Blog Posts
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FDI from Cayman Islands: Recent Changes
[Posted by Umakanth Varottil] In an article titled “Investing in India: How Recent Developments in the Cayman Islands Facilitate Inbound Investment”, Chetan Nagendra examines two recent events: Cayman Islands’ acceptance as a full member of IOSCO and its recognition in the ‘white list’ of jurisdictions that have substantially implemented the OECD tax standard. He notes…
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True and Fair Accounting
[Posted by Shantanu Naravane] Recent events like Satyam and the economic recession have thrown up several issues about appropriate accounting and auditing practices, discussed here and here. In this context, it is interesting to note a decision of the United Kingdom Queen’s Bench in Macquarie Internationale Investments Ltd. v. Glencore UK Ltd., [2009] EWHC 2267…
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SEBI decides to amend Listing Agreement, Takeover Regulations, etc.
[Posted by Jayant Thakur] SEBI has issued a press release stating the decisions taken at the Board meeting held today and certain aspects have been highlighted. The decisions relate to amendments of the Listing Agreement and the new ICDR 2009, the Takeover Regulations and certain other amendments. The press release is fairly self explanatory and…
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Contestability of Corporate Control
[Posted by Umakanth Varottil] In a column in the Business Standard, Nitin Desai argues that the current ecosystem in India provides greater benefits to corporate control, resulting in a number of large Indian companies being managed by the promoter-owners. Corporate control may be susceptible to challenge if there is a market for control facilitated by…
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Inputs and Suggestions to TRAC
[Posted by Umakanth Varottil] The Takeover Regulations Advisory Committee (discussed earlier) has invited inputs and suggestions regarding suitable amendments to the SEBI Takeover Regulations. This is part of the committee’s consultative process. Suggestions are due in the prescribed format by October 31, 2009. The background for the proposed amendments is as follows: There have ……
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The Legal Aspects of Dual Listings
[Posted by Umakanth Varottil] There has recently been a fair amount of discussion regarding the ability of companies to carry out dual listings in India. This arises in the context of dual listing as a possible structure being considered in the Bharti-MTN transaction. Generally, dual listings occur when two or more companies (that otherwise intend…
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SEBI’s Proposed Changes on Disclosures and Audit Norms
[Posted by Umakanth Varottil] After the Satyam fraud earlier this year, there was expectation of significant regulatory changes that strengthen corporate governance, disclosure and audit norms in India companies. Some changes did occur almost immediately; for instance, detailed measures were introduced favouring disclosure of pledges by promoters. However, the Companies Bill, 2009 introduced in Parliament…
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A Change in the Law of Depreciation
[Posted by Shantanu Naravane] A recent decision of the Bombay High Court in CIT v. M/s Techno Shares & Stocks Ltd. seems to have greatly narrowed down the scope of depreciation under the Income Tax Act. Although the issue before the Court was only whether depreciation can be granted on a Bombay Stock Exchange Membership…
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Corporate Frauds and Regulatory Shortcomings: SEC’s Madoff Report
[Posted by Umakanth Varottil] A few days ago, the U.S. SEC’s Office of Inspector General (OIG) released a report (over 450 pages) identifying various lapses that led to SEC’s failure to uncover Madoff’s Ponzi scheme much earlier than December 2008 when the scandal broke out. To the interested reader, the executive summary might be more…
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Doing Business 2010: India’s Performance
[Posted by Umakanth Varottil] Doing Business 2010, a co-publication of the World Bank and the International Finance Corporation has bee released. Compared to India’s ranking of 132nd last year, it has dropped one notch to 133 this year. It has been noted that despite reforms during this period, India has been outperformed by other similarly-situated…