In August 2023, several significant regulatory updates in SEBI, RBI, Company Law, and Insolvency Law have come into effect. These changes have implications for businesses, investors, and the legal landscape. This article provides a comprehensive overview of the key updates and their potential impact.
Company Law
1. Companies (Incorporation) Second Amendment Rules, 2023
- Revised Form RD-1 to be used by companies for filing application to Central Government (Regional Director) for approval of Compromises, Arrangements, Amalgamations and conversions.
MCA Amends Central Govt. Application Form No. RD-1
SECURITIES LAW
1. SEBI Reduces Timeline for Listing of Shares in Public Issue from Existing T+6 Days to T+3 Days
- The T+3 listing timeline must be disclosed in Offer Documents for public
- The circular shall be applicable on a voluntary basis for public issues opening on or after 09.2023, and it will become mandatory for public issues opening on or after 01.12.2023.
SEBI reduces listing timeline for public issue shares from T+6 days to T+3 days
2. Online Resolution of Disputes in the Indian Securities Market.
- Online Dispute Resolution (ODR) Portal will be managed by Market Infrastructure Institutions (MIIs), which include Stock Exchanges and Depositories.
- The process is outlined in a step-by-step manner, starting from dispute initiation and escalation through the ODR Portal, to the appointment of independent conciliators and arbitrators.
SEBI Master Circular for Online Resolution of Disputes in Indian Securities Market
3. SEBI has introduced Voluntary Delisting Norms for Non- Convertible Debt Securities (NCDs) & Non-Convertible Redeemable Pref. Shares (NCRPs).
SEBI has notified the SEBI (LODR) (3rd Amendment) Regulations, 2023 and new Chapter -VI A added which provides framework for Voluntary Delisting of NCDs & NCRPs
- The framework shall not be applicable on certain listed entities as notified.
- The listed entity shall within 15 working days from the date of passing of the Board Resolution or any statutory approval whichever is later is required to make application to relevant stock exchange for in-principal approval for the proposed delisting of NCDs/NCRPs and such application shall be disposed off within 15 working days from receipt of application by respective stock exchange.
- The listed entity shall within 3 working days from receipt of in principal approval, ensure commencement of obtaining of all necessary approvals form holders of NCDs and NCRPs.
- During the delisting process, stock exchange shall monitor compliance of listed entity and report any non-compliances to the SEBI Board.
SEBI (Listing Obligations and Disclosure Requirements) (Third Amendment) Regulations, 2023
INSOLVENCY LAW
1. IBBI recommendation for appointment of Liquidator other than Interim Resolution Professional/ Resolution Professional
- An independent IP needs to be entrusted to conduct the liquidation process of the CD
- Segregation of dual role of an IP in the same CD as RP & Liquidator
Source: IBBI Letter No. Liq-12011/24/2023-IBBI/840 Dated: 18th July 2023
CASE LAW
COMPANY LAW
1. RD Sets Aside ROC’s Order w.r.t Non-appointment of CS as Company had Incurred Losses & Itself Got Delisted
- Penalty imposed due to non appointment of CS on rolls for an amount of Rs.6.50 lac against which appeal was made before Regional Director.
- Regional Director, upon hearing the submissions set aside the order as the Company was not carrying any business activities from last six years & not in position to appoint
- Further directed ROC to give due consideration to all aspects before passing an order of
SECURITIES LAW
1. SAT reduces the penalty for non-serious LODR violations from Rs 25 to 10 Lakh.
- Violation of due process for approving related party transactions & failure to disclose that a forensic audit is being initiated which constituted a material
- SEBI considering the above violations imposed a penalty of Rs. 25 lakh on the Company against which appeal was made before
- The SAT held that the said violations were not that serious and reduced the penalty of 25 lakhs to Rs. 10 lakh
1. Notification on registration of Trust and Company Service Provider (TCSP) with FIU_IND
Other Updates
- TCSP are covered under the definition of ‘Reporting Entity’ under
- Registration on FINNET 2.0 Portal with FIU-INDIA for TCSP is pre- requisite for a reporting entity to become complaint with the reporting obligation under
- Certain activities exempted from
2. LLP Amnesty Scheme (Condonation of delay for Form 3, Form 4 and Form-11)
- Effective from 1st September 2023 till 30th November 2023.
- Condonation of delay in filing of Form 3/ Form 4/Form 11 for event date after 1st January 2021.
- For event date prior to 01.01.2021 the additional fee will be 2 times or 4 times the normal fee based on type of LLP small or other than small.
- S𝐦𝐚𝐥𝐥 𝐋𝐋𝐏𝐬 are those whose contribution does not exceed 25 lacs and turnover does not exceed 40 Lacs.
Condonation of Delay in LLP Forms Filing: MCA Circular 08/2023
Due Dates under various laws
| 15th September 2023 | Revised RBI FLA based on audited financials |
| 27th September 2023 | AOC-4(OPC) Form for Filing Financial Statement |
| 30th September 2023 | DIR-3 KYC of Director/Partner |
| Convening AGM for FY 2021-22 |
Disclaimer: This newsletter is a compilation of updates prepared and circulated from the academic point of view only and are not intended to constitute professional advice on any matter. The views and opinions expressed in this newsletter are those of the author of this document and are based on the internal research done by the Author.
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