The minute is the evidence.

A holding company in a register jurisdiction has a board, and the board decides: to buy the parcel, to borrow, to grant the security, to approve the related-party contract, to distribute. Each decision was taken by people in a room or on a call, and the decision's existence afterwards, to the regulator that inspects, the buyer that diligences, the lender that enforces, the tax authority that asks where the company is managed, and the court that hears the dispute, is the minute. Not the decision; the minute. A decision without a minute is a recollection, and a recollection is evidence of what the witness remembers. A structure's governance, across the fund, the holding chain and the onshore vehicles, is the set of minutes that show who decided what, on what papers, with which conflicts declared, where and when, and a structure whose minutes are thin has governance that is thin wherever it is tested.

This note sets out what a minute is and what it is not, the five things it shows, the board that sits and the board that signs, the place of the meeting and the residence question, the papers and their attachment, the conflict declared, the written resolution, the minute across the chain, the minute the buyer reads, the minute the regulator reads, the minute the court reads, the minute's keeper and period, a comparison, a worked set of minutes as a type, cases, what each party holds, the sequence, questions, terms and what to read.

What a minute is

A minute is the board's or the committee's record of its meeting: the date, the place, those present and by what means, the chair, the quorum's satisfaction, the declarations of interest, each matter considered with the papers before the body, the discussion in substance, the decision and the vote, and the approval of the minute at the next meeting or by the chair. It is not a transcript, and a transcript is worse, because it records what was said rather than what was decided. It is not a memorandum by the manager of what the board agreed, because that is the manager's record. It is the body's own record, drafted for it, approved by it, kept by it.

The five things

A minute shows five things a reader tests. Who decided: the named directors or members, present in person or by the means the constitution permits, forming a quorum. On what information: the papers listed, attached or referenced, and the advice received. With what conflicts declared: each interest disclosed, the declaring member's abstention or participation as the constitution allows, and the quorum recomputed. Where: the place of the meeting, which for a company is where its mind is, and for residence purposes is the fact the tax authority reads. When: the date and, where it matters, the time, so that a decision before a transaction is shown to precede it.

Why the decision and the minute are not the same

A decision is an event; a minute is a document. The event has witnesses whose memories fade and diverge, and whose interests by the time of the dispute differ from what they were. The document has a date, a signature and a text that does not change. Every reader of a structure's governance arrives after the event, with a question the event's witnesses may no longer be able to answer, and the document answers it or does not. That is why the regimes require minutes, the companies laws require minute books, the buyers diligence them and the courts weigh them. The decision is what happened; the minute is what can be shown to have happened; and a structure is tested on the second.

The manager's paper and the board's decision

The manager prepares the paper: the investment case, the terms, the risks, the recommendation. The board decides. The minute records that the board considered the paper, asked what it asked, and decided what it decided, and a minute that records the board's adoption of the manager's recommendation without consideration records a board that did not decide. The difference is in the substance the minute records: the questions asked, the alternatives noted, the conditions imposed. A board that imposes a condition the manager did not propose has shown its mind, and the minute that records it is the board's evidence of independence.

The means of meeting

The constitution says how a board may meet: in person, by telephone, by video, by any means by which all can hear each other. The minute records the means and each attendee's location, because the means and the locations are the residence evidence. A board that meets by video with a majority in the company's jurisdiction has met there under most constitutions and most residence readings; one that meets by video with a majority elsewhere has met elsewhere. The constitution may deem a meeting held where the chair is, and the deeming is a constitutional fact the tax authority may or may not accept; the minute records the facts and the deeming both.

The board that sits and the board that signs

A board that sits meets, on notice, with papers, discusses and decides, and the minute records a meeting. A board that signs receives a resolution drafted by the manager's counsel, signs it in three jurisdictions by circulation, and the minute records a written resolution. Both are decisions under most companies laws, and they are different evidence. The board that sits shows a mind at work in a place; the board that signs shows assent to a paper. A holding company whose every decision is a written resolution drafted elsewhere and signed by circulation is a company whose mind, to a reader asking where it was managed, was where the drafting happened. The constitution permits written resolutions, and the board's practice decides how much of its governance is meetings.

The place of the meeting

A company is resident where it is managed and controlled, under most tax regimes, and managed and controlled is a question of fact answered by the minutes: where the board met, who attended from where, whether the decisions were taken there or ratified there. A holding company in a register jurisdiction whose board meets there, with a majority present there, on papers prepared for it, deciding matters of substance, has minutes that answer the question. One whose board meets by telephone with the directors in four countries and the decisions pre-agreed at the manager's desk has minutes that answer it the other way, whatever the registered office says. The minute records the place, and the place is the structure's residence evidence.

The papers

A decision is taken on information, and the minute lists the information: the investment paper, the valuation, the legal opinion, the facility term sheet, the related-party comparison, the administrator's computation. The papers are attached to the minute or referenced by date and kept with it, so that a reader can see what the board saw. A minute that records a decision and no papers records a decision taken on nothing, which a court reads as a decision not properly taken and a regulator reads as a board that did not read. The board's pack is the minute's appendix.

The minute and the confidentiality of the papers

The papers attached to a minute are the body's information, and the minute book is read by regulators, buyers and courts, which means the papers are read by them too. A board that attaches the investment paper, the valuation and the legal opinion has made them part of the record that will be produced, and privilege over the legal opinion may be lost by the attachment under some laws. Counsel advises which papers are attached and which are referenced and kept separately under privilege, and the minute records the reference. The buyer's diligence receives the minute and the referenced papers on terms, and the privileged opinion is summarised rather than produced.

The conflict declared

Every body's constitution requires a member with an interest in a matter to declare it, and the minute records the declaration, the interest's nature, and what followed: abstention, exclusion from the quorum, or participation with the body's leave where the constitution allows it. A minute without declarations on a related-party dealing is a minute that shows a conflict undeclared, and the dealing is voidable on the minute's own evidence. The declaration is the minute's most-read line at inspection.

The written resolution

A written resolution is a decision without a meeting, signed by the members the constitution requires, and it is evidence of assent on its date. It is drafted with the same discipline as a minute: recitals of the papers considered, declarations of interest, the resolution, and the signatures with their dates and places. A written resolution signed in four places on four dates is a decision taken on the last date in the last place, and the board's pre-agreement by email is not the decision. Written resolutions suit matters that need no discussion; a board that uses them for matters that do has a record of assent without a record of consideration.

The minute across the chain

A structure has a board at each layer: the fund, the intermediate holding company, the onshore holding company, the joint venture. A decision that runs through the chain, such as the acquisition of a parcel funded by the fund through two holding companies into a joint venture, is decided at each layer by that layer's board, on that layer's papers, in that layer's place, and each minute shows the layer's own decision rather than the fund's instruction. A chain whose lower boards minute that they acted on the instruction of the fund has minuted that they did not decide, and the lower companies' separateness, which the chain exists to provide, is undone by their own records. Each board decides for its own company, on papers addressed to it, and the minutes show it.

The minute the buyer reads

A buyer of a holding company or a position diligences the minutes for the chain of authority: that the company was authorised to buy what it holds, to borrow what it owes, to grant what it granted, to contract what binds it. A gap in the minutes is a gap in the authority, and the buyer's counsel requires ratification before completion and prices the risk that ratification does not cure. A complete set of minutes is a clean diligence finding; a thin set is a list of conditions precedent.

The minute the regulator reads

The regulator reads minutes for the process the regime requires: related-party approvals with declarations and evidence, valuation readings, allocation readings, the committee's decisions on reserved matters. It reads the fund's committee minutes and the holding companies' board minutes together, because the regime's conflicts rules run through the chain. A manager whose minutes show the process has evidence of compliance; one whose minutes show decisions without process has evidence of breach.

The minute the court reads

A court reads minutes as contemporaneous evidence of what was decided and why, and gives them weight a witness's recollection does not have. A director defending a decision relies on the minute to show the information considered and the reasoning; a holder attacking it relies on the minute's gaps. A minute that records discussion in substance shows a board that considered; one that records a resolution alone shows a board that assented. The court's reading is the reason minutes record substance.

The director who was not there

A director absent from a meeting is recorded as absent, with apologies, and the minute shows the quorum without it. A director present for part of a meeting is recorded as joining and leaving, with the matters decided in its presence shown. A director that left for a conflicted matter is recorded as leaving and returning. The record of presence is the record of who decided each matter, and a minute that lists those present at the start and nothing afterwards has recorded a quorum for the first matter only. The chair's discipline in recording movement is the quorum's evidence.

The approval of the minute

A minute is a draft until the body approves it, at its next meeting or by the chair under the constitution, and the approval is recorded in the next minute. A draft circulated and amended by the members before approval is the body's record, and the amendments are the members' reading of what they decided. A draft the manager circulates and the body never approves is the manager's record, and a reader that asks whether the body approved it reads the next minute for the approval. The approval is the minute's signature, and an unapproved minute book is a book of drafts.

The keeper and the period

The minute is drafted by the company secretary, the administrator or counsel, approved by the body, signed by the chair, and kept at the registered office or with the administrator for the period the companies law and the regime require, which is years and in some regimes the company's life. The keeper's identity is a term of the administration agreement, and a change of administrator is a transfer of the minute book. A minute book that cannot be found is a company whose decisions cannot be shown.

By reader · by question	The question	What the minute shows	What a thin minute shows
The tax authority	Where is the company managed	The place, the attendees, the substance	A registered office and a signature
The regulator	Was the process followed	Declarations, papers, decisions on reserved matters	Decisions without process
The buyer	Was the company authorised	The chain of resolutions with papers	Gaps, ratification, conditions
The lender	Was the security validly granted	The resolution, the quorum, the declarations	A challenge to the security
The court	Did the board consider	Discussion in substance, information, reasoning	Assent
The successor board	What was decided and why	The record	Nothing

A set of minutes, as a type

A fund in a register jurisdiction acquires a parcel through an intermediate holding company and an onshore holding company into a joint venture with a developer. The fund's committee minutes its reading of the allocation record and, because the developer is the manager's affiliate, its approval of the joint venture's terms with declarations and third-party comparisons attached. The fund's board minutes the investment decision on the investment paper and the valuation. The intermediate holding company's board meets in its jurisdiction with a majority present there, on a paper addressed to it, and minutes its own decision to subscribe for the onshore company's shares and to borrow. The onshore holding company's board meets onshore, with its onshore directors, on a paper addressed to it, and minutes its decision to enter the joint venture, with the onshore regime's approvals attached. The joint venture's board minutes its decision to buy the parcel, with the developer's director declaring its interest in the construction contract. Five minutes, five places, five decisions, each on its own papers, each with its declarations, kept by one administrator under one agreement. The buyer in year seven reads them in a day.

The structure paper's page

The structure paper carries a page on minutes: each body in the chain, its constitution's means and quorum and declaration rule, the place its meetings will be held for residence, the keeper, the form of minute, the papers each body receives addressed to it, and the reading the committee does of the chain's related-party minutes. The page is written at the structure's design because the residence reading depends on where the boards will meet, and it is the page the administrator builds the minute templates from.

The onshore board's own minute

An onshore holding company or joint venture in a register jurisdiction has a board under the onshore companies law, with its own quorum, its own declaration rule and its own filing obligations, and its minutes are read by the onshore registrar, the onshore regulator and the onshore tax authority as well as by the fund's readers. The onshore minute is in the form and the language the onshore regime requires, with the fund's readers receiving a translation where needed, and it records the onshore board's own decision on its own paper. A minute in the fund's language and form, filed onshore, is a minute the onshore registrar may not accept; one in the onshore form that records the fund's instruction is a minute the onshore tax authority reads for residence. The onshore minute is drafted by onshore counsel to both readings.

The second fund's reading

A manager's second fund is read against the first fund's minute books: the committee's minutes of its reserved matters, the chain's board minutes, the declarations, the papers attached. A prospective anchor that asks for the first fund's committee minutes and receives a set that shows process is an anchor that knows what it will sit on; one that receives the manager's notes knows too. The second fund's governance is the first fund's record, and the manager that kept minutes raises the second on them.

Four cases, as types

A holding chain's lower boards sign written resolutions drafted at the manager's desk, reciting that they act on the fund's instruction. The tax authority of the manager's jurisdiction asks where the holding companies were managed, reads the resolutions, and answers its own question.

A joint venture's board approves the construction contract with the developer's affiliate without a declaration in the minute. The platform's committee reads the minute at the quarter, the dealing is voidable on its face, and the developer's affiliate is asked to re-tender.

A fund's committee takes its decisions by telephone and the manager writes a note afterwards. The regulator asks for the minutes of the related-party approvals and receives the manager's notes, which show the manager's account of the committee's assent.

A structure minutes each decision at each layer, in its place, on its papers, with its declarations, and keeps the books with one administrator. The buyer, the lender, the regulator and the tax authority each read what they need and ask nothing further.

What each party holds

Each board holds its own decisions, its own papers and its own minutes.

The committee holds its minutes of reserved matters.

The company secretary or administrator holds the drafting, the approval and the keeping.

Counsel holds the constitution's provisions on quorum, means, declarations and written resolutions, and the residence reading.

The manager holds the papers it prepares for each board, addressed to that board.

The buyer, the lender, the regulator and the court hold their readings.

Where it surfaces

It surfaces at the lender's security, when the lender's counsel asks for the board minute authorising the charge and receives a resolution with no quorum recorded. It surfaces at the buyer's diligence, when the chain of authority has a gap at the intermediate holding company. It surfaces at the tax authority's enquiry, when the holding company's minutes show four directors on a call from four countries. It surfaces at the regulator's inspection, when the committee's related-party approvals are the manager's notes. It surfaces at the dispute, when a holder attacks the continuation sale and the committee's minute records a resolution and no discussion. And it surfaces at the change of administrator, when the minute book is found to be incomplete.

The cost of getting it wrong

A minute that does not show the place costs the structure its residence, and the residence is the treaty position, the withholding and the tax on exit. A minute that does not show the declaration costs the dealing its validity. A minute that does not show the papers costs the board its defence. A gap in the chain costs the buyer's price and the seller's warranty. Each is a cost the minute would have prevented at the price of an hour's drafting and a meeting held where it should have been, and the structure that paid the price at the test paid it because the hour was saved.

The substance, recorded

The substance is the part of the minute most boards leave out, because recording discussion is effort and recording resolutions is a template. Substance means the questions asked and answered, the risks noted, the alternatives considered, the conditions imposed, and the reasons for the decision in a sentence. It does not mean attribution of every remark, which chills discussion and produces a transcript. A minute that says the board considered the valuation's special assumptions and asked the manager to confirm the consent's status before completion has recorded substance; one that says the board approved the acquisition has recorded a resolution. The court and the regulator read for the first.

A timeline, as a type

At the structure's formation each body's constitution fixes the means, the quorum and the declaration rule, and the administration agreement names the keeper. At the first acquisition five boards decide in five places on five papers, and five minutes are kept. At the first facility the lender's counsel reads the chain's resolutions and takes the security. At the first related-party dealing the joint venture's minute records the developer's director's declaration and the committee's minute records its approval on the comparison. In year three the tax authority of the manager's jurisdiction enquires and reads the intermediate holding company's minutes showing meetings in its jurisdiction with a majority present. In year five the regulator inspects and reads the committee's minutes with papers. In year seven the buyer reads the chain in a day. In year nine the continuation sale is attacked by a holder and the committee's minute shows the fairness opinion read, the questions asked and the conditions imposed. The structure's governance was what its minutes showed, and its minutes showed it.

The sequence

1. Each body's constitution fixes the quorum, the means of meeting, the declaration rule and the written resolution's use.
2. The administration agreement names the keeper and the period.
3. Each decision is taken by the body whose decision it is, on papers addressed to it, in its place.
4. The minute records the five things and attaches the papers.
5. Declarations are recorded with their consequence.
6. The minute is approved, signed and kept, and the books move with the administrator.

Questions a manager asks

How long should a minute be. Long enough to show the five things and the substance of the discussion; a page for a routine matter, more for a related-party dealing or an acquisition.

Can the manager draft the minutes. The manager may draft for the body's approval; the body approves and the chair signs, and a minute the body amended before approving is the body's.

What about decisions taken in principle by email. The email is the manager's pre-discussion; the decision is the meeting's or the resolution's, and the minute records the decision.

Must every board meet in its jurisdiction. For residence, a majority present there for matters of substance is the usual test; the constitution and local counsel fix it.

Do onshore boards need the fund's papers. They need papers addressed to their own company on their own decision; the fund's investment paper is background, not the onshore board's paper.

Who reads the minutes routinely. The committee reads the chain's related-party minutes quarterly; the administrator reads for completeness; counsel reads at each transaction.

Terms used

Minute: the body's own record of its meeting and decisions.

The five things: who decided, on what information, with what conflicts declared, where and when.

Written resolution: a decision by signature without a meeting.

Managed and controlled: the residence test answered by where the board decides.

Declaration: a member's disclosure of an interest, recorded with its consequence.

Minute book: the kept record of a company's decisions, held by the keeper for the period.

What to read

Each body's constitution on meetings, quorum, declarations and written resolutions; the administration agreement on the keeper; the minutes themselves, layer by layer; local counsel's residence advice. On this site, the governance room under Where complexity arises, the holding room under Structures and the page on our role.