Ministry of Corporate Affairs has notified Companies (Prospectus and Allotment of Securities) Amendment Rules, 2019 on 22nd January, 2019. The amendment has been made in Rule 9A of the Companies (Prospectus and Allotment of Securities) Rules, 2014.
Rule 9A was inserted by Companies (Prospectus and Allotment of Securities) Third Amendment Rules, 2018 and it came into force on 2nd October, 2018. As per the Rule, it was made mandatory for every unlisted public company to issue securities only in dematerialised form and also to facilitate dematerialisation of all its existing securities. By this amendment, exemption has been provided to Nidhi companies, Government companies and wholly owned subsidiaries.
By the amendment, after sub-rule (10) of Rule 9A, the following shall be inserted, namely:—
“(11) This rule shall not apply to an unlisted public company which is:—
(a) a Nidhi;
(b) a Government company or
(c) a wholly owned subsidiary.”
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