The Ministry of Corporate Affairs (“MCA”) has recently on May 23, 2019 announced changes to the Prospectus Rules by way of the Companies (Prospectus and Allotment of Securities) Third Amendment Rules, 2019 (“Amendment”).
The Amendment will gain effect from September 30, 2019.
| Present Position | Amended Position once it will gain effect from 30th September, 2019 | Implication |
| Rule 9A. Issue of securities in dematerialised form by unlisted public companies.-
… (7) Except as provided in sub-rule (s), the provisions of the Depositories Act 1996 the Securities and Exchange Board of India (Depositories and participants) Regulations, 1996 and the securities and Exchange Board of India (Registrars to an Issue and share Transfer Agents) Regulations, 1993 shall apply mutatis mutandis to dematerialisation of securities of unlisted public companies. |
Rule 9A. Issue of securities in dematerialised form by unlisted public companies.-
… (7) Except as provided in sub-rule (s), the provisions of the Depositories Act 1996 the Securities and Exchange Board of India (Depositories and participants) Regulations 1996 Regulations, 2018and the securities and Exchange Board of India (Registrars to an Issue and share Transfer Agents) Regulations, 1993 shall apply mutatis mutandis to dematerialisation of securities of unlisted public companies.
|
The reference to the Securities and Exchange Board of India (Depositories and Participants) Regulations, 1996 is being done away with.
As you will be aware, in view of the Securities and Exchange Board of India (Depositories and Participants) Regulations, 2018 which has gained effective since 3rd October, 2018 the Securities and Exchange Board of India (Depositories and Participants) Regulations, 1996 stood repealed. Hence, sub-rule (7) of Rule 9A has been updated accordingly. |
| (8) The audit report provided under regulation 55A of the Securities and Exchange Board of India (Depositories and participants) Regulations, 1996 shall be submitted by the unlisted public company on a half-yearly basis to the Registrar under whose jurisdiction the registered office of the company is situated. | Substituted as follows:
(8) Every unlisted public company governed by this rule shall submit Form PAS-6 to the Registrar with such fee as provided in Companies (Registration Offices and Fees) Rules,2014 within sixty days from the conclusion of each half year duly certified by a company secretary in practice or chartered accountant in practice.
(8A) The company shall immediately bring to the notice of the depositories any difference observed in its issued capital and the capital held in dematerialised form. |
Rule 8 has been substituted with a revised Rule 8 and Rule 8A. Prior to the introduction of this amendment, the audit report was required to be filed as per Regulation 55A of the 1996 Regulation. Now, the provision to file this report has been directly introduced in the Rules on prospectus.
Effective 30th September, 2019, the Reconciliation of Share Capital Audit Report) will be required to be filed in Form PAS-6 by unlisted public companies. The submission in Form PAS-6 must be made to the Registrar on a half yearly basis within 60 days of conclusion of each half year and must be certified by the company secretary in practice or chartered accountant in practice.
Further, any difference between issued capital and the capital held in dematerialised form must be immediately brought to the notice of the depositories.
|
Under Form PAS-6, all information furnished must be for the half year ended 30th September and 31st March of every financial year and separate submissions must be made for each International Securities Identification Number (“ISIN”).
Source: Ministry of Corporate Affairs
