The MCA vide its Notification dtd. 05th May, 2022 has notified Companies (Prospectus and Allotment of Securities) Amendment Rules, 2022 to amend the existing Companies (Prospectus and Allotment of Securities) Rules, 2014. The amendment pertains to insertion of a proviso in Rule 14 (private placement) with regards to not giving an offer or invitation of any securities under Rule 14 to a body corporate incorporated in, or a national of, a country which shares a land border with India, unless such body corporate or the national, as the case may be, have obtained Government approval under the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 and attached the same with PAS-4 and also insertion of check box in form PAS-4 (Private Placement Offer cum Application Letter) with regards to whether applicant is required to obtain Government approval under the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 prior to subscription of shares or not.
If such an approval is required to be obtained then it is mandatory to enclose the approval letter with form PAS-4.
This notification shall come into force on the date of its publication in the Official Gazette i.e., 05th May, 2022.
MINISTRY OF CORPORATE AFFAIRS
NOTIFICATION
New Delhi, the 5th May, 2022
G.S.R. 338(E).—In exercise of the powers conferred by section 42 read with sub-sections (1) and (2) of section 469 of the Companies Act, 2013 (18 of 2013), the Central Government hereby makes the following rules further to amend the Companies (Prospectus and Allotment of Securities) Rules, 2014, namely:-
1. (1) These rules may be called the Companies (Prospectus and Allotment of Securities) Amendment Rules, 2022.
(2) They shall come into force from the date of their publication in the Official Gazette.
2. In the Companies (Prospectus and Allotment of Securities) Rules, 2014, ―
(i) in rule 14, in sub-rule (1), after the fourth proviso, the following proviso shall be inserted, namely :-
“Provided also that no offer or invitation of any securities under this rule shall be made to a body corporate incorporated in, or a national of, a country which shares a land border with India, unless such body corporate or the national, as the case may be, have obtained Government approval under the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 and attached the same with the private placement offer cum application letter.”.
(ii) in Annexure, in Form PAS-4, in Part-B, after serial number (vii), the following shall be inserted, namely :-
“(viii) Tick whichever is applicable:-
(a) The applicant is not required to obtain Government approval under the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 prior to subscription of shares.-
(b) The applicant is required to obtain Government approval under the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 prior to subscription of shares and the same has been obtained, and is enclosed herewith.-
[F. No. 1/21/2013-CL-V]
MANOJ PANDEY, Jt. Secy.
Note : The principal rules were published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 251(E), dated the 31st March, 2014 and last amended vide notification number G.S.R. 642(E), dated the 16th October, 2020.
Author Bio
