Key amendments proposed in CA 2013, LLP Act 2008 by The Company Law Committee (2022)

I. Allowing certain companies to revert to the financial year followed in India;

II. Facilitating certain companies to communicate with their members in only electronic form;

III. Recognising issuance and holding of fractional shares, Restricted Stock Units and Stock Appreciation Rights;

IV. Easing the requirement of raising capital in distressed companies;

V. Replacing the requirement of furnishing affidavits with the filing of self certification/declaration;

VI. Clarifying the inclusion of ‘free reserves’ while determining the limit for buying back of a company’s equity shares;

VII. Prohibiting companies from recording trusts on their register of members;

VIII. Allowing companies to hold general meetings in virtual, physical or hybrid modes;

IX. Creating an electronic platform for maintenance of statutory registers by companies;

X. Clarifying provisions relating to Investor Education and Protection Fund;

XI. Strengthening the National Financial Reporting Authority;

XII. Reviewing and strengthening the audit framework and introducing mechanisms to ensure the independence of auditors;

XIII. Standardising the manner for auditors to provide qualifications;

XIV. Recognising and providing an enabling framework for the constitution of Risk Management Committees;

XV. Clarifying the tenure of independent directors;

XVI. Revising provisions relating to the disqualification and vacation of the office of directors;

XVII. Clarifying the procedure for the resignation of key managerial personnel;

XVIII. Strengthening the provisions relating to mergers and amalgamations;

XIX. Easing the restoration of struck off companies by enabling the Regional Director to allow restoration of names of companies in certain instances;

XX. Recognising Special Purpose Acquisition Companies and allowing such companies, which are incorporated in India, to list on permitted exchanges;

XXI. Prohibiting the conversion of co-operative societies into a company;

XXII. Modernising enforcement and adjudication activities through electronic mode;

XXIII. Strengthening the incorporation and governance framework for Nidhis;

XXIV. Removing ambiguities from present provisions under the Companies Act, 2013 through changes of drafting & consequential nature

XXV. The incorporation of Producer Limited Liability Partnerships under the Limited Liability Partnership Act, 2008 to ease incorporation and compliance requirements for producer organisations.

Bipul Kumar