Copy of the LLP (Amendment) Bill, 2021 as introduced in the Rajya Sabha
Editorial Note: LLP (Amendment) Bill, 2021 has been proposed to facilitate greater ease of living to law abiding corporates and to decriminalise certain provisions of the LLP Act. The amendment bill seeks to introduce the concept of ‘small LLP’ in line the concept of ‘small companies’ under the Companies Act, 2013. The Bill Empowers Govt. to prescribe ‘Accounting Standards’ and ‘Auditing Standards’ for classes of LLPs. Bill also empowers Govt. to establish ‘special courts’. 91% MSMEs were found to be functional during pandemic as per study conducted by NSIC
Editorial Note : The Studies have been conducted by National Small Industries Corporation (NSIC) and Khadi and Village Industries Commission (KVIC) to assess the impact of COVID-19 Pandemic on MSMEs. As per the finding, 91% MSMEs were found to be functional and Five most critical problems faced by MSMEs were identified as Liquidity (55% units), Fresh Orders (17% units), Labour (9% units), Logistics (12% units) and availability of Raw Material (8% units).
PRESS RELEASE, DATED, 27-07-2021
Government identified 2,38,223 shell companies between 2018-2021: Union Minister of State for Corporate Affairs
Editorial Note: Union Minister of State for Corporate Affairs Shri Rao Inderjit Singh in written reply to a question in Rajya Sabha informed that Govt. has identified total 2,38,223 companies as shell companies between 2018-2021. The Minister further stated that the Special Task Force set up by the Govt. to look into the issue of “Shell Companies” has recommended use of certain red flag indicators to identify Shell Companies. CIRCULAR NO. SEBI/HO / IMD / IMD – II
DOF3/P/CIR/2021/604, DATED 26-07-2021
SEBI asks RTA to implement ‘Inter-Operable Platform’ for enhancing investors’ experience in Mutual Fund transactions
Editorial Note: In order to make it more convenient to the existing and future investors to transact and avail services while investing in Mutual Funds, the SEBI has asked RTA to implement standardized practices, system interoperability amongst themselves to jointly develop a common industry-wide platform that will deliver an integrated, harmonized, elevated experience to the investors across the industry platform.CIRCULAR NO. SEBI/HO/DDHS/DDHS_DIV3/P/CIR /2021/599, DATED 22-07-2021
All complaints to be disclosed on website of InvIT/ REITs
Editorial Note: In order to further enhance investor protection and to increase transparency in grievance redressal, the SEBI has suggested that all complaints including SCORES complaints received by the InvIT/ REITs shall be disclosed in the specified format on the website of the InvIT/ REITs and also filed with the recognized stock exchange(s), where its units are listed within 21 days from the end of financial year or end of quarter, as the case may be.”CIRCULAR NO. SEBI/HO/ MIRSD/CRADT/CIR/P/2021/597, DATED 20-07-2021
SEBI further extends timelines for compliance with regulatory requirements by Debenture Trustees
Editorial Note: In view of the prevailing situation due to Covid-19 pandemic and representations received from the Debenture Trustees, the SEBI has decided to further extend the timelines for compliance with the regulatory requirements by Debenture Trustees for the quarter/ half year/ year ending March 31, 2021, up to October 31, 2021CIRCULAR NO. SEBI/HO / MRD2_DCAP/CIR/2021/0598, DATED 20-07-2021
SEBI unveils framework for segregation and monitoring of collateral at client level
Editorial Note: In light of the public comments and discussions with the stakeholders, the SEBI has decided to adopt the framework for segregation and monitoring of collateral at the client level. In the new framework, A web portal facility shall be provided by the Clearing Corporations/ Stock Exchanges to allow clients to view aforesaid disaggregated collateral reporting by TM/CM.CIRCULAR NO. SEBI/HO/ MIRSD/MIRSD_CRADT/P/CIR/2021 /594, DATED 16-07-2021
SEBI presents ‘Expected Loss’ based rating scale for rating infra projects/instruments by credit rating agencies
Editorial Note: In addition to the standardized rating scales and subsequent to discussions with various stakeholders, the SEBI has
prescribed Expected Loss (EL) based Rating Scale to be used by CRAs for ratings of projects/ instruments associated with infrastructure sector to begin with. SEBI has prescribed Rating symbols E1 to E7 where instruments rated ‘E1’ are considered to have the lowest expected loss, over the life of the instrument and E7 rated to have highest expected loss.CIRCULAR NO. SEBI/HO/MIRSD/DOP/P/CIR/2021/ 595, DATED 16-07-2021
SEBI unveils block mechanism of Demat account of clients undertaking sale transactions
Editorial Note: To protect the interests of investors in securities and promote the development of the securities markets, the SEBI had extensive consultations with Depositories, Clearing Corporations and Stock Exchanges to provide a mechanism of block in the demat account of clients undertaking sale transactions. This mechanism will do away with the movement of shares from client’s demat account for early pay-in and back to the client’s Demat account if a trade is not executed.CIRCULAR NO. SEBI/HO/IMD/DF4/P/CIR/2021/593, DATED 09-07-2021
Now Mutual Funds to provide justification to stakeholders if put option favourable to scheme is not exercised
Editorial Note: Based on recommendation of Mutual Fund Advisory committee, the SEBI has decided that, with effective from Oct 01, 2021 if put option is not exercised by a Mutual Fund, while exercising the put option would have been in favour of the scheme then a justification for not exercising the put option shall be provided by the Mutual Fund to the Valuation Agencies (VA), Board of AMC and Trustees on or before the last date of notice period.
PRESS RELEASE DATED, 09-07-2021
NFRA extends last date for submitting public comments on consultation paper Enhancing Engagement with Stakeholders
Editorial Note: The National Financial Reporting Authority (NFRA) has extended the last date for submission of comments on its Consultation Paper titled “Enhancing Engagement with Stakeholders: Report of Technical Advisory Committee from July 10, 2021 to July 30, 2021. Consultation paper may be viewed at https://nfra.gov.in/consultation_pape rs. The comments may either be submitted by email at comments-tac.paper @nfra.gov.in or sent by post to NFRA Office at Delhi.
NOTIFICATION NO. NO. 1-CA(7)/197/2021, DATED 08-07-2021
ICAI notifies revised Form 18 under CA Regulations; enables multidisciplinary partnership with other professionals
Editorial Note : The ICAI, on July 08, 2021 has notified the revised Form 18 i.e. disclosure of particulars relating to office and firms under the Chartered Accountants Regulations, 1988 (‘CA regulations’) With the modification in form 18, CA firms are now allowed to have partnership with CMAs, CSs, Advocates, Engineer, Architects, MBA, others permitted under section 53 B of the CA Regulations. The revised form also seeks details relating to PAN and GSTCIRCULAR NO . SEBI/HO/CDMRD_DOP/P/CIR/202 1/592, DATED 08-07-2021
SEBI reduces advance intimation timeline for modifications in commodity derivative contract
Editorial Note: In order to bring in uniformity while giving effect to the contract modifications so that they have the desired impact and the modified contract represents a healthy replica of the physical market, the SEBI has decided, in consultation with the Stock Exchanges, to reduce the number of days of advance intimation for all the three categories i.e. Non -material, material and Material modifications which can be made only after approval from SEBI, to 10 days.CIRCULAR NO. SEBI/HO/CFD / DIL1 / CIR/ P / 2021 / 0585, DATED 06-07-2021
SEBI issues SOP for company getting delisted through scheme of arrangement
Editorial Note: The market regulator, SEBI has issued Standard Operating Procedure for listed subsidiary company desirous of getting delisted through a Scheme of Arrangement wherein the listed parent holding company and the listed subsidiary are in the same line of business.
NOTIFICATION NO. J-10/9/2018-O/O DS (CPU), DATED 30-06-2021
Govt. drafts norm to regulate direct selling entities; proposes banning of pyramid and money circulation scheme
Editorial Note: The Ministry of Consumer Affairs, Food and Public Distribution has issued the draft Consumer Protection (Direct Selling) Rules, 2021. The draft rules propose to ban direct selling entities to offer pyramid scheme and money circulation scheme. Also direct selling entities have to register with the Department for Promotion of Industry and Internal Trade (DPIIT) for allotment of registration number. The norms proposes that direct selling entity shall have atleast one office in India.
CIRCULAR NO. SEBI/HO/OIAE/ IGRD/CIR/P/2021/588, DATED 05-07-2021
SEBI reduces time period for ‘NoC applications’ from 4 to 2 months
Editorial Note: The SEBI has decided to reduce the time period after listing for submitting the application for NOC to release issue amount 2 months from the existing period of 4 months as stated in guidelines However, the time period is subject to the condition that all issue related complaints have been resolved by the merchant banker/ issuer.CIRCULAR NO. SEBI/HO/MIRSD/DOP/P/CIR/2021/ 587, DATED 30-06-2021
SEBI further extends timelines for compliance with regulatory requirements by trading members
Editorial Note: In view of the prevailing situation due to Covid-19 pandemic and representation received from Stock Exchanges, the SEBI has decided to extend the timelines for compliance with the regulatory requirements by the Trading Members / Clearing Members / KYC Registration
Agencies such as maintaining call recordings of orders/ instructions received from clients, Client Funding Reporting, KYC application forms and so on.
CIRCULAR NO. SEBI/HO/MRD1 /DTCS/CIR/P/2021/590, DATED 05-07-2021
SEBI issues SOPs for handling of technical glitches by ‘Market Infrastructure Institutions’
Editorial Note: In consultation with various stakeholders for smooth functioning of Market Infrastructure Institutions (MII), The SEBI has decided that MII shall follow the SOPs of technical glitches and payment of financial disincentive. This will encourage MIIs to constantly monitor the performance and efficiency of their systems and upgrade their systems to avoid any possibility of technical glitches.GENERAL CIRCULAR NO. 12/2021, DATED 30-06-2021
Now companies can file charge -related forms without paying an additional fee up to August 01, 2021
Editorial Note: In view of the large-scale disruption caused by the COVID-19 pandemic and after due examination of the representations received from various stakeholders, the MCA has decided to relax the timelines for filing of forms related to the creation/modification of charges. As a result, companies can file charge-related forms without paying an additional fee up to August 01, 2021.
GENERAL CIRCULAR NO. 11/2021, DATED 30-06-2021
MCA further extends due date upto August 31, 2021 for filing certain forms under Cos Act and LLP Act
Editorial Note: The MCA has further granted extra time upto August 31, 2021 to companies/LLPs to file forms under the Companies Act, 2013/LLP
Act, 2008 (other than a CHG-1 Form, CHG-4 Form and CHG-9 Form) which were/are due for filing during April 1, 2021 to July 31, 2021 without any additional fees.
PRESS RELEASE NO.22/2021, DATED 29-06-2021
SEBI nods to merger of ‘Issue and listing debt securities’ norms and ‘NCDR-preference share’ norms into a single rule
Editorial Note: The SEBI Board has considered and approved the proposals relating to the review and merger of the SEBI (Issue and Listing of Debt Securities) Regulations, 2008 and SEBI (Non-Convertible Redeemable Preference Shares) Regulations, 2013 into a single Regulation to be called– SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021. In addition, the restriction of not more than four issuances of debt securities in a year through a single shelf prospectus has been done away with.
NRIs must obtain registration under ‘Investment advisory’ regulations for offering advisory services in India: SEBI
Editorial Note: The SEBI has issued informal guidance with the regard to registration in ‘Investment advisory’ (IA) regulation. It has clarified that NRI or POI intends to offer investment advisory to clients in India needs to take registration under IA regulations. In case NRI or POI wants to join any non-individual IA as PAA, then non- individual IA is required to comply with IA regulations.
CIRCULAR NO. SEBI/HO/CDMRD/ CDMRD_DRM/P/CIR/2021/586, DATED 29-06-2021
SEBI introduces cross margin facility on commodity futures
Editorial Note: In order to improve the efficiency of the use of the margin capital by market participants, the SEBI has decided to introduce cross margin benefit between Commodity Index futures and futures of its underlying constituents or its variants. This shall reduce the cost of trading and may lead to enhanced liquidity in both the Commodity index futures and its underlying constituent futures or its variants.
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