Companies Bill: Stalled in Parliament?

Newspaper reports (here, here and here) suggest that the Companies Bill has run into some rough weather, with indications that it might be referred to the Standing Committee for further review. This is surprising as well as disconcerting, as it comes within a week of the Government presenting the Bill in Parliament.

It represents further delay in the corporate law reform process, which has been taking place in fits and starts for a decade now, with a logical conclusion still being elusive. Granted that there are areas in the Bill that may require fine-tuning, but the approach of holding back the reform process itself is not desirable. Based on the experience with the Standing Committee’s review of the Companies Bill, 2009, it is possible that there could be a significant reconsideration on fundamental issues in case it goes up for review, which could delay the process much further.

In the meanwhile, a corrigendum to the Companies Bill, 2011 has been issued that apparently contains some changes of a substantive nature as well.

In any event, we hope to continue our periodic analysis of the Bill with a touch of optimism.