What must public companies do if there is a 'serious loss of capital'?

When a public company experiences a 'serious loss of capital,' it is required to hold a general meeting. This regulatory requirement is in place to ensure that shareholders are informed and involved in significant financial decisions concerning the company. A serious loss of capital typically raises concerns about the company's sustainability and ability to continue operating effectively.

Holding a general meeting allows the board of directors to present the situation to the shareholders, discuss the implications of the capital loss, and explore options for resolving the financial difficulties. It is a vital part of corporate governance and ensures that shareholders have a platform to express their views and, if necessary, take actions that could influence the future direction of the company.

In contrast, while informing shareholders might seem intuitive, it is not a mandated action in the same way that holding a general meeting is. Filing for bankruptcy is generally a last resort and not a direct consequence of capital loss, as companies might explore other means of addressing financial issues first. Conducting an asset appraisal, while potentially useful for internal purposes or future decisions, is not a legal requirement that must occur in response to a serious loss of capital as stipulated in corporate governance regulations.