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Cabinet likely to take up Companies Bill today

The Union Cabinet is likely to take up the Companies Bill today. The bill introduces Corporate Social Responsibility (CSR), class action suits and fixed term for independent directors.

The finance ministry and SEBI had sought review of provisions, which conflicted with the SEBI Act. However, differences over SEBI's jurisdictions have been ironed out. In a step that would perhaps provide some teeth to the capital market watchdog Securities and Exchange Board of India, the finance ministry and the market regulator have agreed to uphold Sebi’s views in cases where jurisdictions conflict.

The Bill that has already been vetted by the Parliamentary Standing Committee; it envisages contribution of 2 per cent of average profit of the preceding three years for Corporate Social Responsibility (CSR) related activities. It also proposes to tighten laws for raising money from the public and prohibit any insider trading by company directors.