➢ Provision of self-regulation with disclosures/transparency instead of ‘Government
approval based regime’.
➢ Automation of corporate records/meetings - statutory recognition to (i) maintenance of
documents by companies in electronic form, (ii) ‘video-conferencing’ as a mode of
conducting board meetings, etc.
➢ Faster mergers and acquisitions including short form of mergers and cross border
➢ Summary liquidation: For companies having net assets of ₹ 1 crore or less, Official
Liquidators (OLs) are empowered with adjudicatory powers.
➢ National Company Law Tribunal (NCLT) has been constituted under Section 408 in
➢ Concept of ‘dormant companies’ introduced (companies not engaged in business for two
consecutive years can be declared as dormant).
➢ Concept of One Person Company (OPC) introduced.
II. Good Corporate Governance and Corporate Social Responsibility (CSR)
➢ Concept of Independent Directors (IDs) included as a statutory requirement u/s 149 (4).
➢ Provision for constitution of several committees of the Board (Audit Committee,
Nomination and Remuneration Committee, Stakeholders Relationship Committee and
➢ Woman Director for prescribed class of companies.
➢ Mandatory provision for constitution of CSR Committee and formulation of CSR Policy,
with mandatory disclosure, for prescribed class of companies.
III. Enhancing Accountability of Management
➢ The term ‘Officer in Default’ has been reviewed to make it more relevant.
➢ Terms ‘Key Managerial Personnel’ (KMP) and ‘Promoter’ defined to affix responsibility
on key functionaries of the company.
➢ Duties of Directors defined, including to shareholders, employees, the community and
➢ Cap on number of Directorships: 20 companies, of which 10 can be public companies.
IV. Strengthened Enforcement
➢ The Central Government to have powers to order investigation, suo-motu, in public
➢ Statutory recognition of Serious Fraud Investigation Office (SFIO).
➢ Special Courts have been constituted under Section 435 in 2016.
➢ Search and seizure of documents, during investigation, without an order from a
➢ Freezing of assets or disgorgement of illegal gains of company under investigation.
V. Audit Accountability
➢ Recognition of accounting and auditing standards.
➢ Stricter disqualification norms for auditors.