Bill Aimed at Modernizing Business Regulations Faces Objections from Opposition

The Corporate Laws (Amendment) Bill, 2026 was introduced in the Lok Sabha by Finance and Corporate Affairs Minister Nirmala Sitharaman on March 23, 2026, aiming to streamline regulatory processes for Companies.

Proposed changes in the Bill:

• Decriminalize minor offences by shifting penalties to fines from jail terms.
• Raise the profit threshold for CSR (Corporate Social Responsibility) from the present Rs 5 Cr profit to Rs 10 Cr profit and increase time limit to transfer unspent CSR funds to bank accounts from the present 30 days to 90 days. Small companies are proposed to be exempted from CSR requirement altogether. 
• Proposal the companies can hold AGMs/EGMs through videoconferencing, with at least one mandatory physical AGM required to be held in three years.

The opposition has shown concern that this will reduce Corporate accountability and gives too much power to the Government (by diluting Parliamentary oversight). Dilution of the CSR (by raising the limit) too was opposed, where Companies would spend 2% of their profits for social purposes.

OUR VIEW:

The Corporate Laws Amendment Bill is a very important bill to make India more business-friendly, by reducing the compliance burden through the steps proposed in the Bill, and giving more powers to the NFRA (National Financial Reporting Authority) to strengthen governance.

The Bill has been referred to a 31-member joint committee, which will submit its report on the last day of the first week of the Monsoon Session. This will ensure that the Bill gets finalized after a thorough discussion with all parties concerned.

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Link: https://economictimes.indiatimes.com/news/economy/policy/government-introduces-bill-to-amend-companies-llp-laws-proposes-changes-in-csr-norms/articleshow/129757852.cms?from=mdr