On behalf of the entire team of SB Partners, here’s wishing you a very Happy New Year!

In the last three months we saw numerous changes in the areas of Banking and Finance, Capital Markets and Corporate Laws, Competition Laws and Insolvency and Bankruptcy Laws of India.

The process pertaining to re-classification of ‘Public Shareholders’ to ‘Promoters’ and vice-versa, underwent some major changes. SEBI has now made it mandatory to get the ‘re-classification request’ approved by the board of directors as well as shareholders of the company. Further, in terms of the new process, promoters who seek reclassification shall not hold 10% of the total voting rights of the company.

The other notable developments were in the area of Corporate Laws. The Companies (Amendment) Ordinance, 2018 (“Ordinance”) introduced several new compliances which are to be adhered by the companies and several new penalties on companies and officers in default, which have been discussed in detail herein. It also provided for disqualification of directors in case their directorships exceed the permissible limits under the Companies Act, 2013 and empowers the Registrar of Companies to strike off the name of a company from the Register of Companies, in case it is not carrying on any business.

In addition to the foregoing, this issue of ‘Lex Novus’ also focuses on other key regulatory developments in the field of Capital Markets. The issuers are no longer required to give a security deposit of one (1) % of the value of securities to the stock exchange before getting ‘debt securities’, ‘non-convertible redeemable preference shares’, ‘securitized debt instruments’ and ‘security receipts’ listed on such stock exchange.

We hope you find this edition of Lex Novus informative and insightful.

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