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The Company Act does not include detailed provisions for the conduct of meetings of holders of corporate bonds. To address this lacuna, on 15 February 2005 the Ministry of Economic Affairs issued an interpretation stating that the provi-sions of the Act regarding shareholders’ meet-ings may be applied by analogy (i.e. mutatis mutandis) to bondholders’ meetings, with regard to the following matters:
The Company Act provides that a bondhold-ers’ meeting may be convened by the bond issuing company, by a trustee of a bondholder, or by bondholders that hold 5% or more of the relevant bond issuance. The interpretation states that if a bondholders’ meeting is con-vened by the issuing company, it should be chaired by the company’s chairperson (or a deputy as provided for by the Act); if it is convened by a bondholder’s trustee, it should be chaired by the trustee; and if it is convened by bondholders, the bondholders should elect a chairperson from among themselves.
Any bondholder may attend a bondholders’ meeting and exercise his/her voting rights in person. The interpretation states that the Act’s provisions regarding proxy statements may be applied by analogy: a bondholder may appoint a proxy to attend a meeting by issuing a proxy statement stating the extent of the powers granted; a single bondholder may issue only one proxy statement and may appoint only one proxy; and a proxy statement must be deliv-ered to the company at least five days before the meeting. However, bondholders are not members of the company, and thus do not exercise control over the company by their votes; therefore, if one person is appointed as a proxy by multiple bondholders, his proxy voting rights are not subject to a maximum, and the provision of the Company Act that voting rights exercised by a proxy at a share-holders’ meeting shall not exceed 3% of the company’s total issued shares does not apply.
According to the interpretation, if a bond-holder has a personal interest in a matter to be voted on at a meeting, and there is a likelihood of conflict with the interests of the company, he may not vote on the matter in his own right, nor as a proxy for another bondholder; and no voting rights attach to bonds held by the is-suing company.
The Company Act requires resolutions of a bondholders’ meeting be recorded in minutes that shall be signed by the chairperson. The interpretation states that the provisions of the Company Act regarding the production and safekeeping of the minutes of shareholders’ meetings may be applied by analogy.
The Company Act makes no explicit provision as to whether there are limits on the number of representatives of a bondholder who may at-tend a bondholders’ meeting if the bondholder is the government or a juristic person, or as to how voting rights should be exercised in such cases. According to the interpretation, the number of representatives is not limited to one, but they should exercise the bondholder’s voting rights jointly, and the number of voting rights should be calculated collectively.
According to the interpretation, if a meeting is postponed or adjourned by no more than five days, it is not necessary to convene a new meeting.
