Companies Bill receives President's assent

The new Bill provides for sweeping changes in the way companies operate

The new Companies Bill has received President's assent. It will now be made into a law, replacing the nearly six-decade old regulations that govern corporates in the country.

The Companies Bill 2013 received assent from the President Pranab Mukherjee on August 29, a government official said.

The new Bill, providing for sweeping changes in the way companies operate and are regulated in the country, received Parliamentary approval earlier this month. It would replace the Companies Act 1956.

The Corporate Affairs Ministry is in the process of making the rules for the new legislation.

The draft rules, expected to be ready in two weeks, would be put out on the Ministry's website. After this, stakeholders and general public, among others, would have up to 60 days to provide their comments.

Corporate Affairs Minister Sachin Pilot had earlier said the government plans to adopt a transparent and interactive process to finalise a detailed set of rules to be adopted under the new Companies Bill.

The new Bill requires companies to spend on social welfare activities, empowers investors against any frauds committed by promoters, encourages companies to have women directors, and seeks to bring in greater transparency in corporate governance matters.

It also provides about three dozen new definitions, including for terms such as frauds, promoters, turnover, small companies, associate companies and employee stock options.