20 - Legal & Regulation Updates - India
SEBI: Revision of formats and time period for submission of draft
offer of letter ("DLOF")
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SEBI
has issued a Circular dated March 15, 2017, through which the time period and
formats for submission of DLOF are revised. This Circular is in furtherance
of the previous circulars dated November 22, 2011 and September 23, 2011
which dealt with the SAST Regulations, 2011 and consequential amendments to
Clause 35 of the Equity Listing Agreement.
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SEBI - Amendments to SEBI (Mutual Funds) Regulation, 1996 and related
Circulars
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SEBI
via Circular dated March 15, 2017 has amended the following:
1. Existing Circular to review the advertisement guidelines for Mutual Funds; 2. Introduction of new Provisions called Celebrity endorsements in the existing Circular regarding Investor Education. |
SEBI - Disclosures relating to regulatory orders and arbitration
matters by Clearing Corporations
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SEBI
via Circular dated March 16, 2017 has made Provisions regarding disclosure of
the regulatory orders and arbitration awards issued by Corporations to improve
the transparency by making this information available to the investors. The
key highlights of these Provisions are as follows:
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SEBI: Interpretive Letter issued by SEBI concerning the rejection of
Application by the Compliance Officer
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SEBI
has issued an Interpretive Letter as requested by KCPL and KBL under the SEBI
(Informal Guidance) Scheme 2003 with regard to PIT Regulations.
Accordingly, SEBI has informed that the Compliance Officer as specified under the PIT Regulations cannot reject an Application for pre-clearance of trading by the Promoter Group, as the same is cannot be denied under the SEBI (Substantial Acquisition of Shares and Takeover) Regulations, 2011 (“SAST Regulations”), the PIT Regulation or Section 58 of the Companies Act, 2013, which allows free transferability of shares. |
RBI launches a Mobile Application
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The
RBI has launched a mobile application (app) version of the RBI’s website. The
app is available on Android as well as iOS platforms and can be downloaded from
the Play Store or App Store, using the keyword “Reserve Bank of India”.
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IRDAI: Exposure draft on Preparation of Financial Statement of
Insurers, 2017
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IRDAI
has issued an Exposure Draft on Preparation of Financial Statement of
Insurers.
The following are the key proposals of the Draft Regulation: Applicability: These guidelines will be applicable to an insurer holding certificate of registration granted by the Authority. |
IRDAI: Amendment in Guidelines on Pont of Sales Person - Non-Life and
Health
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The
Guidelines on Pont of Sales Person - Non-Life and Health dated 26th October,
2015 were issued by IRDAI to regulate appointment and eligibility of Point of
Sale Persons. The condition enumerated in the guideline for Point of Sale person
with relation to training from and passing of NIELIT examination is being
dispensed with.
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IRDAI: Guidelines on Stewadship Code for Insurers in India
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Object:
As a result of significant increase in the funds received by insurance
companies and increase in the number of investors in the securities markets
who invest on behalf of the policyholders there was a need to regulate
insurers by introducing principles of stewardship which in turn improve the
confidence of the policyholders in the insurers on one hand and also ensure
better corporate governance and decision making at investee companies on the
other.
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Fixed Provident Fund Administrative Charges w.e.f. April 1, 2017
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The
Ministry of Labour and Employment has issued notifications S.O. 827(E) and
S.O. 828(E) fixing administrative charges under the Employee Provident Fund
Scheme,1952. The notification will come into effect from April 1, 2017.The
notifications makes the following changes:
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Press Information Bureau, Government of India
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The Central Goods and Services Tax Bill 2017, The Integrated Goods and
Services Tax Bill 2017, The Union Territory Goods and Services Tax Bill 2017
and The Goods and Services Tax (Compensation to the States) Bill 2017.
The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi, has approved the following four GST related bills. |
SEBI -
Securities Contracts (Regulation) Amendment Rules, 2017
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SEBI via Notification dated
March 20, 2017, has amended the following:
1. Proviso to Rule 8(4)(iii), which, on the recommendation of SEBI, allows the governing body of Stock Exchange to admit certain corporations, bodies corporate, Companies or institutions as members of recognized Stock Exchange has been omitted. Rule 8 pertains to qualifications for membership of a recognized Stock Exchange. |
SEBI:
Exclusively listed companies of De-recognized/Non-operational/exited Stock
Exchanges placed in the Dissemination Board (DB)
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SEBI via Circular dated
March 27, 2017 has extended the period for ELCs for submission of plan of
action with respect to listing on a Nationwide Stock Exchange or to provide
exit options to shareholders. The extension has been provided till June 30,
2017. All the other conditions as mentioned in the original Circular dated
October 10, 2016 will be the same.
ELCs have been granted additional 3 months to submit their action plan to list on the Nationwide Stock Exchange or to provide exit offer to the investors. |
MCA:
Exemptions given from the purview of "Combination" under Section 5,
Competition Act, 2002
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Section 4 of the
Competition Act, 2002 defines what constitutes a “Combination” under the Act
and further, Section 6 of the Act regulates parties entering into such
combinations. The term ''combination'' for the purposes of the Competition
Act,2002 is defined to include any acquisition of shares, voting rights,
control or assets or merger or amalgamation of enterprises, where the parties
to the acquisition, merger or amalgamation satisfy the prescribed monetary
thresholds in relation to the size of the acquired enterprise and the
combined size of the acquiring and acquired enterprises. Such is calculated
in relation with assets and turnover of such enterprises.
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Pre-Legislation
Alert: Lok Sabha approves four GST Bills
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The Central Goods and
Services Tax Bill 2017, The Integrated Goods and Services Tax Bill 2017, The
Union Territory Goods and Services Tax Bill 2017 and The Goods and Services
Tax (Compensation to the States) Bill 2017.
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Maternity
Benefit (Amendment) Act, 2017
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This Maternity Benefit
(Amendment) Act, 2017 has been notified on March 28, 2017. The Act brings
significant changes such as enhancing maternity leave, providing crèche
facilities in organizations with 50 or more employees and other such
provisions empowering working women.
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CBDT:
Clarifications on Income Computation and Disclosure Standards (ICDS)
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As per the authority given
under Rule 145 of the Income Tax Rules, CBDT had set 10 standards for
computation of Income under Income Computation and Disclosure Standards
(“ICDS”). ICDS is to be followed while computing Income chargeable under the
head "Profits and gains of business or profession" or "Income
from other sources." The ICDS norms were initially notified with effect
from financial year 2015-16 but its implementation was deferred by a year to
2016-17 after taxpayers expressed concern over some of the provisions. The
CBDT has issued a clarification in the form of Frequently Asked Questions
(“FAQs”) on ICDS to address queries raised by companies over its
implementation.
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Instructions
to facilitate payment of Provident Fund for International Workers
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The Ministry of Labour and
Employment has issued a circular providing instructions facilitating payment
of Provident Fund (“PF”) and Withdrawal benefit under Employees Pension
Scheme, 1995 for International workers . These instructions have been issued
to make sure that International workers get their PF amount promptly before
leaving India. The instructions are as follows :
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Central
Ground Water Authority: Submission of application for using ground water
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The Hon’ble National Green
Tribunal vide its Order dated 9th July 2015 and Judgment (Asim Sarode &
Others Vs District Collector Nanded & Others) dated 11th January 2016 has
issued directions to ensure that all existing, new and expansion of
Industries/projects extracting ground water are mandated obtain permission
from Central Ground Water Authority.
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IRDAI:
Modification in premium rates under Payment of commission or remuneration or
reward to insurance agents and insurance intermediaries Regulations, 2016
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The abovementioned
regulations were introduced for revising the payment/commission/remuneration
or reward given to insurance agents and insurance intermediaries. Considering
the above modifications, the insurers may feel the need to change the pricing
of their products. IRDAI has vide a circular stating that those general
insurers who wish to revise the pricing of their products may do so without
filing a modification to the product under product filing guidelines which is
otherwise mandated. However, the above exemption is given subject to the
following conditions:
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IRDAI:
Calculation of Solvency Margin under IRDAI (Assets, Liabilities, and Solvency
Margin of General Insurance business) Regulations, 2016
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IRDAI (Assets, Liabilities,
and Solvency Margin of General Insurance business) Regulations, 2016 lays
down various provisions which are to be adhered to by General Life Insurers
for the calculation of Solvency Margin. The Solvency Margin is the excess of
an insurer''s assets over its liabilities and the modes for calculation of
the same is set by regulator. The regulations further lay down guidelines for
admissible assets as well as admissible liabilities for the calculation of
Solvency Margin.
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IRDAI:
Insurance Regulatory and Development Authority of India (Insurance Brokers)
Regulations, 2017
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As a
result of the Insurance Laws (Amendment) Act, 2015 and given the nature of
the changes that have taken place in the Insurance Market, IRDAI has issued draft
regulations to replace the existing Broker Regulations.
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