In this edition, we have tried to bring to notice the latest amendment that followed in the month of February 2022 issued by MCA, RBI, SEBI, DIPP and others.
Amendments issued by MCA
LLP (Amendment) Rules 2022:
MCA has notified the Limited Liability Partnership (Amendment) Rules, 2022 which shall come into force with effect from April 01, 2022. The amendment is brought under Rule 19(1) which states that a limited liability partnership or a company or a proprietor of a registered trademark under the Trade Marks Act, 1999 already has a name or trademark which is similar to or which too nearly resembles the name or new name of a limited liability partnership incorporated subsequently, may apply to the Regional Director in Form 23 to give a direction to that limited liability partnership incorporated subsequently to change its name or new name, as the case may be. An application of the proprietor of the registered trademark shall be maintainable within a period of three years from the date of incorporation or registration or change of name of limited liability partnership under the Act. Further, a new Rule 19A which deals with the allotment of the new name to an existing LLP has been notified.
To read more: https://www.mca.gov.in/bin/dms/getdocument?mds=8JwzH7TbzRV%252FecDCxJUOyQ%253D%253D&type=open
Companies (Accounts) Amendment Rules, 2022:
MCA has notified the Companies (Accounts) Amendment Rules, 2022 which shall come into force on the date of MCA publication in their Official Gazette i.e 11-02-2022. A new e-Form CSR-2 has been introduced. Every company with CSR responsibility shall furnish a report on Corporate Social Responsibility in Form CSR-2 to the Registrar for the preceding financial year (2020-2021) and onwards as an addendum to Form AOC-4 or AOC-4 XBRL or AOC-4 NBFC (Ind AS), as the case may be. For the financial year (2020-2021), Form CSR-2 shall be filed separately on or before March 31, 2022.
To read more: https://www.mca.gov.in/bin/dms/getdocument?mds=adQPpN3U8Y7Llcmy0C8FvA%253D%253D&type=open
FAQ’s on V3 (New Application) for e-filing by the Limited Liability Partnerships (LLPs):
All the LLP e-filing services are being upgraded and migrated to the MCA V3 portal. However, all the other services will continue to exist at the MCA V2 portal. MCA is launching this new application (v3) for e-filing by LLPs on the MCA21 portal to improve the delivery of LLP services. All LLP filings shall be web-based from 06/03/2022 and onwards. MCA21 V3.0 will reduce the requirements of attachments, make the forms web-based and strengthen the pre-fill mechanism.
To read more: https://www.mca.gov.in/content/dam/mca/pdf/v3FAQs_20022022.pdf
Notification under section 67 of LLP Act 2008:
MCA has notified that the provisions of Sections 90 (Register of significant beneficial owners in a Company), Section 164 (Disqualifications for Appointment of Director), Section 165 (Number of Directorships), Section 167 (Vacation of Office of Director), Section 206(5)-(Power to Call for Information, Inspect Books and Conduct Inquiries), Section 207(3)-(Conduct of Inspection and Inquiry), Section 252 (Appeal to Tribunal for the Revival of Companies) and Section 439 (Offences to be Non-cognizable) of the Companies Act,2013 shall also apply to Limited Liability Partnership from the date of publication of this notification. Any person holding office as a designated partner in limited liability partnerships more than the limits as specified in the Act, immediately before this notification shall, within a period of one year from such notification, choose not more than the specified limit of those limited liability partnerships, as limited liability partnerships in which he wishes to continue to hold the office of designated partner.
To read more: https://www.mca.gov.in/bin/dms/getdocument?mds=s3NAd1DMJP%252Bb4D3KxSkX1Q%253D%253D&type=open
Relaxation on levy of additional fees in the filing of e-forms AOC-4, AOC-4 (CFS), AOC-4, AOC-4 XBRL AOC-4 Non-XBRL and MGT-7/MGT-7A for the financial year ended on 31.03.2021 under the Companies Act, 2013:
In continuation to Ministry’s General Circular No. 22/2021 dated 29.12.2021, keeping in view various requests received from stakeholders regarding relaxation of levy of additional fees for annual filings to be done, it has further decided that no additional fees shall be levied up to 15.03.2022 for filing e-form AOC-4/AOC-4(CFS)/AOC-4 XBRL and up to 31.03.2022 for filing e-form MGT-7/7A in respect of financial year 31.03.2021.
To read more: https://www.mca.gov.in/bin/dms/getdocument?mds=dJwPZuhvXhaSatUCw9YnZA%253D%253D&type=open
Amendments issued by SEBI
Disclosures in the abridged prospectus and front cover page of the offer document:
SEBI has notified a new format for disclosures in the abridged prospectus, whereby critical information will be provided on the front page of the offer document. Under the rules, every application form for the purchase of any securities of a company needs to be accompanied by an abridged prospectus. A company will have to disclose the name of the promoter, details of the offer to the public, types of issue, fresh issue and offer for sale (OFS) component, total issue size and share reservations details on the front page of the abridged prospectus (DRHP or RHP). Further, they will have to insert a Quick Response (QR) code on the front page of the documents such as front outside cover page, abridged prospectus, price band advertisement, etc as deemed fit by them. The scan of the QR code will lead to downloading of prospectus, abridged prospectus and price band advertisement as applicable.
To read more: https://www.sebi.gov.in/legal/circulars/feb-2022/disclosures-in-the-abridged-prospectus-and-front-cover-page-of-the-offer-document_55920.html
Separation of the role of Chairperson and MD/CEO of listed entities & Amendment to SEBI (Alternative Investment Funds) Regulations, 2012:
The SEBI (LODR) was amended in May 2018 mandating, with effect from April 1, 2020, top 500 listed entities to ensure that the Chairperson of the board shall be a non-executive director and who is not be related to the Managing Director or the Chief Executive Officer. Considering rather an unsatisfactory level of compliance achieved so far, concerning this corporate governance reform, various representations received, constraints posed by the prevailing pandemic situation and to enable the companies to plan for a smoother transition, as a way forward, SEBI Board has decided that this provision may not be retained as a mandatory requirement and instead be made applicable to the listed entities on a “voluntary basis”.
The Board also approved an amendment to SEBI (Alternative Investment Funds) Regulations, 2012, providing flexibility to Category III Alternative Investment Funds (AIFs) to calculate the investment concentration norm-based either on investable funds or net asset value of the fund while investing in listed equity of the investee company.
To read more: https://www.sebi.gov.in/media/press-releases/feb-2022/sebi-board-meeting_56076.html
Change in control of the asset management company involving scheme of arrangement under Companies Act, 2013:
SEBI has come out with a procedure to be followed for the proposed change in control of an Asset Management Company involving a scheme of arrangement which needs the sanction of the National Company Law Tribunal (NCLT). The procedure will apply to all the applications for change in control of an Asset Management Company (AMC) for which the scheme of arrangement is filed with NCLT on or after March 1, 2022. The application seeking approval for the proposed change in control of the AMC needs to be filed with SEBI before filing it with the NCLT.
Guidelines on Accounting concerning Indian Accounting Standards(IND AS):
SEBI has notified a set of guidelines for Asset Management Companies (AMCs) concerning following Indian Accounting Standards (Ind AS). SEBI has directed the mutual fund schemes to prepare the opening balance sheet as on the date of transition and the comparatives as per the requirements of IND AS. The financial statements of the mutual fund schemes will have to be prepared in a format specified by SEBI.
Audit Committee of Asset Management Companies (AMCs):
SEBI has issued a circular to all the Asset Management Companies of mutual funds to constitute an Audit Committee from 1st August 2022. The Audit Committee of the AMC shall be responsible for oversight of the financial reporting process, audit process, company’s system of internal controls, compliance to laws and regulations and other related processes, with specific reference to the operation of its Mutual Fund business.
To read more: https://www.sebi.gov.in/legal/circulars/feb-2022/circular-on-audit-committee-of-asset-management-companies-amcs-_55987.html
Miscellaneous Amendments
Plastic Waste Management (Amendment) Rules, 2022:
The Environment Ministry has notified comprehensive guidelines on Extended Producer Responsibility (EPR) for plastic packaging through notification of the new Plastic Waste Management (Amendment) Rules, 2022. The new rules classify plastics into four categories. According to the new rules, the producers, importers and brand-owners shall have to provide the details of recycling certificates only from registered recyclers along with the details of quantity sent for end-of-life disposal, by June 30 of next financial year while filing annual returns on the online portal. The government has also called for the establishment of a centralised online portal by Central Pollution Control Board (CPCB) for the registration as well as filing of annual returns by producers, importers and brand-owners, plastic waste processors of plastic packaging waste by March 31.
To read more: https://egazette.nic.in/WriteReadData/2022/233568.pdf
POSH:
The Deputy Commissioner Cum District Officer, SHWW Act, 2013, Gurugram has issued a circular regarding submission of Annual Report under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act 2013. As per the decision of the District Officer, SHWW Act, 2013, Gurugram every Government & Non-Government organisation has to submit their Annual Report under Section 21 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013 by April 30 of every year.
To read more: https://www.compfie.com/wp-content/uploads/2022/01/11012022_LEI_01.pdf
International Financial Services Centres Authority (Insurance Web Aggregator) Regulations, 2022:
The International Financial Service Centres Authority (IFSCA) has notified the International Financial Services Centres Authority (Insurance Web Aggregator) Regulations, 2022 which aims to put in place a process of registration and operations of Insurance Web Aggregator (IWA) in an International Financial Services Centre under the regulatory purview of the International Financial Services Centres Authority. The Applicant shall not engage in any business other than Web Aggregation of Insurance Products or Insurance Broking and shall have all the necessary infrastructure to effectively discharge its business activities.
To read more: https://ifsca.gov.in/Viewer/Index/270