November 19, 2019
Summary of Notifications in the Companies Act, 2013 and the IB Code, 2016 issued on 18/11/2019 is listed below:
1. The Companies (Meetings of Board and its Powers) Second Amendment Rules, 2019:
Rule 15 is amended to relax the monetory restrictions to enter into contracts or arrangements with Related Parties subject to passing a member’s resolution. Accordingly, member resolution is not required for transactions like sale, purchase or supply of any goods or materials, leasing of property and availing or rendering of any services, if transaction value does not exceed 10% of the company’s turnover and for selling or disposing of or buying property if transaction value does not exceed 10% of the company’s net worth. The upper limits of 100 Crores and 50 Crores respectively on these Related Party Transactions is omitted.
2. Threshold limits and Appropriate Regulator notified for resolution of Financial Service Providers under IBC, 2016:
Central Government has notified that Non-banking finance companies (which include housing finance companies) with asset size of Rs.500 crore or more, as per last audited balance sheet, shall fall under the definition of Financial Service Provider specified in Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019. Further, RBI shall be the appropriate regulator under the said Rules.