Wednesday, 11 May 2016

Ministry of Corporate Affairs and Corporate Governance

The new acts had several short-comings and pitfalls and the Ministry of Corporate Affairs in consultation with the Registrar of Companies and Corporate sector as well as inputs from industry experts, from time to time issued several circulars, clarifications and orders to remove ambiguities and difficulty in implementation of the Companies Act, 2013 and sought to bring it in line with the industry requirements.  By and large the new corporate Act has brought in transparency and governance, introduced disclosures and shareholders approval in fund-raising, made stringent provisions for corporate deposits and increased social responsibility for corporate, streamlined corporate governance measures (introduction of independent directors requirement) in line with listed companies and introduced stringent penalty provisions for default and non compliance by the corporate sector. 

The Government seems keen to fast track the implementation of whole of the provisions of the Companies Act 2013 and bring-in the desired exemptions wherever needed to overhaul the growth of corporate sector and foster the right climate for Start-ups and entrepreneurship.  Overall though a bit over regulated the new Companies Act, 2013 is a step in the right direction. 

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