Besides strengthening the provisions to check fraud, the Bill has introduced ideas like mandatory CSR, class action suits and a fixed term for independent directors. The Bill also seeks to prohibit any insider trading by company directors or key managerial personnel by treating such activities as a criminal offence
New Delhi: The Cabinet on Thursday approved the Companies Bill, 2011, which aims to update corporate laws in the country and introduce modern concepts like mandatory corporate social responsibility (CSR) and class action suits, reports PTI.
Intended to replace the existing half-a-century-old Companies Act, the Bill has undergone several modifications in view of the Rs14,000 crore Satyam accounting fraud.
Following Cabinet clearance, it is now likely to be taken up for consideration and passage in the ongoing Winter Session of Parliament.
“Cabinet has cleared the Companies Bill, 2011. It is likely to be tabled (for consideration and passage) in the ongoing Winter Session,” a corporate affairs ministry official said.
Besides strengthening the provisions to check fraud, the Bill has introduced ideas like mandatory CSR, class action suits and a fixed term for independent directors.
Among other things, it also proposes to tighten laws for raising money from the public. The Bill also seeks to prohibit any insider trading by company directors or key managerial personnel by treating such activities as a criminal offence.
Further, it has proposed that companies should earmark 2% of their average profits of the preceding three years for CSR activities and make a disclosure to shareholders about the policy adopted in the process.
Welcoming the Cabinet decision, industry body Confederation of Indian Industry (CII) said that on enactment, the Companies Bill will be a boon for business, corporates, investors and stakeholders at large.
“Industry anxiously awaits a new corporate law that would lay stress on responsible self-regulation. Needless to say, the new company law is expected to be more streamlined and facilitative,” CII director general Chandrajit Banerjee said
The new law would strengthen the concept of shareholders’ democracy and offer protection of the rights of minority stakeholders.
The law also proposes to introduce responsible self-regulation replete with disclosures and accountability.
It will also facilitate the transition of controls currently exercised by the government over internal corporate processes and decisions to shareholders.
In addition, the Bill seeks to give more teeth to the Serious Fraud Investigation Office (SFIO) by providing it statutory recognition and endowing it with more powers.
The Bill, which was originally introduced in the Lok Sabha in 2008, lapsed because of the change of government. It was reintroduced in August 2009.
The EAG is a Financial Action Task Force-styled regional body with nine members —including India, Russia and China—and 29 observers, of which 12 are countries and 17, are international organisations
New Delhi: India on Thursday signed an agreement with the Eurasian Group (EAG), a regional body, to enhance cooperation on curbing money laundering and terrorist financing, reports PTI.
The agreement was signed by Thomas Mathew, joint secretary of the Capital Markets Division of the ministry of finance, on behalf of India on the occasion of the 15th plenary meeting of the group at Xiamen, China, an official statement said.
The Cabinet had approved the agreement earlier this month, it added.
The EAG is a Financial Action Task Force (FATF)-styled regional body with nine members —including India, Russia and China—and 29 observers, of which 12 are countries and 17 are international organisations.
During the conference, India offered help to member nations in enhancing their technical skill in establishing better financial systems, capital market monitoring and surveillance through sophisticated IT tools.
“Help was also offered in drafting legislation, law enforcement techniques and strengthening of their respective financial intelligence units,” the finance ministry said in a statement.
India was accorded membership in the group in December 2010. There are nine such regional bodies spread across the world. The Eurasian Group is emerging as an effective body engaged in combating money laundering and the financing of terrorism, it added.
The rupee, which fell to an all-time low of Rs52.73 per dollar on 22nd November, has lost around 15% in 2011, with investors seeing the US currency and treasury papers as safe haven investments amid global market uncertainty
Mumbai: The Indian rupee’s slide is likely to continue and the currency could fall to Rs58 per US dollar in the near-term if the economic situation in the Eurozone deteriorates further, reports PTI quoting an HSBC Bank official.
“The rupee is likely to depreciate further and touch a level of Rs58 against the US dollar in the near-term if Eurozone nations don’t find a credible solution to their debt woes,” HSBC Bank India and Asean chief economist Leif Eskensen said here.
He added that the high inflationary environment and a possible slowdown in gross domestic product (GDP) growth will also contribute to the downslide of the domestic currency. “This will happen despite intervention by the RBI,” he said, without giving any specific time-frame.
The rupee, which fell to an all-time low of Rs52.73 per dollar on 22nd November, has lost around 15% in 2011, with investors seeing the US currency and treasury papers as safe haven investments amid global market uncertainty.
Officials of the bank also said tackling inflation and the gradual increase of the fiscal deficit could prove tricky for the domestic economy amid the ongoing sovereign debt crisis in the Eurozone.
“Inflation is a serious problem for the domestic economy in comparison to other emerging countries and it is still not under check despite monetary squeezing,” Mr Eskesen said.
The HSBC official, however, said India is a domestic-consumption driven growth story and would not be impacted as much as export-driven economies of the world.