DISCLOSURE OF COVID-19 IMPACT BY LISTED ENTITIES - FINDING THE RIGHT BALANCE

Across India, each subsequent phase of the lockdown has permitted a responsible increase in economic activity. As companies re-start their operations, they continue to assess the impact of Covid-19 pandemic on their businesses and operations, which is rapidly and continuously evolving. Listed entities are particularly conscious of their disclosure obligations, more so after the Securities and Exchange Board of India (“SEBI”) issued a circular on May 20, 2020 (the “Circular”), that outlined the relevant considerations for companies in relation to the disclosures on the impact of Covid-19 on their businesses, performance and financials. The Circular is not only a restatement of the current principle-based disclosure regime, but is also indicative of the regulatory expectation on disclosures going forward in relation to impact of Covid-19 pandemic as it evolves.
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Rights Issue - Regulatory to and fro on renunciation

On April 27, 2020, the Central Government notified the Foreign Exchange Management (Non-debt Instruments) (Second Amendment) Rules, 2020 (“FEMA NDI Amendment”). The FEMA NDI Amendment seeks to modify the position on pricing of rights issue – in case of renunciation of rights in favour of a non-resident by a resident, pricing guidelines will apply. We have analysed the implications of the FEMA NDI Amendment on rights issue of securities in this blogpost.

Why Rights issue?

Rights issue has been a preferred mode of raising capital from the existing shareholders of a company as there are no prescriptive conditions on issue price. Companies have the flexibility to determine issue price in case of rights issue under company law as well as SEBI regulations (applicable to listed companies). This gives companies much-needed flexibility to structure a capital raise from existing investors, especially in times of need.
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Validity of Operational Licenses In The Wake of Covid-19 – A Grey Area

In the wake of the pandemic Covid-19, many legal and regulatory modifications have been undertaken in the country to facilitate compliances by the business houses as well as ease of doing business.

Recently, the Ministry of Corporate Affairs, Securities and Exchange Board of India, Insolvency and Bankruptcy Board of India, Real Estate Regulatory Authority, to name a few, have issued various regulations as well as amended the existing ones to suitably modify timelines and processes needed for secretarial compliances, periodic reporting, disclosure requirements, tasks to be undertaken under liquidation process etc.
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COVID-19 - Temporary Relaxations for Corporate Compliances

The global outbreak of coronavirus (COVID-19) is an unprecedented event that has led to lockdowns and unexpected restrictions on the public as well as the corporate sector across the world. In order to control its spread, the Government of India (GoI) has inter alia ordered all establishments, except organisations providing essential goods and services, to temporarily close their physical offices. Employees are working remotely, but due to difficulties faced in coordination and lack of office facilities, companies are likely to face difficulties in undertaking timely compliances of various applicable laws. Keeping in mind the aforesaid, the GoI has temporarily relaxed a number of compliance requirements for the corporate sector. We have analysed below some of the major relaxations from securities and companies law perspective.
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COVID 19 - Online Courts in India

Work from home for a litigating lawyer in India currently looks like endless hours of reading, chores and on-demand video. In this blog, we argue that this will be a short-lived state of affairs. Remote working for litigation will be operationalised soon and will become the new normal for litigating lawyers in the not too distant future.

Courts are an essential service for civil society. In the wake of the COVID-19 pandemic, courts across the country have gone into an urgent-only, online-only mode with electronic filings, email mentions and, in exceptional cases, online hearings via video conferencing/ video calling facilities. This urgent only model of restricted judicial access is not sustainable past the initial lockdown. Courts will have to resume a full-time case load in the near future, albeit in a form that will be quite different from the way as we knew it. The urgent-only format will come to pass, with courts adopting the online-only format for its regular functioning. As a first step, the Supreme Court of India issued a suo-motu order yesterday setting out guidelines for courts to function through video conferencing during the COVID 19 Pandemic.
Continue Reading From the Gavel to the Click: COVID 19 poised to be the inflection point for Online Courts in India

Coronavirus - COVID19- Faqs

The World Health Organisation (WHO) declared COVID-19 as a “pandemic” on March 11, 2020.

The outbreak and the rapid spread of COVID-19 has sent shock waves across global markets. It has disrupted supply chains, leading to the closure of several manufacturing facilities globally; serious disruption of air and sea traffic and closure of vital air routes, like the one between the US and Europe. This is turn has led to the collapse of stock markets around the world, leading to the loss of billions of dollars, which got wiped out in a matter of days. A combination of all these factors has led to a decline in the overall volume of global economic activity, forcing the world economy towards a possible recession. It is forcing Boards across the globe to confront a host of difficult questions on how business should be conducted during a global public health crisis.
Continue Reading COVID-19 : OFFICIALLY A PANDEMIC

CHAIRMAN OR MANAGING DIRECTOR SEBI Regulation

Section 203(1) of the Companies Act states that an individual shall not be appointed or reappointed as the chairperson, of the company as well as the managing director (MD) or the chief executive officer (CEO) at the same time, unless the articles of the company provides otherwise or the company does not carry on multiple businesses. Further, this restriction is not applicable to certain specified class of companies engaged in multiple businesses and which have appointed one or more CEOs for each such business.
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Contract Manufacturing - Press Note 4

The question of whether contract manufacturing constitutes “manufacture” from a foreign investment perspective is an oft debated topic in the manufacturing fraternity and many businesses have struggled with this issue for years.

“Contract manufacturing” refers to manufacturing undertaken through a third party and has a range of benefits for the principal manufacturer, including economic efficiency, scale, operational efficiencies and flexibility. For instance, if a specialised set of equipment or skills is required to manufacture a certain product, the principal manufacturer can use the facilities already available with a third party to manufacture these products, instead of investing its capital in creating these facilities for itself. Contract manufacturing also enables a principal manufacturer to utilise a contract manufacturer’s existing supply chains, linkages and labour force. If a principal manufacture has a cyclical manufacturing business, using the facilities of a third party may be more beneficial than making capital investments that may lie idle for large parts of the year. In light of these benefits, contract manufacturing as a business model is one that is preferred by many entities in the manufacturing business.
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Surveillance in the Post-Puttaswamy Era - Right to Privacy

In 1997, the Supreme Court of India (Supreme Court) pronounced its judgment in the case of People’s Union for Civil Liberties (PUCL) v. Union of India (SC, 1997) (PUCL Case), which laid the groundwork for the right to privacy in the context of telephonic surveillance (i.e. wiretaps) and constitutional freedoms.

This article analyses the Supreme Court’s stance on the right to privacy in the PUCL Case, which was upheld in the 2017 landmark judgment by the nine-judge bench in KS Puttaswamy v. Union of India (SC, 2017) (Puttaswamy Case) that declared privacy a fundamental right. The applicability of the right to privacy has recently received further validation in the context of wiretaps in the October 2019 judgment in Vinit Kumar v. Central Bureau of Investigations and Ors (Bom HC, 2019) (Vinit Kumar Case), wherein the Bombay High Court outlined the ambit of the State’s power to surveil its subjects particularly on matters that do not fall within the category of ‘public emergency’ or ‘in the interest of public safety’.
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To Bet or Not to Bet - Sports Betting Laws in India

As the society changes, the law cannot remain immutable”

– Justice D P Madon

They say cricket is not a game, it is a religion. In 2019, the India – Pakistan ICC World Cup match saw a viewership of 229 million within India itself[1]. The importance of cricket as a unifying force cannot be debated and needn’t be proved; what is rather interesting is the ancillary impact a simple match of cricket can have on an economy, such as India.

Economic exploitation of cricket is widespread globally: it includes broadcasting rights, sponsorship and merchandising, to name a few. However, another prevalent and illegal exploitation in the form of betting takes precedence over all of the above, for the simple reason that due to the nature of the transaction, the said consideration paid, is officially taken out of India’s financial system and put into a parallel industry, which remains untaxed and unregulated.
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