The weekly messenger | Edition 07.20

Regulatory News

Extension of time for generating eCSIN – 29 February 2020

As per the ICSI (Employee Company Secretaries Identification Number) Guidelines, 2019, the quoting of eCSIN was made mandatory for members entering into any employment as Company Secretary or otherwise and cessation thereof w.e.f. 1 October 2019. Also, the members in respect of whose appointment, form 32 under the provisions of erstwhile Companies Act, 1956 or e-form DIR-12 under the provisions of the Companies Act, 2013 had already been filed or the members who were otherwise employed upto and including 30 September 2019 were mandatorily required to generate eCSIN on or before 31 December 2019.
 
The ICSI, after receiving various requests from its members w.r.t. the extension of the last date generation of eCSIN, has decided to extend the same several times i.e. from 31 December 2019 to 15 January 2020 to 29 February 2020 and now finally to 31 March 2020.
 
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Companies (Appointment and Qualification of Directors) Amendment Rules, 2020 – 28 February 2020

The Central Government has amended the Companies (Appointment and Qualification of Directors) Rules 2014 with the Companies (Appointment and Qualification of Directors) Amendment Rules, 2020, wherein the following changes have been made in Rule 6 ‘Compliances required by a person eligible and willing to be appointed as an independent director’ of the aforesaid Rules:
 

• Time limit for the purpose of applying online by the individuals, who have been appointed as an Independent Director, on the date of commencement of the Companies (Appointment and Qualification of Directors) Fifth Amendment Rules 2019, to the Institute for inclusion of his name in the online data bank has been extended from three months to five months from the commencement of the fifth Amendment Rules i.e. 1 December 2019;
• In sub-rule 4, which deals with online proficiency self-assessment test to be given by independent director, whose name has been included in online data bank:

1. In the first proviso which exempts the individuals from passing the online proficiency self-assessment test on certain grounds, one more condition has been added which states that if an individual who has served as a director or key managerial personnel, for a total period of not less than ten years, as on the date of inclusion of his name in the databank in a body corporate listed on a recognized stock exchange will not be required to pass the aforesaid test.
2. in the second proviso, for the word “companies”, the words "companies or bodies corporate" have been substituted.

These rules shall come into force from the date of publication in the official gazette i.e. 2 March 2020.
 
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Extension of last date for submission of public comments on the “consultation paper on enhancement of Audit Independence and Accountability” up to 15th March 2020 – 2 March 2020

The Ministry of Corporate Affairs, pursuant to various requests received from various quarters and stakeholders, has decided to extend the last date for submission of public comments on the ‘consultation paper on enhancement of Audit Independence and Accountability’ from 28 February 2020 to 15 March 2020.
 
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FAQs on CRR exemption – 25 February 2020

The Reserve Bank of India (RBI), pursuant to the clarifications sought by some of the banks w.r.t. consideration of certain items in the calculation of Cash Reserve Ratio (CRR), has issued the following frequently asked questions (FAQS):

• How to compute equivalent amount of incremental credit that can be deducted/exempted from the NDTL for the purpose of CRR?
• Whether factoring units of MSMEs discounted under the ‘Trade Receivables Discounting System’ (TReDs) are eligible for exemption/deduction?
• For how long such deductions/ exemptions are allowed?
• Any specific format to be kept for Audit Purpose by RBI.

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External Benchmark Based Lending – Medium Enterprises – 26 February 2020

Earlier, the RBI had directed all the Scheduled Commercial Banks (SCBs) (excluding Regional Rural Banks (RRBs)), Small Finance Banks and Local Area Banks to link all new floating rate personal or retail loans (housing, auto, etc.) and floating rate loans to Micro and Small Enterprises (MSEs) w.e.f. 1 Oct. 2019 with one of the following external benchmarks:

• RBI policy repo rate;
• Government of India 3-Months Treasury Bill yield published by the Financial Benchmarks India Private Ltd (FBIL);
• Government of India 6-Months Treasury Bill yield published by the FBIL;
• Any other benchmark market interest rate published by the FBIL.

Now the same provisions have also been extended to the loans lent to the medium enterprises w.e.f. 1 April 2020.
 
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