The idea of Mumbai Metro - Is the world developing or dying?

The Mumbai metro project (“Metro Project”) was conceptualised to develop an efficient and sustainable urban transport system in the financial capital of the country, involving  a significant investment of USD 2,500 million.[1] Every day some 80,00,000 commuters use the city’s suburban rail system, enabled through more than 2,800 trains a day. The network is severely overcrowded during peak hours when the number of passengers exceed the network’s carrying capacity by more than four times, leading to numerous safety hazards.[2]

Last year witnessed a massive protest for saving the Aarey milk colony located in suburban Goregaon (“Aarey’), a green belt with over 5,00,000 trees, a rarity in the concrete city. The construction of a metro car depot on the flood plains of the Mithi river at Aarey for expansion of metro services in the city received much wrath from environment activists, citizens and even courts for cutting down 2,600 trees overnight. While there is a stay on cutting more trees until the matter is sub-judice, the construction work of the Metro Project was not stopped, until the outbreak of a worldwide pandemic, COVID-19 or Coronavirus. Continue Reading The Idea of Mumbai metro- Is the World Developing or Dying?

Innocent Tippee Liability under Insider Laws

The SEBI Insider Trading Regulations prohibit trading in securities whilst in possession of unpublished price sensitive information (UPSI). It also states that when a person holds UPSI and trades in securities, his trades would be ‘presumed’ to have been motivated by the knowledge and awareness of such information in his possession.

Given that the burden of proof is on the insider to establish that his trade was not motivated by awareness of such information, the Regulations to provide statutory defences for the insider to prove his innocence. The stated defences, which are illustrative in nature, however, do not include a circumstance where a person has received UPSI and relied on it to make a trade under the assumption that it is publicly available information. The ‘innocent recipient’ was proposed as a statutory defence in the NK Sodhi High Level Committee Report, but did not find its way into the final form of the amended regulations. This defence was meant to be available if the recipient had no reason to believe that the information in his possession was UPSI or the person who communicated it to him violated any law or confidentiality obligation. As per the report, the insider would need to prove that he did everything reasonably in his power to confirm that the information in his possession was not UPSI (i.e. exercise of diligence expected of a reasonable man) and that he traded bona fide. Continue Reading Innocent Tippee Liability under Insider Laws

Digital Transformation in Law - People, Process and Technology

Covid-19 has brought the world to a halt but with all the challenges it brings, it has also given the legal industry a rare opportunity to change the way we have been practicing and conducting the business of law.  Over the past few weeks, we have seen the stage being set for making the change, the change that we all have been assessing and contemplating and have yet always resisted and to some extent ignored.  The magnitude of the change requires all stakeholders to contribute and participate towards making this a reality.  It is now time for us to come together to convert Covid – 19 into a positive opportunity for the legal fraternity. The change we need to make is based on the framework of People, Process and Technology. For driving organisational efficiencies, it is the people who work with processes and technology to deliver greatest results. Going forward it will be essential for all three elements to work in sync for a smooth transition. Continue Reading Digital Transformation in Law : People, Process and Technology

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COVID-19 TEST KITS. A CHEAT SHEET

The COVID-19 pandemic has literally brought the world to a standstill. Large scale infections have resulted in lockdowns across the globe. At this critical juncture, testing continues to remain the most important step to get a grip over the situation. The situation in India is no different. With an upsurge in the number of COVID-19 cases in India, the need for largesse testing has become paramount. Low availability of test kits remains a cause of great concern to the government and healthcare practitioners. This is compounded by our massive populace, given the quantity that is required in the current scenario. This lack of availability of test kits is primarily because India does not have adequate indigenous manufacturing units of COVID-19 test kits and relies heavily on imported kits.

From a regulatory standpoint, such kits fall under the category of ‘in-vitro diagnostic’ kits under the Drugs and Cosmetics Act, 1940 (D&C Act) read with the Medical Devices Rules, 2017 (MD Rules) and are regulated as ‘medical devices’[1]. Continue Reading COVID-19 Test Kits. A Cheat Sheet

Put option Holders - Financial Creditors under the IBC – Part 2

In our previous post, we discussed the La-Fin Judgments passed by the NCLAT (Pushpa Shah v. IL&FS Financial Services Limited[1]) and NCLT[2], which had held that a put option holder may be treated as a ‘financial creditor’ under the Insolvency & Bankruptcy Code, 2016 (IBC). A three-judge bench of the Supreme Court set aside the La-Fin Judgments in Jignesh Shah vs Union of India[3] primarily on the technical grounds of limitation without expressing a view on whether the NCLT and NCLAT were correct in treating a put option holder as a financial creditor.

This was followed by the landmark decision of Pioneer Urban and Infrastructure Limited vs Union of India (Pioneer Judgment)[4] in which the Supreme Court interpreted the provisions of Section 5(8)(f) of the IBC in a manner similar to that done in the La-Fin Judgments, stating that the provision would subsume within it “amounts raised under transactions which are not necessarily loan transactions, so long as they have the commercial effect of a borrowing” and “done with profit as the main aim.” Continue Reading Put option Holders: Financial Creditors under the IBC? – Part 2

Back to the future - restoring the Mauritius route for FPI investments

Background

On September 23, 2019, the Securities and EXCHANGE Board of India (“SEBI”) notified the SEBI (Foreign Portfolio Investors) Regulations, 2019 (“New FPI Regulations”), overhauling the erstwhile SEBI (Foreign Portfolio Investors) Regulations, 2014 (“Erstwhile FPI Regulations”). Under the New FPI Regulations, SEBI recategorised FPIs in to two categories (as against the three categories under the Erstwhile FPI Regulations), based on their regulatory status and jurisdiction of residence. Under the New FPI Regulations, Category I FPIs include sovereign wealth funds, pension funds, appropriately regulated entities, certain endowments and other entities from the Financial Action Task Force (FATF) member countries, which are appropriately regulated funds or unregulated funds whose investment manager is appropriately regulated and registered as Category I FPI or is owned to the extent of at least 75% by certain Category I FPIs. Category II FPIs include entities that do not qualify for Category I status under the New FPI Regulations. Further, on account of the overhauling and recategorisation under the New FPI Regulations, those Category II FPIs under the Erstwhile FPI Regulations, which did not qualify to be recategorised as Category I FPIs under the New FPI Regulations got recategorised as Category II FPIs under the New FPI Regulations, along with Category III FPIs under the Erstwhile FPI Regulations. Hence, with one stroke of the pen, Mauritius based FPIs became disentitled for Category I status as Mauritius is not an FATF member. Continue Reading Back to the Future: Restoring the Mauritius Route for FPI investments

Barbarians at the gate – no entry without approval

To say that the Covid-19 has unleashed unprecedented times is an understatement. Every country, government, regulator and citizen across the globe is trying to come to terms with the implications of this deadly virus and surviving it. It is indeed a Hobson’s Choice – to save lives or to save the economy. But several countries, in said and unsaid words, have expressed vulnerability to the corporate raiders from China! They are literally at the gate and it has become a cause of worry for most governments and corporations.

Japan has proposed building an economy that is less dependent on China, so that Japan can mitigate supply chain disruptions caused by the current Covid-19 pandemic. To this end, Japan announced an emergency economic package on April 7, 2020, earmarking 240 billion yen (approximately USD 2.2 billion) for fiscal 2020 to pay  Japanese manufacturing firms to leave China and relocate production either to their home country or to diversify their production bases into South East Asia. Australia, Italy, Spain, and Germany have announced amendments to their respective foreign investment laws to make acquisitions and takeovers by foreigners much harder. So has the European Union. The Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA) of the United States has seen increased review of foreign investments under the Trump administration due to security and national interest concerns. Continue Reading Raising the Wall – No Entry without Approval

 

Corporate house-keeping during a crisis

Secretarial compliances, periodic reporting and disclosure requirements, programmed into the DNA of listed companies, often proceed seamlessly following protocols defined by the legal regime and industry best practices. However, with social distancing advisories changing the way in which corporate India goes to work, management and secretarial teams will need to re-assess established protocols and approach day to day internal housekeeping matters a little differently in the coming months. Continue Reading Corporate house-keeping during a crisis

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DIAL-A-DOCTOR-A-look-at-the-Telemedicine-Practice-Guidelines-2020

The Ministry of Health and Family Welfare (“MoHFW”), on March 25, 2020, issued the Telemedicine Practice Guidelines (“Guidelines”) providing Registered Medical Practitioners (“RMPs”) with guidelines to treat patients remotely by using the telemedicine tools at their disposal.

Concepts such as telemedicine have gained prominence pursuant to the rapid development of information technology and the need to service the requirements of patients who may not be able to visit healthcare facilities, or have little to no access to the same. Such services involve the transfer of medical information and expertise through telecommunication and computer technologies and aim to facilitate diagnosis, treatment and management of patients. Currently, in India, platforms such as ‘practo’ and ‘DocOnline’ exist which facilitate online medical consultations albeit in a restricted manner given stringent regulatory controls on the practice of medicine. Though such platforms would help to deliver widespread healthcare services, there exist several concerns that exist about the medicolegal implications of telemedicine relating to registration, licensing, insurance, quality, privacy and confidentiality issues, as well as other risks associated with electronic health care communication. Continue Reading DIAL A DOCTOR- A look at the Telemedicine Practice Guidelines, 2020

Covid-19 And M&A In India - Navigating Risks And Understanding Opportunities 

As the Covid-19 crisis deepens, and the number of positive cases and casualties continue to mount rapidly, governments across the world are enforcing stringent lockdown and social distancing measures. With the engines of economic growth grinding to a halt, the pandemic has mutated into an economic crisis, plunging the global economy into an unparalleled recession. India is no exception[1], and mergers and acquisitions (M&A) in India is sure to sniffle, snuffle and sneeze, at least in the short-term. From a legal standpoint, we believe that there will be consequent changes and fundamental shifts in the M&A landscape. Continue Reading COVID-19 and M&A in India: Navigating Risks and Understanding Opportunities