Startups to get waiver from regulatory filings |
Indian government has proposed to let startups issue sweat equity and grant additional exemptions as it eases norms for them under the Companies Act with a view to boost entrepreneurship in the country. The ministry of corporate affairs plans to allow startups to issue 50% of their paid up capital as sweat equity and extend the period of exemptions from other regulatory filings for up to 10 years instead of five now. They will be exempted for 10 years from a rule that bars private companies from raising deposits exceeding 100% of their paid¬ up share capital. The Department for Promotion of Industry and Internal Trade expanded the definition of startups earlier this year to state that entities would be considered startups for up to 10 years from the date of their incorporation. A notification would be issued soon to put into effect the proposed changes, although relaxation of norms on financial filings for startups would require an amendment to the Companies Act by the Parliament. The government has taken several measures to boost the startup ecosystem, including giving them relief from angel tax. It is looking to enhance the startup fund of funds, which invests in venture capital and alternative investment funds that in turn invest in startups.
|
|
|
|