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MCA: Policy for public consultation in rule-making
MCA: Policy for public consultation in rule-making

January 25, 2024

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As you are aware, the Ministry of Corporate Affairs (MCA) is responsible for administering the Companies Act, 2013, the Limited Liability Partnership Act, 2008, the Competition Act, 2002, Insolvency and Bankruptcy Code (IBC) and legislations relating to three professional institutes namely Institute of Chartered Accountants of India (ICAI), Institute of Company Secretaries of India (ICSI) and Institute of Cost Accountants of India (ICOAI).

It was observed that the practice of public consultation for regulation making is not uniform across all regulators. Hence, a need for public consultation in rule/regulation making exercise was for bringing in greater transparency and greater involvement of the stakeholders. The Hon’ble Finance and Corporate Affairs Minister in her Budget speech for the year 2023-24 also acknowledged the importance of public consultation process.

Given the above background, MCA has formulated a policy for pre-legislative consultation and for comprehensive review of rules/regulations. This policy is advisory in nature and aims towards carrying out public consultations both at the time of framing original rules and regulations, and at the time of review of the rules/ regulations. This policy shall be effective from January 1, 2024.

The divisions of and the regulators administered by MCA are expected to comply with the policy within the confines of the legislations, depending on the feasibility. The policy is divided into two parts; provisions pertaining to holding of public consultation at the time of framing rules and regulations are contained in Part A, and those with respect to review of existing rules and regulations are provided under Part B.

In line with the above policy, MCA has sought comments from stakeholders on the rules issued under the Companies Act, 2013, and the Limited Liability Partnership Act, 2008. Refer this link for detailed reports which are open for consultation till February 25, 2024. In case you have any feedback on these rules, please write to tejasvi@nasscom.in before February 16, 2024. We will accordingly make a representation to the MCA.

We look forward to hearing from you


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Tejasvi

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