MCA clarifies that procedure for issuing securities in dematerialised form will not apply to unlisted public company which is a wholly owned subsidiary
The Ministry of Corporate Affairs (“Ministry”) has, in a Notification dated 22nd January 2019 amended the Companies (Prospectus and Allotment of Securities) Rules, 2014 (“Principal Rules”), by notifying the Companies (Prospectus and Allotment of Securities) Amendment Rules, 2019 (“Amendment Rules”).
Key Highlight of the Amendment Rules
In the Principal Rules, in Rule 9A which states down the ‘procedure for the issue of securities in dematerialised form by unlisted public companies’, after sub-rule (10), a new sub rule (11) has been inserted which says that the aforementioned Rule will not be applicable to an unlisted public company which is:
i) a Nidhi;
ii) a Government company or
iii) a wholly owned subsidiary.
Source: Ministry of Corporate Affairs