Sunday, September 25, 2016

09 - Legal & Regulation Updates - India

 Compliance Watcher

SEBI – Master Circular for Mutual Fund
The Securities Exchange Board of India (“SEBI”), has issued a Master Circular dated September 14, 2016, for Mutual Funds. This master circular is a compilation of all circulars issued by SEBI on mutual funds which are in operation as on date i.e. September 14, 2016.

SEBI - Standardization and Simplification of Procedures for Transmission of Securities
The Securities Exchange Board of India (“SEBI”), vide a Circular dated September 15, 2016 has modified Clause 2 of Annexure A, of the circular dated October 28, 2013 pertaining to requirement of documents for securities held in physical mode and which are held in single name without a nominee.

IRDAI- On-line examination for Surveyors and Loss Assessors.
The Insurance Regulatory and Development Authority of India (IRDAI) vide circular dated September 15, 2016 has decided to conduct on-line examination for grant of license for Surveyors and Loss Assessors from the next financial year i.e. FY 2017-18.

Food Safety and Standards (Packaging and Labelling) Fourth Amendment Regulations, 2016
The Ministry of Health and Family Welfare via notification dated August, 23rd  2016 has issued Food Safety and Standards (Packaging and Labelling) Fourth Amendment Regulations, 2016  to amend the Food Safety and Standards (Packaging and Labelling) Regulations, 2011.

In Regulation 2.4 of Food Safety and Standards (Packaging and Labelling) Regulations, 2011:

  • Sub-regulation 2.4.4 relating to “Labelling of Irradiated Food” shall be omitted.
  • The Sub-regulation 2.4.5 relating to “Specific Labelling Requirements of other Products” shall be re-numbered as 2.4.4

Food Safety and Standards (Food Products Standards and Food Additives) Seventh Amendment Regulations, 2016
The Ministry of Health and Family Welfare via notification dated September 5, 2016 has issued Food Safety and Standards (Food Products Standards and Food Additives) Seventh Amendment Regulations, 2016 amending the Food Safety and Standards (Food Products Standards and Food Additives) Regulations, 2011.

Central Motor Vehicles (10th Amendment) Rules, 2016
The Ministry of Road Transport and Highways, via notification dated September 14, 2016, has issued the Central Motor Vehicles (10th  Amendment) Rules, 2016 to amend the Central Motor Vehicles Rules, 1989.
  • In Rule 124A, Sub-rule (2), after the first proviso, the following proviso is inserted:
  • In Rule 126, in the first proviso, after the words “as amended from time to time” occurring at the end the following words, letters, figures and brackets shall be inserted: “and information on technical specifications shall be submitted by the vehicle manufacturer in accordance with AIS-007(Rev.5):2014”

Central Motor Vehicles (11th Amendment) Rules, 2016
The Ministry of Road Transport and Highways, via notification dated September 16, 2016, has issued the Central Motor Vehicles (11th  Amendment) Rules, 2016 to amend the Central Motor Vehicles Rules, 1989.
  • In Rule 115, Sub-rule (2) in clause (i) and clause (ii) “in the proviso, for the entry “Bharat Stage-IV”, wherever it occurs, the entry “Bharat Stage IV or Bharat Stage VI ” shall, respectively, be substituted”.
  • “Sub-rule (7) in the proviso, for the entry “Bharat Stage-IV”, the entry “Bharat Stage IV or Bharat Stage VI ” shall be substituted. “
  • In Rule 115, after Sub-rule (17) the following sub-rules shall be inserted:
  • “18) (i)The Emission Standards for Bharat Stage VI (BS-VI) for category M and N vehicles having Gross Vehicle Weight not exceeding 3500kg, manufactured on or after 1st April 2020 for all models.”

Drugs (Price Control) Amendment Order, 2016
The National Pharmaceutical Pricing Authority, through a Order dated September 15, 2016, has fixed the ceiling prices of 18 Scheduled formulations of Schedule-I under Drugs (Price Control) Amendment Order, 2016 and Retail price of 21 formulations under DPCO, 2013.

NSE & BSE - Clarification by SEBI regarding Revenue Recognition and Excise Duty
The National Stock Exchange (“NSE”) and Bombay Stock Exchange (“BSE”), have issued clarification letters dated September 20, 2016 with respect to circulars issued by Securities Exchange Board of India (“SEBI”) dated November 30, 2015 and July 5, 2016. The SEBI circulars were issued, pertaining to ‘Formats for publishing financial results’ and ‘Revised Formats for Financial Results and Implementation of Ind-AS by Listed Entities’ respectively.

In consonance to the above said Circular and Notification, SEBI issued another Circular dated July 5, 2016, stating that in case of any technical difficulty in interpretation of the formats or implementation of this Circular, listed entities shall be guided by the relevant provisions of the Ind-AS Rules / AS Rules and Schedule III of the Act.

SEBI - Consolidated Account Statement
The Securities Exchange Board of India (“SEBI”), vide a Circular dated September 20, 2016 has partially modified Clause A of Circular dated March 18, 2016 pertaining to half-yearly Consolidated Account Statement (“CAS”).

As per the Circular dated September 20, 2016, a mention may be made in half-yearly CAS indicating that the commission disclosed is gross commission and it does not exclude costs incurred by distributors such as service tax (wherever applicable, as per existing rates), operating expenses, etc.

Further, an indicative format providing guidance on the key components which shall be reflected in CAS is attached.

The provisions of this Circular will be effective for CAS issued from October 01, 2016.

SEBI - Staggered delivery, early delivery system, early pay-in facility, penalty on delivery default, fixation of FSP and changes in expiry dates
The Securities Exchange Board of India (“SEBI”), vide a Circular dated September 21, 2016 has consolidated and updated the norms for early delivery as well as pay-in facility and penalty on sellers in case of delivery default which were prescribed for National Commodity Derivatives Exchanges by the erstwhile Forward Markets Commission (“FMC”). It has also put in place measures such as staggered delivery system, fixation of final settlement price (“FSP”) and change in expiry date.

Central Motor Vehicles (Twelfth Amendment) Rules, 2016
The Ministry of Road Transport and Highways, via notification dated September 21, 2016, has issued the Central Motor Vehicles (Twelfth  Amendment) Rules, 2016 to amend the Central Motor Vehicles Rules, 1989.

  • In Rule 125(C ), Sub-rule (1) the proviso is substituted-
“Provided that the provision of this rule shall be implemented in two phases.
  • In first phase, the provisions of AIS 052(Rev. 1) – 2008, excluding the parameters and requirements given in Table-1, shall be applicable on and after 1st day of January, 2017.
  • In second phase, the provisions of AIS-052(Rev. 1) – 2008, as amended from time to time, and the parameters and requirements given in (Table-1), shall be applicable on and after 1st day of January, 2018.”

Employees State Insurance Corporation- Achievements/Initiatives during past two years
The Employees State Insurance Corporation via press release dated September, 15th 2016 has stated the achievements/Initiatives of ESIC during past two years.

ESIC has taken a number of new initiatives in order to extend the social security coverage of ESI Scheme and to improve the medical care being provided under the ESI Scheme.

National Pharmaceutical Pricing Authority (NPAA) - draft version of 19 Proposed Price Calculation Sheets
Via Office Memorandum dated September 21, 2016 NPPA has released the draft version of proposed price calculation sheets for 19 proposed revised/notified ceiling price/retail price on the website of NPPA. Draft of 19 calculation sheets based on Pharma Trac data are uploaded on the website.

All the companies aggrieved by NPPA’s proposed price fixation, can make representations against the proposed ceiling price/retail price by submitting documents /information of price to retailer (PTR) and Moving Annual Turnover (MAT) data along with supporting documents like copies of sample invoices to retailer and samples of August, 2015 duly attested with name, designation, mobile no, signature and seal of the authorized officer of the company along with the summary of all the invoices issued during the month of August 2015 (giving details like Invoice No. , Date, Name of Distributor, & Retailer, quantity, pack size, PTR (excluding VAT), Discounts/Free goods, (if any) and copies of supporting Form V/IPDMS, within 10 working days to NPPA in order to take necessary action in this regard.

Central Drugs Standard Control Organization-Online portal SUGAM
The Central Drugs Standard Control Organization Directorate General of Health Services, has issued a Notice dated September 21, 2016 relating to implementation of e-Governance on launching of the portal.

The Portal is intended for filing applications for various services rendered by CDSCO. In first phase filing of applications import and registrations of drugs, Medical devices were launched. Now the service is being extended to applications of BA/BE NOC for export.

Further it is decided to convene a meeting with all stakeholders i.e., firms involved in applications of BA/BE NOC for Export, to attend the said meeting to be held on 23rd September 2016 at 10.30 AM, FDA Bhawan, New Delhi for their inputs, in order to streamline the online system for BA/BE NOC.

Drugs and Cosmetics (Sixth Amendment) Rules, 2016
The Ministry of Health and Family welfare  via notification dated September, 21st   2016 has issued the Drugs and Cosmetics (Sixth Amendment) Rules, 2016 to amend the Drugs and Cosmetics Rules, 1945.

  • In Schedule D(I), in item 2, for “sub-item 2.3” the following is substituted-

“2.3 A copy of Good Manufacturing Practice (GMP) certificate as per WHO – GMP guidelines or Certificate of Pharmaceutical Products (CPP) or written confirmation for active substances exported to European Union which is equivalent to GMP certificate issued as per WHO – GMP guidelines, by the National Regulatory Authority of the country of origin or a copy of the certificate equivalent to GMP certificate as per WHO GMP guidelines issued by National Regulator of United States of America or Japan or Australia or Canada or the European Union for the purpose of marketing of the drugs in their country, in relation to bulk drugs or formulations or special product meant for import into India.”
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