Circulars Issued By Other Authorities

1.Circulars/Notifications by Reserve bank of India

Fair Practices Code for Asset Reconstruction Companies

The Reserve Bank of India (“RBI”) vide notification dated 16.07.2020 issued guidelines on the Fair practice code for Asset Reconstruction Companies (ARCs), which inter alia includes that, to enhance transparency in the process of the sale of secured assets, the spirit of Section 29A of Insolvency and Bankruptcy Code, 2016 may be followed by ARCs in dealing with prospective buyers. Further, the ARCs are advised to put in place Fair Practices Code (FPC) duly approved by their Board.

2.Circulars/Notifications by Reserve bank of India

Securities And Exchange Board Of India (Issue Of Capital And Disclosure Requirements) (Second Amendment) Regulations, 2020

Vide notification dated 22.06.2020, SEBI introduced Regulation 164A “Pricing in the preferential issue of shares of companies having stressed assets” in the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018.

As per the amendment, under sub-regulation (3) of Regulation 164A, conditions to be met by the issuer company making the preferential issue have been laid down, one of which states that the preference issue shall not be made to a person who is an undischarged insolvent in terms of the Insolvency and Bankruptcy Code, 2016. In addition to that, preference issue shall also not be made to a person who has been convicted for any offense punishable with imprisonment for two years or more under any Act specified under Twelfth Schedule XII of I&B Code. Some of the Acts under the abovementioned Schedule are the Reserve Bank of India Act, 1934, the Income-Tax Act, 1961, the Foreign Exchange Management Act, 1999, I&B Code, etc.

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