MCA Notifies Amendment to Definition of Listed Companies

The Ministry of Corporate Affairs through a Notification, issued on 19.02.2021, has notified amendment to definition of Listed Companies. Further, the said amendment was made under the ambit of the powers conferred by way of section 2 (52) read with section 469 (1) and (2) of the Companies Act 2013. Also, the amendment was made under the Companies (Specification of Definition Details) Rules 2014, and will come into force from 01.04.2021.

Further, the amended rules will be known as the Companies (Specification of Definition Details) Second Amendment Rules 2021.

In this blog, we will discuss about the amendment to Definition of Listed Companies by MCA.

Amendments made to Companies (Specification of Definition Details) Rules 2014

The key amendment made to the Companies (Specification of Definition Details) Rules 2014 deals with the insertion of Rule 2A after Rule 2.

Further, the inserted rule deals with the Companies that will not be considered Listed Companies from now onwards, which are as follows:

• Public Limited Companies who have not Listed their Equity Shares on RSE (Recognised Stock Exchange), but have listed their following:

1. Non-Convertible Debt Securities, which are issued through Private Placement, based on the provisions of the SEBI (Issue and Listing of Debt Securities) Regulations 2008;
2. Non-Convertible Redeemable Preference Shares, which are issued through Private Placement, based on the provisions of the SEBI (Issue and Listing of Non-Convertible Redeemable Preference Shares) Regulations 2013;
3. Both of the categories as mentioned above;

• All the Private Companies who have listed their Non-Convertible Debt Securities, which are issued through Private Placement, on the Recognised Stock Exchange, based on the provisions of the SEBI (Issue and Listing of Debt Securities) Regulations 2008;
• All the Public Companies who have not listed their equity shares on the Recognised Stock Exchange, but have listed the shares based on a Stock Exchange in a jurisdiction, as mentioned under section 23 (3) of the Act;

Conclusion

In a nutshell, the MCA has amended the definition of Listed Companies by inserting Rule 2A, which specifies the companies which will not be eligible to be called as a Listed Company from 01.04.2021. Further, these amended rules are known as the Companies (Specification of Definition Details) Second Amendment Rules 2021.

Official MCA Notification on Amendment to Definition of Listed Companies

Also, Read: Companies (Share Capital and Debentures) Amendment Rules 2021 Notified by MCA