Ministry of Corporate Affairs (MCA) has issued several amendments in certain rules made under the Companies Act, 2013 on May 07, 2018. This Article attempted to analyze important changes in Companies (Prospectus and Allotment of Securities) Rules, 2014, which was last amended by the Ministry of Corporate Affairs in New Delhi dated 15.02.2018.
Ministry of Corporate Affairs notified various Sections of the Companies Amendment Act, 2017 to further amend the Companies Act, 2013. Consequential amendment rules made are as follows:
- Companies (Meetings of Board and its Powers) Amendment Rules 2018
- Companies (Audit and Auditors) Amendment Rules 2018
- Companies (Prospectus and Allotment of Securities) Amendment Rules 2018
- Companies (Appointment and Qualification of Directors) Second Amendment Rules 2018
- Companies (Share Capital and Debentures) Second Amendment Rules 2018
- Companies (Registration Offices and Fees) Second Amendment Rules 2018
- Companies (Specification of Definitions Details) Amendment Rules 2018
- Companies (Meetings of Board and its Powers) Amendment Rules, 2018
This article provides an overview of the Companies (Prospectus and Allotment of Securities) Amendment Rules, 2018. The Central Government made Companies (Prospectus and Allotment of Securities) Amendment Rules, 2018 to further amend the Companies (Prospectus and Allotment of Securities) Rules, 2014. Ministry of Corporate Affairs issued a Notification in New Delhi, the 7th May 2018 G.S.R. 430 (E) The Amendment made is presented in a tabular form below:
| Existing Provision | Provision Description |
Amendment |
| Rule 3 | Information to be stated in the Prospectus | Omitted |
| Rule 4 | Reports to be set out in the Prospectus | Omitted |
| Rule 5 | Other matter and reports to be set out in the Prospectus | Omitted |
| Rule 6 | Period for which information to be provided in certain cases | Omitted |
For a summary of all the Rules notified by MCA read: Companies Amendment Act 2017-Summary of Rules Notification
The Amendment Act, 2017 empowers SEBI to prescribe the contents of a prospectus. Accordingly, a public company is not required to provide certain details in the prospectus such as names and addresses of its registered office, dates of the opening and closing of the issue, its capital structure, and auditor’s report on the company’s profits/losses and liabilities. Therefore, these clauses have been omitted through the Amendment Act, 2017.
Similar provisions have been removed from the Companies (prospectus and Allotment of Securities) Rules, 2014.
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