India’s Joint Parliamentary Committee has endorsed key reforms to the Corporate Laws (Amendment) Bill 2026, aiming to decriminalise defaults, improve governance, and support technology firms and startups in a move to accelerate economic digitalisation.
India’s Joint Parliamentary Committee has backed a broad package of changes to the Corporate Laws (Amendment) Bill, 2026, a measure first introduced in the Lok Sabha on March 23 and later sent for detailed scrutiny. In a report issued on August 3, the panel endorsed reforms designed to cut procedural friction, strengthen governance and speed up company law processes, with several proposals likely to matter most to technology firms, startups, global capability centres and the wider digital economy, according to Nasscom’s summary of the committee’s work and related legal analyses.
At the centre of the package is a push to decriminalise a range of technical and procedural defaults under the Companies Act and the LLP law, replacing criminal punishment with civil penalties in cases that do not involve serious wrongdoing. The committee also recommended lowering the pre-deposit needed to appeal penalties from 10% to 5%, a move that could ease the cash burden on smaller firms contesting regulatory action. Industry commentary from EY and others says the Bill continues a broader shift towards proportionate enforcement, following earlier reforms such as the Jan Vishwas Act.
The committee also pressed for clearer rules on hybrid and virtual shareholder meetings, remote e-voting and related technology safeguards, saying the details should be set in consultation with market regulators. Nasscom said that a formal framework would improve flexibility for listed companies and large technology businesses while reducing compliance costs. The panel separately flagged delays at the National Company Law Tribunal and recommended additional benches and more judicial and technical members to speed up mergers, demergers, restructuring and insolvency cases.
Another major strand of reform concerns valuation and reporting. The committee supported giving the Insolvency and Bankruptcy Board of India a larger role as valuation authority for registered valuers, alongside draft regulations, public consultation and periodic review. It also endorsed wider powers for the National Financial Reporting Authority, while urging safeguards against excessive discretion. Legal analyses of the Bill say it could also sharpen the framework for International Financial Services Centre structures and conversion of trusts into LLPs.
For dealmaking, the committee backed a lower approval threshold for fast-track mergers, from 90% to three-fourths in value of members present and voting, but paired that with a proposed fair-value exit or buy-out route for dissenting shareholders. It also suggested faster decision-making on merger applications, including a 60-day disposal timeline and deemed approval if authorities miss the deadline. On corporate social responsibility, the panel supported higher thresholds, more time to transfer unspent funds and possible scope for in-kind contributions, subject to valuation and disclosure controls.
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