Share Transfer Registration by Listed Companies

The Securities and Exchange Board of India [SEBI], India's top regulator for capital markets slashes the time lines for registering the transfer of shares to 15 days. What was 30 days until now, has become 15 days and Listed Companies have to be on their toes as any delay will enable the investor concerned to claim compensation by way of damages for opportunity losses suffered by investors due to delay in adhering to this time limit. this reduction was made by SEBI in consultation with Registrars Association of India called RAIN! This reduced time limit applies to debt securities too. Accordingly listing agreement for equity shares, listing agreement for SME Sector and Listing Agreement for debt securities have all been amended!

It rains in favour of the investors while compliance officers would face the music!


Refer SEBI Circular CIR/MIRSD/8 /2012 dated July 05 , 2012 


KSR

CHARGES - Condoning Delay in Filing Particulars of CHARGES

The powers of the Company Law Board [CLB] under Section 141 of the Companies Act, 1956 to condone delay in and extend the time limit for filing of particulars of charges and modifications thereof are going to shifted to Regional Directors [RDs] in the Ministry of Corporate Affairs [MCA]. This marks the beginning of a new era in this matter. Most of the cases requiring extension of time are very ordinary procedural matters where a company might default in filing particulars of charges within 30 days of its creation or modification and end up in moving the CLB with a Petition. Effective from 12th August 2012, these powers are going to be exercised by RDs. 

MCA may make this exercise still more simple by prescribing in the Rules, the filing of Form No.8 with RoC being automatically routed with RoC's report to RD and upon determination and notification of fee by RD and payment by Company, RoC may proceed to register the charge or modification of charge. This will be a better way of handling these jobs in GREEN ERA. However RDS will have the power to fix up a hearing and summon parties to seek explanations and clarifications on a case to case basis if the issues are complicated.

KSR

Shifting of Registered Office - Better to do after a month; save a couple of months!

If you are about to start compliance formalities for shifting of registered office from one state to another in India, you would be better by waiting for a month as 12th August 2012 will be the beginning of these confirmation powers being vested on the Central Government [CG] and Company Law Board [CLB] will no longer have the powers to do anything with respect to shifting of registered office. Presently under the Companies Act, 1956, if a company having its registered office in one State intends to move it to another State, such a move requires, apart from a special resolution [a resolution of shareholders enjoying three fourths of the votes polled], a confirmation from CLB. For this purpose, petition should be filed in accordance with CLB Regulations. This process will take normally about 3 to 4 months. However with the 10th July 2012 notifications of CG [to be precise, the Ministry of Corporate Affairs], the power to confirm the shifting of registered office will get transferred to Regional Directors. Wait and Watch!

KSR