Corporate Laws (Amendment) Bill, 2026
The Union government introduced the Corporate Laws (Amendment) Bill, 2026, in the Lok Sabha to ensure the laws remain relevant in the evolving business environment. Although the Bill is under examination by a joint parliamentary committee, it includes several notable amendments.
Key Amendments
- Special Benches of NCLT:
- The Bill allows the President to create special Benches of the National Company Law Tribunal (NCLT) for resolving cases under the Companies Act or Insolvency and Bankruptcy Code, 2016.
- This aims to address capacity constraints and reduce delays in insolvency resolutions, which currently take over twice the intended time.
- Centralisation of Merger Applications:
- Proposes processing merger applications at a single NCLT Bench to ease pressure and speed up the merger process.
- Corporate Social Responsibility (CSR):
- Increases the mandatory net-profit threshold for CSR from ₹5 crore to ₹10 crore, providing relief for smaller companies.
- Auditing and Accountability:
- Restricts audit firms from providing non-audit services to certain companies for three years post-audit to improve audit quality.
- Buyback Flexibility:
- Eases terms for certain companies, allowing them to make two buyback offers a year, adjusting to market conditions.
- National Financial Reporting Authority (NFRA):
- Provisions to bring NFRA on par with other regulators to enhance accounting standards and address significant gaps in financial reporting.
- Facilitating Compliance:
- Proposes enabling the conversion of alternative investment funds from trusts to limited-liability partnerships.
- Allows companies to hold AGMs and EGMs via videoconferencing or other audiovisual methods.
Potential Impact
If passed alongside the Insolvency and Bankruptcy Code (Amendment) Bill, 2025, these amendments can significantly boost the insolvency-resolution framework, improve the business environment, and attract large investments by enhancing compliance and financial reporting standards.
