BSE Start-up Platform

BSE circular dated 21st June, 2018 on the above subject.

Trading Members and participants are hereby informed that BSE SME segment has emerged as preferred platform for SME in India with highest number of listed companies.

In order to provide further incentive to the companies which are “Startups” in the sector of IT, ITES, Bio-technology and Life Science etc., the Exchange is pleased to announce that “BSE Startup Platform” is enabled on BSE SME Segment.  

This platform will facilitate the listing of companies in the sector of IT, ITES, Bio-technology and Life Science, 3D Printing, Space technology, E-Commerce, Hi- Tech Defense, Drones, Nano Technologies, Artificial Intelligence, Big data, Enhance/Virtual Reality, E-gaming, Exoskeleton, Robotics, Holographic Technology, Genetic Engineering, Variable Computers Inside body computer technology and any other Hi-tech based company.

The criteria for listing on “BSE Startup Platform” is as follows:

1.       The pre issue paid up Equity share Capital of the company should be minimum of Rs. 1 crore.

2.       The company should be in existence for a minimum period of 3 years on the date of filing the draft prospectus with BSE

3.       There should preferably have investment by QIB investors (as defined under SEBI ICDR Regulations, 2009) / Angel Investors for a minimum period of 2 years at the time of filing of draft prospectus with BSE and such aggregate investment should be at least Rs. 1 crore

4.       The company should have positive net-worth

5.       The Company should not have been referred to National Company Law Tribunal (NCLT) under Insolvency and Bankruptcy Code, 2016

6.       There should be no winding up petition against the company that has been accepted by the National Company Law Tribunal (NCLT)

The companies listing on BSE Startup Platform with the above mentioned criteria will follow all the other conditions applicable for listing of SME Companies under Chapter XB of “SEBI (ICDR) Regulations, 2009”, relating to disclosures, migration to main Board, etc.

10K race in Vile-parle

Ran a 10K race after years yesterday at the Keep on Running India 10K which was held at Vile-Parle East, suburb of Mumbai. It was a flat track with two loops of 5K, the weather was okay and drizzling to slightly light showers. There were too many twists and turns for a 10K, but the roads were okay and crowds were non existent for a sunday morning. There were sufficient volunteers at every corner so a possibility that a runner might get lost was not there. Since I was racing after a long time, and not much of strength training in the interregnum, was pleasantly surprised that I was able to maintain the pace for a long time. The whole ideas was to treat it as a long tempo run, so that was good in the end. 

Companies Amendment Act 2018 -

MCA has vide its notification dated 13th June, 2018 allowed commencement of amendment to five sections of the Companies Act, 2013, vide Companies (Amendment) Act, 2018. These amendments come into effect from 13th June, 2018. These are:

section 90: this section has been substituted by a new section in toto. This deals with significant beneficial ownership for which separate rules have been notified also. This section is basically to find out who is the actual owner of shares on which beneficial interest lies not with the person whose name is entered in the register of members but with somebody else. This is important from the point of view of compliance thereto in respect of individuals or one or two individuals who are having beneficial interest in shares of the company.

section 93: Deletion of this section. This section required promoters to give details of shares held by them and top ten promoters and any change made therein to the extent of two percent or more shareholding to be reported to the Ministry in the prescribed format. This was a cumbersome section and rightly done away with.

section 94: this section deals with place of keeping and inspection of registers & records etc. There was a proviso which said that the annual returns may also be kept at a place other than the registered office in India in a city where more than 1/10th of the total number of members reside, if approved by a special resolution passed at a general meeting. There was a requirement that the ROC be given an advance copy of the proposed special resolution. This requirement of providing advance copy of the special resolution to the ROC has been done away with. 

Sub-Section (3) of section 94 provided that any member, debenture holder, other security holder or beneficial owner or any other person may (a) take extracts from any register or index or return without payment of fee, or (b) require a copy of such register or entries thereon or return on payment of such fees as may be prescribed.

Now a proviso has been added to this sub-section which says that - such particulars of the register or index or return as may be prescribed shall not be available for inspection under sub-section (2) or taking extracts or copies under this sub-section. 

Section 96- This section pertains to annual general meeting. Now a provision has been added in sub-section (2) that the annual general meeting of an unlisted company may be held at any place in India, provided consent is given in writing or by electronic mail by all the members in advance. 

So, this is is a liberalised move to allow private companies and unlisted public companies to hold annual general meeting at any place in India, provided consent is taken thereof in advance.

Section 216: This section pertains to investigation of ownership of the company. Pursuant to the enactment of the new section 90 regarding significant beneficial ownership, a clause has been added empowering central government to appoint one or more inspectors to investigate and report on matters relating to the company or persons "who have or had beneficial interest in shares of a company or who are or have been beneficial owners or significant beneficial owner of a company"

ECB reporting - ECB2

RBI has vide its circular dated 7th June, 2018 modified the monthly ECB-2 in respect of external commercial borrowings by capturing hedging of ECBs in the ECB2 return. Details of hedging in part E.1 of the return and foreign exchange earnings & expenditure in part E.2 of the return to be furnished in addition to the existing details in ECB-2

Gist of RBI circular given below:

Attention of Authorized Dealer Category I (AD Category I) banks is invited to Annex III of Part V of Master Direction No.18/2015-16 dated January 01, 2016 on Reporting under Foreign Exchange Management Act, 1999, as amended from time to time. The said Master Direction, inter alia, stipulates the reporting arrangement for ECBs through ECB-2 Return.

2. It has been decided to capture the details of the hedges for ECBs through a simplified format of ECB 2 Return. Part E of the Return, accordingly, is modified so as to include only standard information on hedged/unhedged ECB exposure (Annex). Details of hedging in Part E.1 of the Return and foreign exchange earnings and expenditure in Part E.2 of the Return should be furnished in additive format. Further, for reporting in respect of natural hedge, provisions contained in paragraph 2 (iii) of A.P. (DIR Series) Circular No. 15 dated November 07, 2016 should be followed.

3. Revised monthly reporting format of ECB 2 Return would be applicable from month-end June 2018. It is reiterated that any lapse at the time of reporting through this return and / or failure to adhere to the time line of its submission and / or any lapse at the time of reporting through Form 83 is a contravention of the provision of Foreign Exchange Management Act, 1999 (42 of 1999).

4. AD Category - I banks may bring the contents of this circular to the notice of their constituents and customers. The aforesaid Master Direction No. 18 dated January 01, 2016 is being updated to reflect the changes.

5. The directions contained in this circular have been issued under sections 10(4) and 11(2) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.

https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=11296&Mode=0

Foreign Investment in India - Reporting

RBI circular dated 7th June, 2018 on the above subject - important for compliance by companies accepting foreign investment in India.

As announced in the First Bi-monthly Monetary Policy Review dated April 5, 2018, Reserve Bank, with the objective of integrating the extant reporting structures of various types of foreign investment in India, will introduce a Single Master Form (SMF). The SMF would be filed online.

2. SMF would provide a facility for reporting total foreign investment in an Indian entity {as defined in Foreign Exchange Management (Transfer or issue of security by a person resident outside India) Regulations 2017, dated November 7, 2017}, as also investment by persons resident outside India in an Investment Vehicle.

3. Prior to the implementation of the SMF, Reserve Bank would provide an interface to the Indian entities, to input the data on total foreign investment in a specified format. The interface will be available on RBI website www.rbi.org.in from June 28, 2018 to July 12, 2018. Indian entities not complying with this pre-requisite will not be able to receive foreign investment (including indirect foreign investment) and will be non-compliant with Foreign Exchange Management Act, 1999 and regulations made thereunder.

4. The entities may be in readiness with the requirements to be provided in the Entity Master at Annex 1. The format of the SMF is at Annex 2. The final form, when hosted, will be available in the Master Direction-Reporting under FEMA, 1999.

5. AD Category-I banks may bring the contents of this circular to the notice of their customers / constituents concerned.

6. The directions contained in this circular have been issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act (FEMA), 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.

RBI circular is available at
https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=11297&Mode=0

Liberalised Remittance Scheme

RBI has vide its circular dated 19th June, 2018 mandated that furnishing of PAN is necessary document while allowing all remittances outside India under the Liberalised Remittance Scheme (LRS). Hitherto, for remittances under US$25,000/- PAN was not mandatory, Now it has become mandatory for any amount being remitted under the Scheme.

Gist of RBI circular is given below:

Please refer to paragraph 18 of the Statement on Developmental and Regulatory Policies of the Second Bi-monthly Monetary Policy Statement for 2018-19released on June 6, 2018. As indicated therein, it has been decided that furnishing of Permanent Account Number (PAN), which hitherto was not to be insisted upon while putting through permissible current account transactions of up to USD 25,000, shall now be mandatory for making all remittances under Liberalised Remittance Scheme (LRS).

2. Further, in the context of remittances allowed under LRS for maintenance of close relatives, it has been decided, in consultation with Government, to align the definition of ‘relative’ with the definition given in Companies Act, 2013 instead of Companies Act, 1956.

3. Master Direction No. 7/2015-16 dated January 01, 2016 on LRS is being updated simultaneously to reflect the above changes.

4. The directions contained in this circular have been issued under Sections 10(4), 11(1) and 11(2) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions/approvals, if any, required under any other law.

https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=11309&Mode=0

Bank customer service to pensioners

RBI circular dated 21st June, 2018 on this subject.

Please refer to our circular no.DGBA.GAD.H-3085/45.01.001/2008-09 dated October 1, 2008 on the captioned subject.

2. We are receiving complaints from various quarters that pensioners are not being treated with due consideration by bank officials, specifically the old pensioners, when they come to the branches for pension related transactions.

3. Thus, all agency banks disbursing pension are advised to provide considerate and sympathetic customer service to the pensioners, specially to those pensioners who are of old age.

https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=11310&Mode=0