The proposed Corporate Laws (Amendment) Bill, 2026, which was introduced on 23 March 2026 by Finance Minister Nirmala Sitharaman in the Lok Sabha, seeks to amend the Companies Act, 2013, and the Limited Liability Partnership Act, 2008, in order to modernize the corporate regulatory framework in India. The Bill is being consultatively legislated to a Joint Parliamentary Committee (“JPC”) to continue its scrutiny.
The Key Objectives of the Bill are:
- Ease of doing business.
- Reducing compliance burden
- Enhancing corporate governance and transparency.
- Corresponding Indian corporate laws to international standards.
Further, the Bill offers:
- Decriminalisation of Offences
A number of procedural offences are suggested to transfer the criminal liability into civil penalties and minimize the litigation risk of businesses. - Broadening of Small Company Definition.
It is suggested to raise the threshold of small companies (up to 20 crore paid-up capital and 200 crore turnover) and be more lenient on compliance on more entities. - Fast-Track Mergers
Some mergers have their approval requirements simplified, allowing a company to be restructured quicker and enhance business flexibility. - Share Buyback Reforms
Firms can be permitted to do several buybacks in a financial year, and this enhances efficiency in capital allocation. - IFSC & LLP Reforms
LLPs in International Financial Services Centers (“IFSCs”) are offered special provisions, such as flexibility in accounting and regulatory compliance. - Strengthening Regulatory Oversight
Regulators such as the National Financial Reporting Authority are also suggested to be strengthened to provide improved accounting and auditing standards.
The Bill represents a two-sided style of liberalization (with decreased compliance) and enhanced governance (with additional regulatory control). It continues on the previous reforms that have been geared towards decriminalization and business enabling, making the corporate law regime in India more investor friendly. The JPC is in the process of reviewing the Bill, and its terms can be changed prior to being implemented. Upon its passage, it is likely to have great effects on corporate compliance, mergers, and governance in India.