CII welcomes Cabinet’s decision to clear the Companies Bill, 2011 for its introduction in the Parliament.

Mr Chandrajit Banerjee director general of CII in a statement said that “The Bill has been through various iterations and the industry anxiously awaits a new corporate law that would lay stress on responsible self-regulation. Needless to say, the new company law is expected to be more streamlined and facilitative than the existing 55 year-old Companies Act, it seeks to replace.”

CII appreciated the dialogue oriented consultative approach adopted by the Ministry of Corporate Affairs during the process of revising and modernizing corporate regulation commensurate with global standards. On enactment, the Companies Bill will be a boon for business, corporates, investors and stakeholders at large. Incorporation of new entity in the form of one person company and simpler compliance regime for small companies will encourage corporatization of business and entrepreneurship. Promising a contemporary framework, the new Companies Bill is also expected to provide a single forum for approval of mergers and acquisitions while according recognition to cross border mergers.

The new law would strengthen the concept of shareholders democracy and offer protection of the rights of minority stakeholders. The law proposes to introduce responsible self regulation replete with disclosures and accountability and make possible substitution of government control with shareholder control over internal corporate processes and decisions. These proposals would enable unfettered functioning of corporates and are welcome.

Mr Chandrajit Banerjee further said that “Being a very technical Bill, CII will wait to see the detailed language of the document to assess the impact on industry, but CII is very hopeful that the Cabinet has kept the concerns of industry in mind while clearing this important legislation.”