Yesterday’s board meeting at SEBI was not expected to generate any substantial decision owing to the impending change of guard at the regulatory institution. True to expectations, key matters such as amendment to the Takeover Regulations and implementation of the Jalan committee report on stock exchanges and other market infrastructure institutions were deferred. However, SEBI expressed its...
Literature on Takeover Regulations
I recently came across two papers dealing with the SEBI Takeover Regulations and other related legislation in India, and a discussion of issues that arise in takeovers of Indian companies. 1. The Emerging Market for Corporate Control in India: Assessing (and Devising) Shark Repellants for India’s Regulatory Environment by Abhinav Chandrachud. Abstract: Inbound and domestic hostile takeover...
Islamic Finance and the Indian Constitution
The concepts of Islamic banking and Islamic finance are yet to gain significant ground in India and attain the popularity they have witnessed in other countries. While there has been a debate about the need for a separate legal framework in India to promote the form of finance recognized under principles of Sharia law, the judiciary recently had the opportunity to test the validity of Islamic...
The 1st Annual SLR – Sage Essay Competition
Socio-Legal Review (SLR), the inter-disciplinary, peer-reviewed and student edited journal published by the National Law School of India University (NLSIU) and Sage Publications, the independent international publisher of books, journal and international media have announced the 1st Annual SLR – Sage Essay Competition. TOPICS Participants have to write the essay on any one of the following:...
Lobbying: An Indispensable Part of Pluralistic Democracy or the Evil That Needs to Be Shunned?
[The role of lobbying in the legislative and regulatory process in India has been the subject matter of great debate lately. In particular, the role of lobbyists in proving an interface between the corporate sector and various arms of Government is at the forefront. Lobbying has thus far been carried on in an informal manner, and the issue has received scant attention from a legal perspective. In...
Regulating Foreign Venture Capital Investors
In a post on the Critical Twenties blog, Sarika raises a number of issues (both legal as well as practical) that plague the regulatory system governing foreign venture capital investors (FVCI). Although success in innovation is usually propelled by a facilitative legal, regulatory and contractual system that allows unimpeded flow of capital to finance such innovation, the issues highlighted in...
Corporate Structure for Foreign Banks in India
Historically, the RBI appears to have had a preference for allowing foreign banks to operate in India as branches rather than separately incorporated subsidiaries. Consequently, most (if not all) foreign banks have been established as branches for the purposes of banking law as well as company law. Apart from the fact that a branch enjoys the support, creditworthiness, and solvency of the main...
Balco Arbitration Award: Section 111A of the Companies Act
A CNBC-TV 18 report and interview indicate that an arbitration panel has rejected Sterlite’s right to acquire the balance 49% in Balco by way of exercise of a call option. The report states: The arbitration panel comprised of two former chief justices of India and a third senior judge. When Sterlite acquired Balco’s 51% stake for Rs 550 crore in 2001 it was all fine, it had a call option to buy...
RBI Sub-Committee on Microfinance
With several legal and regulatory issues affecting the microfinance sector lately, more so in the state of Andhra Pradesh, the Reserve Bank of India (RBI) had appointed a sub-committee under the chairmanship of Mr. Y.H. Malegam to “study issues and concerns in the microfinance sector in so far as they related to the entities regulated by the [RBI]”. The keenly awaited report, which was expected...
A Case For Mandatory Dematerialisation of Securities
In yesterday’s Financial Express, Prof. Jayanth Varma makes a compelling case for abolition of physical share certificates and for mandatory dematerialisation of all shares. To supplement the arguments he makes, dematerialisation also impacts the manner in which transfers of shares are recognised in law. In the case of physical shares, a transfer obtains legal effect only if it is registered by...
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