Ministry of Corporate affairs amended the Companies (Meetings of Boards and its powers) Rules, 2014. The Companies (Meetings of Boards and its Powers) Amendments Rules, 2017 was published in official gazette on 30th March 2017 and came into force on that date itself.
On 1st February 2016, Ministry of Corporate Affairs uploaded the report of Companies Law Committee on its website here. In 6th post on this report, we will discuss recommendations of the committee related to Related Party transaction, Audit Committee, Managerial Remuneration, Key Managerial Personnel, etc.
Ministry of corporate Affairs issued a notification dated 14th December 2015 and published here in the Gazette of India dated 15th December 2015 regarding amendment in the Companies (Meetings of Board and its Power) Rules 2014.
Ministry of corporate Affairs issued a notification dated 14th December 2015 and published here in the Gazette of India dated 15th December 2015 regarding amendment in the Companies (Meetings of Board and its Power) Rules 2014.
The Companies (Meetings of Board and its Power) Second Amendment Rules, 2015 (i) inserts a new Rule 6A, (ii) omit present Rule 10 and (iii) amend present Rule 15(3).
We will discuss newly inserted Rule 6A in a future post. In this post we bill discuss other two amendments in very brief way.
We have discussed now omitted Rule 10 earlier here. These rules became redundant after the Company (Amendment) Act, 2015 as discussed earlier here. Hence, it is deleted.
We have discussed Rule 15 earlier here. There is a minor but very important amendment in Rule 15(3). In rule 15, in sub-rule (3), for the words “special resolution”, wherever they occur, the word “resolution” shall be substituted.
This amendment is in line with the amendment in Section 188 by the Companies (Amendment) Act, 2015 discussed earlier here.
This has a very significant effect and dilutes corporate governance to certain level. This cut power of non – promoter investors whether they are indigenous investors or foreign investors.
Please note: This blog invite readers to share their comments, suggestions, hardship, queries and everything in comment section. This blog post is not a professional advice but just a knowledge sharing initiative for mutual discussion.
The Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations 2015 was notified on 2nd September 2015 and will come into force from 1st December 2015. However, Regulation 31A of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 came into force on 2nd September 2015 on publication of these regulations along with sub – regulation (4) of Regulation 23. In last post here, we discussed Regulation 31A and in this post we will discuss Regulation 23.
Posted in CorpGov, Governance and Responsibility, Listing obligation and Disclosure Regulation, SEBI
Tagged India, Listing, Listing Agreement, Listing Obligation and Disclosure Requirements, LODR, Material Related Party Transaction, Related Party Transaction, SEBI, Securities & Exchange Board of India
The Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations 2015 was notified on 2nd September 2015 and will come into force from 1st December 2015. In this post we will discussion definition of Holding, Subsidiary, Associates, Relative, Related Party, and Related Party Transactions.
A draft notification posted here on website of Ministry of Corporate Affairs says that Section 1 to 12 and Section 15 to 23 of the Companies (Amendment) Act, 2015 came into force with effect from 29th May 2015. The official language of notification read, “the Central Government hereby appoints the 296 May, 2015 as the date on which the provisions of sections 1 to 12 and 15 to 23 of the said Act shall come into force.” The Amendment Act was got presidential assent and notified by Ministry of Law and Justice as such on 26th May 2015 in official gazette.
Two sections not notified yet deals with Fraud Reporting Procedure [Section 13 amending Section 143 of Principal Act] and Related Party Transactions [Section 14 amending Section 177 of Principal Act]. This is understood that Rules related to these sections are in drafting process.
Posted in Chapter I - CA2013, Chapter IX - CA2013, Chapter X - CA2013, Chapter XIX -CA2013, chapter XVI - CA2013, Chapter XX - CA2013, Chapter XXI - CA2013, Chapter XXII - CA2013, Chapter XXIII - CA2013, Chapter XXIX - CA2013, CHAPTER XXVI - CA2013, Chapter XXVII - CA2013, Chapter XXVIII - CA2013, Companies Act 2013, Governance and Responsibility
Tagged Bail, Companies Act 2013, Corporate Law, Depreciation, Dividend, Fraud, India, Investor Education and Protection Fund, Ministry of corporate affairs, Related Party Transaction, Special Court, The Companies Amendment Act 2015, unclaimed dividend, Winding Up
The Companies Amendment Bill 2014 has been introduced and passed in Lok Sabha recently. This blog post has intention to analyse proposed changes in the Companies Act 2013.
Most important massage, this amendment prepares a best case for drafting skill development programmes in India. I am reading here this Bill clause by clause. This will be a three part series and part 2 of 3 is present here.
To amend sub-section (1) of section 188 of the said Act to exempt related party transactions between holding companies and wholly owned subsidiaries (WOS) from the requirement of approval of non-related shareholders [Section 16 of the Amendment Bill]
Posted in Chapter I - CA2013, Chapter XII - CA2013, Chapter XXIX - CA2013, Chapter XXVII - CA2013, Chapter XXVIII - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility
Tagged Bail, Companies Act 2013, Corporate Law, India, Ministry of corporate affairs, Related Party Transaction, Special Court, The Companies Amendment Bill 2014, Winding Up
Contracts in which directors are involved are one of major corporate governance issue. Many corporate failures may be attributed to contracts related to directors under some intention which are not in consistency with fiduciary duties of directors. We have already discussed contract in which directors are interested and related party transaction in this earlier post.
REGISTER OF CONTRACTS OR ARRANGEMENTS IN WHICH DIRECTORS ARE INTERESTED (SECTION 189):
Every director or key managerial personnel shell within a period of thirty days of his appointment disclose to the company particulars relating to his concern or interest in other companies or organisation.
Posted in Chapter XII - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility
Tagged Companies Act 2013, Companies Bill 2012, Contract in which directors are interested, CorpGov, CorpLaw, Corporate Governance, Corporate Law, India, insider trading, Legal Reforms, Ministry of corporate affairs, Reforms, register of contracts in which directors are interested, Related Party, Related Party Transaction
UPDATE: on 30th August 2013: Companies Bill 2012 became the Companies Act, 2013 (Act 18 of 2013).
DISCLOSURE OF INTEREST BY DIRECTOR (SECTION 184, SUB SECTION 1):
Every director shall disclose his concern or interest in any company or companies or bodies corporate, firms, or other association of individuals which shall include the shareholdings, in such manner as may be prescribed. Such disclosure shall be made on three particular point of time:
(i) At the first meeting of the Board in which he participates as a director;
(ii) At the first meeting of the Board in every financial year; and
(iii) Whenever there is any change in the disclosures already made, then at the first Board meeting held after such change.
Posted in Chapter XII - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility
Tagged Arms Length Transaction, Companies Bill 2012, CorpGov, CorpLaw, Corporate, Corporate Governance, Corporate Law, Director, Disclosure of Interest, Independent Director, Interest, Legal Reforms, Office or Place of Profit, Reforms, Related Party, Related Party Transaction, Relative, RPT, Voidable Contract
UPDATE: on 30th August 2013: Companies Bill 2012 became the Companies Act, 2013 (Act 18 of 2013).
The Board of Directors is most powerful body in a company. The Corporate governance is until now is governance of the Board.
The Companies Bill 2012 has dedicated chapter i.e. Chapter XII dealing with Board meetings and its power. In this blog I will discuss Board Meetings and in a future post power of Board of Directors.
Posted in Chapter XII - CA2013, Companies Act 2013, Company Secretary, CorpGov, Governance and Responsibility, Secretarial Standards
Tagged Board of Directors, Board Resolution, Companies Bill 2012, CorpGov, CorpLaw, Corporate Governance, Corporate Law, Director, Independent Director, Key managerial personnel, Manager, Managerial Remuneration, Managing Director, Minutes of Meeting, Notice, Quorum, Reforms, Related Party Transaction, Resolution by Circulation, Whole – time Director
UPDATE: on 30th August 2013: Companies Bill 2012 became the Companies Act, 2013 (Act 18 of 2013).
Delegation of Power is buzz word in this Companies Bill 2012. This delegation is not only from legislature to Executive but also from Board of Directors to its committees. Committees are not new to Indian Corporate Jurisprudence. Audit Committee was introduced in the present Companies Act, 1956 twelve years ago in year 2000. Schedule XII also has Remuneration committee.
Posted in Chapter XII - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility
Tagged Accounts and Audit, Audit Committee, Board Committee, Board of Directors, Companies Bill 2012, CorpGov, CorpLaw, Corporate Governance, Corporate Law, Corporate Social Responsibility, Corporate Social Responsibility Committee, Cost Audit, CSR, CSR Committee, Director, Independent Director, Internal Audit, Investor grievances, Key managerial personnel, Legal Reforms, Managerial Remuneration, Managing Director, Ministry of corporate affairs, Nomination and Remuneration Committee, Reforms, Related Party Transaction, Stakeholders Relationship Committee, Statutory Audit, Whistle blower, Whole – time Director
(UPDATE: on 30th August 2013: Companies Bill became the Companies Act, 2013 (Act 18 of 2013).
When I was reading Section 149 of the Companies Bill, 2012 for an earlier post “Appointment and Qualification of Director”, I have not discussed provisions related to independent director. As mentioned in that post every listed company shall have at least one-third of total number of directors as Independent directors. The central government may prescribe minimum number of independent directors in other class or classes of public companies. Independent director is a genre of directors and all law related to duties, vacation, resignation, removal will also be applicable to them also. do not forget; they are not key managerial personnel or officer in default.
Posted in Chapter XI - CA2013, Companies Act 2013, CorpGov, Governance and Responsibility
Tagged Board Committee, Board of Directors, Code for Independent Directors, Companies Bill 2012, CorpGov, CorpLaw, Corporate Governance, Corporate Law, Director, Independent Director, Independent Directors, India, Law, Legal Reforms, Liability of Independent Directors, Ministry of corporate affairs, Profession, Reforms, Related Party Transaction, Whistle blower
UPDATE: on 30th August 2013: Companies Bill 2012 became the Companies Act, 2013 (Act 18 of 2013).
In any jurisdiction, Quality of Corporate Governance and compliance of ethics depends upon quality of people taking charge of the affairs. The companies Bill 2012 have some inbuilt elements of corporate governance in it. First time Concept of Key Managerial Personnel is being introduced in India. Which seems different with “officer who is in default” as that concept is still in this Bill.
Posted in Chapter XIII - CA2013, Companies Act 2013, Company Secretary, CorpGov, Governance and Responsibility
Tagged Board of Directors, Chief Executive director, Chief Financial Officer, Companies Act 2013, Companies Bill 2012, Company Secretary, CorpGov, CorpLaw, Corporate Governance, Corporate Law, India, Key Legal Reforms, Key managerial personnel, Manager, Managing Director, Ministry of corporate affairs, Officer, officer who is in default, Profession, Reforms, Related Party Transaction, Whole – time Director
(UPDATE: on 30th August 2013: Companies Bill became the Companies Act, 2013 (Act 18 of 2013). Post updated accordingly)
In my blog post titled “Corporate Governance: Regulatory Frameworks under Consideration” I mentioned that some of the provisions related to corporate governance and voluntary guideline on corporate governance issued by Ministry of Corporate Governance has been incorporated into new Companies Bill, 2012 [now, the Companies Act, 2013]. In this post, I will examine these provisions and their effect on corporate governance.
Posted in Companies Act 2013, Company Secretary, CorpGov, Governance and Responsibility
Tagged Audit Committee, Auditor, Board Committee, Boards’ Report, Chartered Accountant, Class Action, Companies Bill 2012, Company Secretary, CorpGov, CorpLaw, Corporate Governance, Director, Independent Director, India, National Financial Reporting Authority, NFRA, Nomination and Remuneration Committee, Profession, Related Party Transaction, Secretarial Audit, Stakeholders Relationship Committee
Writer of this blog, Aishwarya Mohan Gahrana is Practicing Company Secretary and Insolvency Professional working with M/s Aishwarya M Gahrana & Associates, a New Delhi based peer reviewed firm of company secretaries having pan India presence through friends and associates. This blog is a knowledge sharing initiative. Views expressed here is of writer; not of the organization(s) he is working with.
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