Ease of doing business: Company Law Committee to suggest ways to improve situation

For improving ease of doing business, government is planning to re-categorise certain offences under Companies Act into' civil wrongs’ with lesser impact and also find ways to declog the NCLTs. The focus is also on improving the working of Serious Fraud Investigation Offie (SFIO) and National Financial Reporting Authority (NFRA). For this purpose Ministry of Corporate Affairs has constituted a Company Law  Committee that will examine and recommend to the Government on various provisions and issues pertaining to implementation of the Companies Act, 2013 and the Limited Liability Partnership Act, 2008.

The idea is to align the Companies Act and LLP Act in line with the Government's objective of promoting ease of living in the country by ensuring ease of doing business to law abiding corporates, fostering improved corporate compliance for stakeholders at large and to address emerging issues having impact on the working of corporates in the country.

The terms of reference of the Committee will be to suggest ‘offences’ that can be  re-categorized as 'civil wrongs' along with measures to optimize compliance requirements under the Companies Act, 2013 and concomitant measures to provide further ease of doing business, It will also examine the feasibility of introducing settlement mechanism, deferred prosecution agreement, etc., within the fold of the Companies Act, 2013. Committee will also study the existing framework under the Limited Liability Partnership Act, 2008 and suggest measures to plug the gaps, if any, while at the same time enhancing the ease of doing business.

Committee under the chairmanship of Corporate Affairs Secretary will also propose measures to further de-clog and improve the functioning of the NCLT, focus will also be on removing any bottlenecks in the overall functioning of the statutory bodies like SFIO, IEPFA, NFRA, etc. under the Companies Act. Committee will also identify specific provisions under the Companies Act, 2013 and the Limited Liability Partnership Act, 2008 which are required to be amended to bring about greater Ease of Living for the corporate stakeholders, including but not restricted to review of Forms under the two Acts.

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As per the notification of Ministry of Corporate Affairs the Company Law Committee will comprise of Secretary MCA , who will be the chairman of the committee. Members of the committee will include Uday Kotak, TK Viswanathan Ex Secretary General, Lok Sabha, Shardul S Shroff,  CA Amarjit Chopra, CA Rajib Shekhar Sahoo, Ajay Bahl of AZB Partners, CA G Ramaswamy, Siddhartha Birla, Ex President, FICCI, Preeti Malhotra, Ex President, ICSI and joint secretary (policy) in the Ministry of Corporate Affairs.

Committee may also invite or co-opt any other practitioners, subject matter experts who have knowledge or experience in the field of corporate law and representatives from other Ministries or regulators. The Committee may also consult other stakeholders as part of its deliberations. The committee will have tenure of one year from the date of its first meeting.