days, set those steps aside if they are contrary to the Law, and require the company to take them again. The Registrar's decision on that challenge is final, under article 96, third paragraph. An objection to the decisions themselves, by five per cent of the members, within seven days, the Registrar's decision within fifteen days, and then a challenge before the Court of First Instance, is the path in article 100, and is set out on the partners' disputes page.
The Law Office of Ali Barakat follows this reading of the meeting from Baghdad, al-Yarmouk.
Legal basis and sources
Frequently asked questions
How often does the general assembly meet in a year?
In a joint-stock company at least once in each year, and in other companies at least once every six months, under article 86, in addition to the founders' meeting within thirty days of the certificate under article 87, and any meeting that a decision in the limits of the text requires.
Do internal minutes suffice without being sent to the Registrar?
No. Article 96 requires a copy of the minutes to be sent to the Registrar, and article 99 requires the decisions to be sent within seven days of being taken. The copy certified by the Registrar is the document that may be presented to any party.
How does a member challenge the regularity of the invitation, or the decision itself?
A challenge to the regularity of the steps from the invitation to the issue of the decisions is made before the Registrar within three days of the end of the meeting, under article 96, third paragraph. An objection to the decisions themselves, by five per cent of the members, is the path in article 100 before the Registrar and then the Court of First Instance, and is read on the partners' disputes page.
Related topics and articles
- 01Obligations that recur after a company is recordedFinal accounts, the audit, the general-assembly meeting and copies sent to the Registrar, distinct from post-incorporation steps and from branch duties.
- 02Amending the company contract, changing the managing director and transferring sharesAmending the company contract, changing the managing director and transferring shares under Companies Law No. 21 of 1997 as amended.
- 03Partner disputes, a request for liquidation, and a challenge to general-assembly decisionsPartner disputes: causes of liquidation, and a 5% objection to general-assembly decisions before the Registrar and then the Court of First Instance.
- 04The address of a company or branch, a lease and a title deedThe company's address in its contract, before the Registrar and in the commercial register; a lease or deed may evidence it. Not a real-estate page.
- 05Registering a company in Basra: which department is approached, and what differs from Baghdad?Registering a company when dealing in Basra under the federal Companies Law, followed from Baghdad.