Manner of achieving minimum public shareholding

MPS norms: Readers may note that the Rule 19A of Securities Contract (Regulation) Rules, 1957  (operative from 04.06.2010) requires listed entities to have a minimum public shareholding (MPS) of 25% at all times. SEBI is continuously monitoring the achievement of minimum public shareholding by the listed companies and the effectiveness of the methods put in …

Practical Issues in Incorporation

Incorporation of companies is a process that is seemingly simple but involves many legal and procedural complexities. The following are some of the practical difficulties encountered: Challenges faced on account of reduced time limit in incorporation of companies where subscribers reside outside India With the amendment to Section 4 of the Companies Act, 2013 that …

ROD Order – Removal of Independent Directors (Reg.)

MCA has issued a Removal of Difficulties Order dated February 21, 2018, whereby an independent director appointed vide a Special Resolution for a second term can be removed only by passing a Special Resolution and not by the usual Ordinary Resolution. This is done by amending Section 169 - Removal of Directors, in order to …

PNB Fraud – The Story and Some Questions

Caught in the biggest banking-related fraud in India’s history, PNB, one of the largest PSBs, has been sending shock waves through the country, toppling investors’ and taxpayers’ confidence in the regulatory mechanism and the banking system. . We will see what has gone wrong, in the following paragraphs: 1. What is the quantum of the …

Draft New Rule in respect of Private Placement under Section 42

In line with the changes in the Companies (Amendment) Act, 2017 in respect of private placement, MCA has released the draft revised Rules under Chapter III of the Act. Changes in Section 42 - Private placement (Sec. 42) (not yet notified): Instead of ‘private placement offer letter’, a ‘private placement offer-cum-application’ as prescribed shall be …