Louisiana Senate Bill SB33

Louisiana 2020 2nd Special Session

• Introduced: 9/29/20
• Refer: 9/29/20
• Report Pass: 9/30/20
• Engrossed: 10/2/20
• Report Pass: 10/5/20
• Enrolled: 10/12/20
• Chaptered: 10/16/20
• Passed: 10/16/20

Caption

Provides for revisions to the Business Corporation Act relative to virtual shareholder meetings and mergers. (gov sig) (Item #53)

Impact

By allowing meetings to be conducted solely online, the bill potentially transforms traditional corporate practices, addressing the needs of increasingly digital business environments. It streamlines procedures for corporate restructuring, as it also modifies merger regulations between parent companies and their subsidiaries by relaxing requirements surrounding shareholder approvals and articles of incorporation amendments. This adaptation is particularly significant for large corporations, enabling them to operate more efficiently while navigating mergers and corporate changes.

Summary

Senate Bill No. 33 focuses on revisions to the Business Corporation Act in Louisiana, particularly emphasizing the modernization of corporate governance practices. The bill permits the holding of annual and special shareholders' meetings exclusively via remote communication. This change caters to the growing trend of virtual interactions and aims to simplify the involvement of shareholders, regardless of their location, in corporate decision-making processes. It reflects a broader move towards enhancing accessibility and convenience for corporate stakeholders in the state.

Sentiment

The sentiment surrounding SB33 appears to be generally favorable among business communities and corporate stakeholders, who appreciate the flexibility and operational advantages provided by remote meetings. However, there are underlying concerns about the implications for shareholder empowerment and transparency, as the shift towards virtual meetings could dilute engagement opportunities for some shareholders. Opponents might also argue that the new regulations could potentially lead to less oversight and accountability in corporate governance.

Contention

Notable points of contention include the balance between efficiency and shareholder rights. Critics of the bill may express apprehensions that allowing remote-only meetings may disenfranchise some shareholders, particularly those who may not have easy access to technology or are less comfortable with virtual communication. There is also debate over the reduced requirement for shareholder involvement in mergers, raising concerns about adequate checks and balances in corporate governance that are necessary to protect minority shareholders.