The Joint Committee on the Corporate Laws Amendment Bill, 2026, chaired by Sudheer Gupta, a Member of Parliament in the Lok Sabha, has extended an invitation to experts, industry associations, organisations, and other stakeholders to submit their views and recommendations regarding the proposed legislation.
Submission Process
Interested parties are required to send two copies of their memoranda or suggestions, either in English or Hindi, addressed to the Director (JCL) at the Lok Sabha Secretariat.
Background of the Bill
The Corporate Laws (Amendment) Bill, 2026, was introduced in the Lok Sabha on March 23, 2026, by the Ministry of Corporate Affairs. Its primary objective is to amend the Companies Act, 2013 and the Limited Liability Partnership Act, 2008. The Bill places a strong emphasis on decriminalisation, easing compliance requirements, and expanding corporate flexibility.
Key Provisions
- Decriminalisation of Offences: The Bill proposes to replace imprisonment or fines with civil penalties for various violations, including wilful failure to provide information related to producer companies, contravention of rules, failure to submit required documents to the Registrar, violation of bookkeeping requirements, and non-compliance with Registrar requests other than summons.
- Corporate Social Responsibility (CSR): The net profit threshold for mandatory CSR spending is raised from Rs 5 crore to Rs 10 crore or other amount as prescribed. Companies meeting specified conditions may also be exempted from CSR obligations.
- Simplified Compliance: Companies will be allowed to serve documents electronically. Annual general meetings can be conducted physically or via video/audio-visual means, but at least one physical meeting must be held every three years. Firms meeting certain conditions will be exempt from appointing an auditor. Some affidavits will be replaced with self-declarations.
- Expanded Definition of Small Companies: The paid-up share capital limit for small companies is increased from Rs 10 crore to Rs 20 crore, and the turnover limit from Rs 100 crore to Rs 200 crore, thereby easing compliance for more firms.
- Merger Approval Threshold: For mergers, approval will require a majority of members present and voting, holding at least 75% of shares, instead of the current 90% of total shareholders. The creditor approval threshold is also reduced from 90% to 75%.
- Other Amendments: The Bill permits buy-back up to a prescribed percentage for certain classes of companies, designates the Insolvency and Bankruptcy Board of India (IBBI) as the Valuation Authority to register valuers and set standards, and expands the National Financial Reporting Authority's (NFRA) powers to issue advisories, censure, or warnings. It also recognises employee compensation schemes beyond stock options, such as Restricted Stock Units and Stock Appreciation Rights. For Limited Liability Partnerships (LLPs), specified trusts registered with SEBI or IFSC Authority engaged in prescribed activities can convert into LLPs.
