THE MINISTRY OF CORPORATE AFFAIRS (MCA) IS ACTIVELY REVIEWING THE COMPANIES ACT FOR FURTHER AMENDMENTS- FURTHER EASE OF DOING BUSINESS

 THE MINISTRY OF CORPORATE AFFAIRS  (MCA)  IS ACTIVELY REVIEWING THE COMPANIES ACT FOR FURTHER AMENDMENTS- FURTHER EASE OF DOING BUSINESS 

The corporate affairs ministry (MCA) is preparing significant amendments to the companies law, aiming to ease business operations and reduce compliance burdens.  

Key changes under consideration include mandatory risk management committees, a stronger audit framework, and simplified capital raising rules, with introduction planned for the winter parliamentary session. 

PROPOSED FUTURE AMENDMENTS (UNDER DELIBERATION) 

The Ministry of Corporate Affairs is actively reviewing the Companies Act for further amendments, potentially including: 

RISK MANAGEMENT COMMITTEES:  

• Introduction of a provision for mandatory Risk Management Committees in certain companies to strengthen oversight of risk detection and resolution. 

 

ELECTRONIC COMMUNICATION & MEETINGS:  

 

Allowing companies to communicate with members in electronic form only and permitting general meetings to be held in virtual, physical, or hybrid modes. Broader recognition of technology in shareholder engagement. 

 

REPLACEMENT OF AFFIDAVITS:  

Replacing the requirement of affidavits for various purposes with simple self-declarations. 

 

DIRECTOR PROVISIONS:  

Revisiting provisions concerning the disqualification of directors and the procedure for the resignation of Key Managerial Personnel (KMP). 

 

EASE IN CAPITAL RAISING:  

 

Streamlined norms for issue of securities and private placements. 

FASTER RESTORATION OF STRUCK-OFF COMPANIES:  

Quicker revival mechanisms through digital facilitation. 

ELECTRONIC COMMUNICATION WITH SHAREHOLDERS: 

Mandatory digitization of shareholder correspondence and disclosures. 

FINAL THOUGHTS   

These reforms are aimed at aligning India's corporate governance framework with global best practices, enhancing transparency, and creating a more competitive and investment-friendly environment for businesses of all sizes, especially MSMEs and startups. 

 

R V SECKAR , FCS ,LLB 79047 19295