Lok Sabha Speaker Om Birla receives the Report of the Joint Committee on the Corporate Laws (Amendment) Bill, 2026 from the Committee, at Parliament House, in New Delhi on Tuesday
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The Corporate Laws (Amendment) Bill, 2026 is expected to ease compliance for listed companies, facilitate faster corporate restructurings and give companies greater flexibility in returning capital to shareholders, even as it strengthens the audit oversight framework, said legal experts.Among the key changes are the decriminalisation of several procedural defaults, a more flexible buyback framework, faster approvals for corporate restructurings, permanent recognition of hybrid shareholder meetings and a stronger institutional framework for the National Financial Reporting Authority (NFRA)."The amendments relating to buy-backs, audit oversight and compliance rationalisation are likely to have the greatest practical impact on listed companies and investors," said Alay Razvi, Managing Partner at Accord Juris.Tighter executionThe Bill allows prescribed classes of companies to undertake up to two buybacks in a year, subject to a six-month cooling-off period, while SEBI has recently reintroduced the open-market route under tighter execution norms. Together, the changes could encourage companies to use buybacks more strategically alongside dividends.“While this generally provides greater flexibility to companies, listed companies are also required to follow the requirements of the SEBI buyback regulations and subject to the requirements of minimum public shareholding norms, which may make the flexibility beyond 25 per cent less relevant," said Mohit Gogia, Partner at Cyril Amarchand Mangaldas.Simplify corporate restructuringsThe Bill also seeks to simplify corporate restructurings by allowing a single national company law tribunal application for schemes involving multiple entities, reducing approval thresholds for fast-track mergers and removing certain procedural requirements for demergers. It further decriminalises several procedural defaults and introduces a consent settlement mechanism, enabling companies to settle penalty proceedings before an order is passed.According to Akshat Pande, Managing Partner at Alpha Partners, the shift from criminal prosecution to civil penalties for procedural lapses would significantly reduce litigation risk for directors and officers while allowing companies to resolve historical compliance issues ahead of mergers and acquisitions. The streamlined merger provisions are also expected to facilitate faster group restructurings and pre-IPO reorganisations.The Bill also gives NFRA statutory backing as an independent regulator with enhanced supervisory and enforcement powers, including direct oversight of auditors within its jurisdiction. Listed companies could face greater scrutiny of audit quality and increased reporting obligations.Pande said, however, that the amendments do not fully eliminate the possibility of parallel proceedings before NFRA and the Institute of Chartered Accountants of India (ICAI), as the legislation does not lay down a mechanism to resolve potential jurisdictional overlap. Even so, he said the changes significantly strengthen India's audit regulatory framework and are expected to improve accountability and investor confidence in financial reporting.GIFT City and the investment fund industry, including those providing IFSC-linked financial services, gain the most, since companies and funds based there can now keep their share capital and accounts in foreign currency and investment trusts may convert into LLPs. For Alternative Investment Funds (AIFs), historically dominated by the trust structure due to LLP filing rigidity, the ability to convert into LLPs allows relaxed periodic, rather than event-by-event, reporting for SEBI/IFSCA-regulated LLPs.Published on August 4, 2026
