CA Institute, which is world’s largest accounting body, has invited suggestions from its members on the changes necessary in existing Company Law related rules so as to enhance Ease of Doing Business and have a robust corporate governance framework. 

Members have been asked to send in their suggestions/comments by February 10, sources said. Currently, the Institute of Chartered Accountants of India (ICAI) has about four lakh members and over eight lakh students.

This latest ICAI move comes in the wake of Corporate Affairs Ministry (MCA) initiating a comprehensive review of Company Law Rules and LLP Rules through its e-consultation module at MCA website. 

For this purpose, MCA had decided to invite comments/suggestions on the rules issued under such legislations from all the stakeholders through an e-consultation platform on the MCA website. 

In a bid to avoid duplication or repetition of comments/suggestions, MCA had earlier advised that the members of the professional institutes should route their comments/suggestions through the respective institute.

Earlier this month, MCA had released a policy for Pre-Legislative Consultation and comprehensive review of existing rules and regulations prescribed under various legislations administered by it. 

It had also decided to initiate a comprehensive review of all the rules prescribed under various legislations being administered to it.

Currently, MCA is the nodal Ministry for administration of seven legislations that require framing of the rules by the Ministry. These seven legislations are Companies Act,2013, The Limited Liability Partnership Act 2008, The Competition Act 2002, The Insolvency and Bankruptcy Code, The Chartered Accountants Act 1949, The Cost and Works Accountants Act and The Company Secretaries Act.  

New Policy

MCA has framed a new Comprehensive Policy — which has come into effect from January 1 this year—that aims towards carrying out public consultations both at the time of framing original rules and regulations and at the time of review as outlined in Para 100 of Budget Speech (2023-24). Separate policy has been prescribed for framing of rules by the Ministry and framing of regulations by regulators. 

Finance and Corporate Affairs Minister Nirmala Sitharaman said in her budget speech, “To simplify, ease and reduce cost of compliance, financial sector regulators will be requested to carry out a comprehensive review of existing regulations. For this, they will consider suggestions from public and regulated entities. Time limits to decide the applications under various regulations will also be laid down”.

MCA had also made it clear that the concerned divisions of the Ministry and the regulators constituted under various statutes being administered by the Ministry would comply with the policy as far as practicable and within the respective statutes.  

Also, where there is a specific statutory provision on the subject of or manner of consultation, it would have to be followed, MCA added.