Latest Updates
LEGAL UPDATES
February 16, 2023
Foreign contributions should be received only through the FCRA Account of the State Bank of India, New Delhi Branch Main Branch. These contributions are received directly from foreign banks through SWIFT and from Indian intermediary banks through NEFT and RTGS Systems. As per necessary requirements, the donor details such as name, address, country of origin amount, currency, and purpose of remittance are required to be captured in such transactions and SBI is required to report the same to the Ministry of Home Affairs on a daily basis.
Keeping in view of the above, necessary changes have been introduced to NEFT and RTGS systems and member banks are advised to incorporate necessary changes in their core banking/middleware solutions to capture the requisite details while forwarding the foreign donations through NEFT and RTGS systems to SBI.
February 15, 2023
To protect the interests of investors and promote the development of the securities market, SEBI has released a circular directing stock brokers/depository participants to maintain their respective websites and has provided directions on mandatory publication of information as given under the circular. This is done to bring in transparency and help the investors to make them well informed about the activities of the stock brokers/depository participants.
From 13th February to 15th February, 2023, the First Meeting of the G20 Digital Economy Working Group was held in Lucknow. Participation was seen by the G20 member nations and 8 guest countries. Knowledge Partners included international organizations, namely ITU, UNDP, OECD, UNESCO and World Bank. Extensive discussions were held on areas regarding Digital Public Infrastructure (DPI), Cyber Security in Digital Economy and Digital Skilling.
SEBI has decided to introduce Issue Summary Document (ISD) to facilitate consumption of data by various stakeholders in respect of public issues, further issues, buyback, offers under SEBI(SAST) Regulations, 2011 & SEBI (Delisting of Equity Shares) Regulations, 2021. ISD will make available relevant information/data points at the Stock Exchanges and Depositories in a structured manner.
Entities responsible will fill in ISDs in the prescribed manner, for submission to the Stock Exchanges and the Stock Exchanges will develop a utility to facilitate the filing by the submitting entities. Stock Exchanges will further transmit the information to other Stock Exchanges and Depositories for dissemination.
February 14, 2023
Amendment of the SEBI (Infrastructure Investment Trust) Regulations, 2014
SEBI has amended the Security and Exchange Board of India (Infrastructure Investment Trusts) Act, 2014 with the Security and Exchange Board of India (Infrastructure Investment Trusts) (Amendment) Regulations, 2023 issued via the following:
February 13, 2023
New Directors have been advised by the MCA to register as Business Users and Associate DSC in Version 3 before filling out forms in Version 3. Stakeholders have been advised by the MCA to check their already filed/initiated Spice+ applications of Version 2 in the Historic tab of V3 Application History.
GOI has launched the following digital initiatives for the promotion of digital empowerment and ease of doing business:
- Udyam Registration portal for online registration;
- Champions Portal for grievance redressal of MSMEs;
- Government e-Marketplace (GeM) for online procurement;
- Trade Receivables Discounting System (TReDS) for discounting invoices and msmemart.com for facilitating online marketing support;
- MSME SAMBANDH for monitoring of procurement by Central Public Sector Enterprises (CPSEs) from Micro and Small Enterprises (MSEs); and
- MSME SAMADHAAN portal for filling applications regarding delayed payments by Central Ministries / Departments / CPSEs / State Governments, etc.
The Maternity Benefit Act, 1961(Act), as amended in 2017, is being implemented in regard to the provisions for paid maternity leave to women workers and crèche facility by establishments by the Ministry of Labour and Employment.
Section 5 has increased the paid maternity leave from 12 weeks to 26 weeks of which not more than 8 weeks should precede the date of expected delivery. Provisions are also given for work from home and on such conditions as the employer and the employee may mutually agree depending on the nature of work given.
As of 31st January, 2023, the Emergency Credit Line Guarantee Scheme (ECLGS) has provided guarantees amounting to Rs. 3.61 lakh crores to 1.19 crore borrowers. Around 14.6 lakh MSME accounts, of which about 98.3% were micro and small enterprises, were saved because of ECLGS.
ECLGS was launched in 2020 to support eligible MSMEs and business enterprises to meet their operational liabilities and restart their businesses because of the damage done by the pandemic in 2020.
Khadi and Village Industries Commission (KVIC) is implementing the Prime Minister’s Employment Generation Programme (PMEGP) to help entrepreneurs in setting up new units in the non-farm sector. The maximum cost of a project is Rs. 50 lakhs in the manufacturing sector and Rs. 20 lakhs in the service sector. Also, Margin Money subsidy is being provided in terms of urban and rural areas, to general category, scheduled caste, OBC, etc.
Different schemes and programmes focused on providing investment for the adoption of the latest technologies in the MSME sector have been introduced, which includes:
- MSME Champions Scheme;
- Credit Guarantee Fund Trust for Micro and Small Enterprises;
- Prime Minister’s Employment Generation Programme; and
- Micro and Small Enterprises – Cluster Development Programme.
Technology Centres have been established for industries through design & manufacture of tools, precision components, moulds, dies, jigs etc. in sectors such as general engineering, forging & foundry, electronic system design and manufacturing, electrical, fragrance & flavors, glass, footwear & sports goods.
To increase the contribution of MSMEs in Indian exports, the Ministry of MSE is also implementing the International Cooperation Scheme which facilitates the participation of MSMEs in various international programs.
A study submitted by the M/s Entrepreneurship Development Institute of India, states that the Public Procurement Policy for Micro and Small Enterprises Order, 2012 had a positive impact on aspects like turnover, individual reputation, employment growth and production capacity expansion.
February 9, 2023
Digital Payment Utsav, a campaign focused in promoting digital payments in India, to be held from 9th February to 9th October 2023. The campaign is aimed in promoting digital payments in India especially in cities of Lucknow, Pune, Hyderabad and Bengaluru, as part of the G20 Digital Economy Working Group.
February 8, 2023
Ministry of Finance has circulated a scheme aimed at bringing quick finality to certain disputes in which GOI or its agencies is a litigant. These disputes are said to be blocking fresh investment and reducing the ease of doing business with the Government. Therefore, the Government intends to bring one time settlement scheme called “Vivad se Vishwas II (Contractual Disputes)” to effectively settle such pending disputes.
SEBI has issued this circular to clarify that the securities which shall have the following characteristics will require mandatory compliance with the applicable SEBI provisions for issuance and listing of the NCS Regulations and circulars thereunder:
- Issuer is allowed by RBI to issue such instruments;
- Instruments form part of the non-equity regulatory capital;
- Instruments are perpetual debt instruments, perpetual non-cumulative preference shares or instruments of similar nature; and
- Instruments contain a discretion with the issuer/RBI for events including but not restricted to all or any of the following:
- Conversion into equity;
- Write-off of interest/principal;
- Skipping/delay payment of interest/principal;
- Making an early recall;
- Changing any terms of issue of the instrument.
- Recovery of Penal Charges on Loans
To avoid Regulated Entities from charging exorbitant penalty charges on loans, the following have been prescribed:
(i) Any penalty for default in servicing of any loan or any other non-compliance of material terms and conditions of loan contract by the borrower shall be in the form of ‘penal charges’ in a reasonable and transparent manner and shall not be levied in the form of ‘penal interest’ that is added to the rate of interest being charged on the advances;
(ii) Penal charges shall not be recovered separately and not to be added to the principal outstanding; and
(iii) In case of any deterioration in credit risk profile of the borrower, Regulated Entities shall be free to alter the credit risk premium under extant guidelines on interest rate.
In furtherance of the above-mentioned measures, RBI will place guidelines on its website inviting comments from the stakeholders.
- Regulatory Initiatives on Climate Risk and Sustainable Finance
To reduce the mitigating effects of climate change on Regulating Entities, a Discussion Paper on Climate Risk and Sustainable Finance was previously issued by RBI and feedback had been received for the same from the public stakeholders and based on analysis, the following guidelines have to be issued for Regulating Entities:
(a) Broad Framework for acceptance of Green Deposits;
(b) Disclosure framework on Climate-related Financial Risks; and
(c) Guidance on Climate Scenario Analysis and Stress Testing
The guidelines will be issued in a phased manner and RBI shall have a dedicate webpage on its website which shall have all the RBI related information on climate risk and sustainable finance.
- Increasing the scope of Trade Receivables Discounting System (TReDS)
In furtherance of expanding the activity of TReDS platforms, the following measures have been prescribed:
(a) Availability of insurance facility on TReDS platforms to encourage financing/discounting of payables of buyers irrespective of their credit ratings. Accordingly, insurance companies will be allowed to participate as a “fourth participant” on TReDS, apart from MSME sellers, buyers and financers;
(b) Entities/institutions eligible to undertake factoring business under the Factoring Regulation Act will be allowed to participate as financiers in TReDS; and
(c) Secondary market operations will now be enabled on TReDS platforms to allow financiers offload their existing portfolio to other financiers within the same TReDS platform, if required.
- Extending UPI for inbound Travellers to India
The services of Unified Payments Interface will now be available to foreign nationals and NRIs visiting India. As of now, this facility will be provided to travellers from the G-20 countries at selected international airports for merchant payments (P2M) while they are in country. Further, these services will be extended across all entry points in India. In furtherance of this development, the Master Directions on Prepaid Payment Instructions (PPIs) has been updated by inserting the paragraph 10.3.
February 7, 2023
Additional time of 15 days has been provided for filing of 45 forms and Form PAS-03 (due dates falling between 20th March and 6th March 2023) in Version-3.
February 6, 2023
Ministry of Finance provided a major relief to MSMEs, where by an order has asked Ministries to refund performance security/bid security and liquidated damages forfeited/deducted during the COVID-19 pandemic.
Interest-Free Credit Support to Micro-Units
Indian Banks’ Association (IBA) has been advised by the Department of Financial Services to devise a credit card, in consultation with Reserve Bank of India and other stakeholders, similar to Kisan Credit Card that provides a card to operate the Cash Credit limit sanctioned to MSMEs for their working capital requirement. As per 46th report of Parliamentary Standing Committee on Finance, SIDBI in association with GOI is developing a Vyapaar Credit Card aimed at providing access to formal bank credit for MSMEs.
February 1, 2023
AIFs shall undertake at least 10% of their total secondary market trades in Corporate Bonds by value in a month by placing/seeking quotes on the ‘Request for Quote’(RFQ) platform. All transactions in Corporate Bonds wherein AIF(s) is on both sides of the trade shall be executed through RFQ platform in ‘one to one’ mode. However, any transaction entered by an AIF in Corporate Bonds in ‘one-to-many’ mode which gets executed with another AIF, shall be counted in ‘one-to-many’ mode and not on ‘one-to-one’ mode.
Pursuant to this circular, the following changes have been made: (a) Requirement of the End of Day margin collection from clients in derivatives segments (including commodity derivatives) shall be calculated based on the fixed Beginning of Day margin parameters; and (b) This change has been made only for the purpose of verification of upfront collection of margins from clients.
January 31, 2023
Amendments have been made in Rule 3(a) for sub-rule (2) which has made the e-filling of pleadings by applicants mandatory and no other form of filling shall not be taken on record.