LSI Analysis: 50 Key Takeaways from Report of the Companies Law Committee

1. On June 4, 2015, Govt. had constituted 8 members Company Law Committee for giving recommendations on issues pertaining to implementation of Companies Act, 2013;
2.  On February 1, 2016, the Committee submitted 138-pages detailed Report and suggested 100+ amendments to the Act;
3. The Report suggests amendment to definition relating to ‘holding company’, ‘subsidiary company’, ‘associate company’, ‘financial year’, ‘related party’ and recommends inclusion of definition for ‘nominee director’;
4. Committee also proposes to ease capital raising requirements, to allow private limited co. and wholly owned subsidiaries of unlisted cos. to convene Annual General Meetings at any place in India;
5. Committee recommends introduction of ‘test of materiality’, for determining whether pecuniary relationships could impact the independence of an individual for becoming an independent director;
6. With respect to CSR provisions, Committee proposes to do away with mandatory requirement of having independent directors in the CSR Committee.
7. MCA has invited comments from all stakeholders on the Report by February 15, 2016.

Click here to read 50 Key Takeaways from Report of the Companies Law Committee