The Corporate Laws (amendment) Bill, 2026: What Companies in India Need to Know

The Corporate Laws (Amendment) Bill was introduced in the Lok Sabha on 23 March 2026, marking the most sweeping set of proposed changes to the Companies Act, 2013 and the Limited Liability Partnership Act, 2008 in nearly a decade. The Bill targets decriminalisation of minor procedural defaults, raises the small-company thresholds that determine filing obligations and secretarial-audit applicability, and introduces simplified fast-track merger routes for startups and smaller entities. For company secretaries, CFOs and in-house counsel, the practical question is immediate: which ROC filings, AOC‑4, MGT‑7, MGT‑7A, change, who gets reclassified, and what should the board minute right now?

This guide translates the Bill’s clause-level proposals into a step-by-step compliance action plan with worked examples, a comparison table and a downloadable ROC filing checklist.

Executive Summary: Key Takeaways from the Corporate Laws (Amendment) Bill

The Bill proposes amendments to more than 50 sections of the Companies Act, 2013 and several provisions of the LLP Act, 2008. Its stated objectives are to reduce the compliance burden on smaller companies, align India’s corporate framework with international best practices, strengthen investor protection and facilitate ease of doing business through the International Financial Services Centre (IFSC) regime.

The official text is available on the eGazette portal, while PRS India’s bill tracker provides a running legislative-status summary. As of May 2026, the Bill has been introduced but has not yet been passed or referred to a Joint Parliamentary Committee.

Five key takeaways every company should note:

• Higher small-company thresholds. Paid-up capital and turnover ceilings are proposed to increase significantly, potentially bringing thousands of additional private companies within the simplified-filing regime (MGT‑7A instead of MGT‑7).
• Decriminalisation of minor defaults. Several procedural non-compliances currently attracting criminal prosecution will shift to a civil-penalty framework adjudicated by officers, reducing litigation risk for directors and company secretaries.
• Fast-track mergers expanded. The scope of Section 233 fast-track mergers is proposed to widen, enabling startups and small companies to restructure without a full NCLT process.
• IFSC and LLP liberalisation. New provisions facilitate foreign-currency denominated operations within GIFT City IFSCs and permit conversion of certain trusts and unregistered entities into LLPs.
• Buyback and IEPF changes. Amendments to Section 68 (buyback) and the Investor Education and Protection Fund transfer obligations will alter how companies handle unclaimed dividends and share repurchases.

What the Corporate Laws (Amendment) Bill 2026 Actually Proposes

Understanding the Bill requires breaking it into five thematic clusters. Each cluster maps directly to specific ROC forms, board resolutions and compliance workflows that practitioners manage daily.

Decriminalisation and Penalties

The Bill proposes to decriminalise a range of compoundable offences under the Companies Act, 2013. Where the current statute imposes imprisonment or criminal fines for delays in filing annual returns, failure to maintain certain registers, or minor disclosure lapses, the proposed amendments replace these with monetary penalties adjudicated through an in-house adjudication mechanism under Section 454. Industry observers expect this shift to materially reduce the burden on magistrate courts and incentivise voluntary compliance rather than fear-driven filing. The practical effect for companies is that directors and company secretaries will face civil liability rather than criminal prosecution for technical non-compliances, but the monetary penalties themselves may be substantial, so diligence remains essential.

Small Company Thresholds

Section 2(85) of the Companies Act, 2013 currently defines a “small company” based on paid-up share capital and turnover ceilings. The Bill proposes raising both thresholds. This reclassification has cascading effects: companies newly qualifying as “small” become eligible to file the simplified annual return in Form MGT‑7A (instead of MGT‑7), may be exempt from mandatory secretarial audits, and can use an abridged board-report format. The precise numbers are set out in the Bill text published on the eGazette, and companies should verify whether their most recent financial-year figures bring them within the revised definition.

Buyback, IEPF and Investor-Protection Rules

The amendments to Section 68 (share buyback) and Section 124/125 (IEPF transfers) are designed to streamline procedures while strengthening investor safeguards. The Bill proposes adjustments to the timelines for transferring unclaimed dividends and shares to the IEPF, as well as changes to the buyback-window calculations and board-resolution requirements. These provisions will directly affect the AOC‑4 annexure filings and the annual-return disclosures in MGT‑7.

IFSC and LLP Changes

For entities operating within an International Financial Services Centre, the Bill introduces carve-outs that permit foreign-currency denomination of share capital, relaxed meeting requirements and simplified filing norms. Simultaneously, the LLP Act amendments allow conversion of certain trusts and unregistered bodies into LLPs, creating a new incorporation pathway that intersects with SPICe+ procedures. The likely practical effect will be a surge in IFSC-registered entities and LLP conversions, both requiring careful ROC documentation.

Fast-Track Mergers and Restructuring

Section 233 currently limits fast-track mergers to companies meeting restrictive asset and turnover thresholds. The Corporate Laws (Amendment) Bill 2026 proposes expanding eligibility to include startups (as defined under DPIIT notifications) and a broader category of small companies. If enacted, this will allow qualifying entities to merge through a Regional Director process rather than a full NCLT application, saving months and significant legal costs.

Quick Comparison Table: Current Law vs Proposed Changes

Who Is Affected: Company Types, Small Company Thresholds and Worked Examples

The changes under the corporate laws amendment bill do not affect all companies equally. The impact analysis depends on company type, size and sector. Here is a practical breakdown of who needs to act.

Small companies (Section 2(85)): The raised thresholds mean that private companies previously classified as “non-small” may now qualify. A company that was above the current ₹4 crore paid-up capital limit but falls below the proposed higher ceiling will reclassify as “small” and unlock simplified filing.

Worked Example 1: A Delhi-based IT services private limited company with paid-up capital of ₹5 crore and annual turnover of ₹35 crore currently does not qualify as a small company. If the proposed thresholds increase both ceilings above these figures, the company would reclassify, becoming eligible to file MGT‑7A instead of the full MGT‑7 and potentially gaining exemption from mandatory secretarial audit.

Worked Example 2: A Mumbai manufacturing private limited with paid-up capital of ₹2 crore and turnover of ₹18 crore already qualifies as a small company under existing law. The Bill does not remove this status, it simply means the company continues to enjoy simplified filings and may benefit from additional relief on penalties and merger routes.

Worked Example 3: A Bengaluru DPIIT-registered startup with turnover of ₹50 crore does not meet the small-company definition (whether current or proposed) but will benefit from the expanded fast-track merger route under the amended Section 233, provided it retains valid DPIIT recognition.

Startups: The expanded fast-track merger provision is a significant win, allowing restructuring through a Regional Director application. However, startups must maintain active DPIIT registration to qualify.

IFSC entities: Companies registered in GIFT City’s IFSC will see the most targeted relief, foreign-currency share capital denomination, relaxed meeting norms and sector-specific filing simplifications.

Listed companies: The Bill’s small-company definitions explicitly exclude listed companies, so BSE/NSE-listed entities will not benefit from threshold-driven filing relief. However, the IEPF and buyback amendments apply equally to listed and unlisted companies.

ROC Filing Obligations: AOC‑4, MGT‑7 / MGT‑7A and Practical Steps

This is the section most company secretaries and practising professionals will return to repeatedly. The companies act amendments 2026 alter the ROC filing requirements in several ways, even though the Bill does not always name specific MCA forms. The changes flow from the amended statutory sections to the rules and forms that implement them.

AOC‑4: Financial Statement Filings

Form AOC‑4 (and AOC‑4 XBRL for applicable companies) is the vehicle for filing financial statements with the Registrar of Companies. The Bill’s amendments to IEPF-related disclosures and buyback provisions will alter the annexure requirements attached to AOC‑4. Specifically:

• IEPF disclosures: Companies will need to ensure that the statement of unclaimed dividends and shares transferred (or due for transfer) reflects the new procedural timelines proposed in the Bill.
• Buyback reporting: If your company undertook a share buyback during the financial year, the revised Section 68 parameters may require updated board-report disclosures filed alongside AOC‑4.
• CSR reporting: Where CSR threshold changes affect applicability, the CSR annexure (AOC‑4 attachment) must be recalibrated against the revised definitions.

MGT‑7 vs MGT‑7A: Who Files What After the Bill

Currently, small companies and One Person Companies file the simplified annual return in Form MGT‑7A, while all other companies file the comprehensive Form MGT‑7. The raised small-company thresholds will shift a significant number of companies from the MGT‑7 column to the MGT‑7A column. The practical implications include:

• Reduced disclosure burden. MGT‑7A requires fewer data fields, no detailed shareholding pattern beyond promoter categories, no indebtedness tables, and a simplified directors’ details section.
• Lower professional costs. Companies newly eligible for MGT‑7A may negotiate reduced fees for annual-return preparation and company-secretary certification.
• Transition-year care. For the financial year in which reclassification takes effect, practitioners should file using the form applicable to the company’s status at the relevant date. Confirm with the MCA’s guidance on transitional filing.

Annual Return Timelines and Late-Fee Exposure

The statutory deadline for filing annual returns remains within 60 days from the date of the AGM. However, the decriminalisation provisions change the consequence of late filing: instead of potential criminal prosecution, companies face civil penalties calculated on a per-day basis. Early indications suggest these penalties could be significant for prolonged delays, making timely filing as important as ever despite the softer enforcement mechanism.

Secretarial Audit Thresholds

Section 204 of the Companies Act mandates secretarial audits for listed companies and prescribed classes of unlisted companies (currently those with paid-up share capital of ₹50 crore or more, or turnover of ₹250 crore or more). If the Bill adjusts these thresholds, mid-sized companies currently subject to mandatory secretarial audit may find themselves exempt, or vice versa. Practitioners should monitor the final notified thresholds closely.

Step-by-Step ROC Filing Checklist

1. Verify reclassification. Check whether your company’s latest audited financials place it within the proposed small-company thresholds.
2. Determine the correct form. If reclassified as small, prepare to file MGT‑7A instead of MGT‑7 for the applicable financial year.
3. Update AOC‑4 annexures. Map your IEPF disclosures, buyback reporting and CSR annexures against the new requirements.
4. Recalculate secretarial-audit applicability. Determine whether you still require a secretarial audit under the revised thresholds.
5. Pass a board resolution. Record the board’s acknowledgement of the Bill’s proposals and authorise the company secretary to implement transitional compliance steps upon notification.
6. Monitor MCA notifications. Set up alerts for the official Gazette notification of commencement dates, since the Bill’s provisions come into force on “such date as the Central Government may, by notification, appoint.”
7. File on time. Regardless of the penalty framework changes, maintain existing filing deadlines to avoid exposure to per-day civil penalties.

Incorporation and SPICe+ Changes: What Promoters and Company Secretaries Must Do

The SPICe+ incorporation process, which consolidates name reservation, incorporation, DIN allotment, PAN/TAN and EPFO/ESIC registration into a single form, is not radically overhauled by the Bill. However, two areas create new action items for promoters and practitioners.

LLP conversion of trusts and unregistered bodies. The Bill’s LLP Act amendments open a new conversion pathway. Entities currently structured as private trusts or unregistered partnerships that wish to convert to an LLP will need to navigate a process that, while analogous to existing company-to-LLP conversions, will require fresh documentation including a statement of assets and liabilities, a conversion application form and revised partnership deeds. Practitioners should prepare template board and trustee resolutions in anticipation.

IFSC incorporations. For companies being incorporated within the IFSC regime, the Bill’s foreign-currency denomination carve-out means that the Memorandum and Articles of Association may now state authorised and paid-up share capital in a foreign currency (USD, for instance). SPICe+ form fields and MCA backend systems will need to accommodate this, and until MCA issues technical guidance, promoters should include both INR-equivalent and foreign-currency figures in their founding documents as a precautionary measure.

Practical step list for new incorporations:

• For standard domestic companies: no immediate SPICe+ process change, but verify small-company classification at the outset to determine future filing obligations.
• For IFSC companies: prepare dual-currency MOA/AOA drafts and await MCA’s technical circular on SPICe+ form updates.
• For trust-to-LLP conversions: compile asset/liability statements, obtain trustee and beneficiary consents, and draft the proposed LLP agreement before the conversion window opens upon notification.

Compliance Timeline and Transitional Provisions

Perhaps the most common question from practitioners is: when do these companies act amendments 2026 actually take effect? The answer depends on parliamentary progress and executive notification.

The Bill’s commencement clause states that provisions will come into force on “such date as the Central Government may, by notification in the Official Gazette, appoint; and different dates may be appointed for different provisions.” This means provisions could be phased in over months or even years.

If referred to a Joint Parliamentary Committee: passage may be delayed by several months. Companies should not defer compliance planning on the assumption that the Bill will stall, prepare now and adjust timelines if necessary.

Recommended immediate steps:

• Conduct a gap analysis against the Bill’s proposals using the comparison table above.
• Convene a board meeting to note the Bill and authorise the company secretary to take preparatory steps.
• Engage the company’s statutory auditors and practising company secretary to assess financial-statement and annual-return impacts.

Risk Areas, Traps and Practical Mitigation

Even well-managed companies can be caught off guard during a transitional compliance period. The following six risk areas deserve particular attention as the corporate laws amendment bill moves toward enactment.

• Premature reclassification. Filing MGT‑7A before the new small-company thresholds are officially notified could result in a defective filing. Mitigation: Wait for the Gazette notification before switching forms; if in doubt, file the more comprehensive MGT‑7.
• Late-fee miscalculation. The shift from criminal to civil penalties does not eliminate financial exposure. Per-day penalty calculations can accumulate rapidly. Mitigation: Maintain a filing-deadline calendar and escalation protocol.
• CSR threshold recalibration. Changes to the small-company definition may affect CSR applicability (Section 135 thresholds are independent but interact with overall compliance planning). Mitigation: Recalculate CSR obligations using both current and proposed definitions; set aside provisions for the higher amount until clarity emerges.
• IEPF transfer errors. Amended transfer timelines may create confusion during the transition year. Mitigation: Maintain a detailed register of unclaimed dividends and shares, with trigger dates mapped against both current and proposed timelines.
• Buyback compliance gaps. Companies with ongoing or planned buyback programmes must ensure board resolutions and shareholder approvals reference the correct statutory provisions. Mitigation: Draft buyback resolutions with a “subject to such amendments as may be notified” clause.
• Board-minute deficiencies. Regulators may scrutinise whether the board demonstrated awareness of pending legislative changes. Mitigation: Include a standing agenda item in board meetings to note legislative developments. Sample wording: “The Board noted the introduction of the Corporate Laws (Amendment) Bill, 2026 in Lok Sabha and authorised the Company Secretary to monitor its progress and take preparatory compliance steps as may be required upon notification.”

Downloadable ROC Filing Checklist and Templates

To support compliance teams in preparing for the transition, the following resources are recommended for assembly and internal distribution:

• AOC‑4 annexure mapping worksheet, a spreadsheet mapping each AOC‑4 attachment to the relevant Companies Act section and flagging which sections are amended by the Bill.
• MGT‑7A sample table of contents, a template showing the data fields required in the simplified annual return, with annotations on what changes under the proposed thresholds.
• Board resolution template, sample wording for the board to note the Bill and authorise preparatory compliance steps (see the sample language in the risk-mitigation section above).
• Filing-deadline calendar, a 12-month calendar with AGM deadlines, ROC filing windows and penalty trigger dates, configurable for both current and proposed regimes.

Practitioners who require tailored versions of these documents for specific company types (IFSC entities, startups, or OPCs) should consult with a qualified company-law practitioner through the Global Law Experts lawyer directory.

Conclusion and Next Steps

The Corporate Laws (Amendment) Bill represents the most significant proposed overhaul of India’s corporate-law framework since the 2020 decriminalisation amendments. Whether your company is a Delhi-based IT services firm verifying its small-company eligibility, a Mumbai manufacturer recalibrating IEPF disclosures, or a GIFT City IFSC entity preparing foreign-currency incorporation documents, the time to begin compliance planning is now, not upon notification. Companies that complete their gap analysis, update ROC filing templates and pass preparatory board resolutions today will transition smoothly when the Gazette notifications arrive.

For jurisdiction-specific guidance on how these changes affect your company’s ROC filings, secretarial-audit obligations or restructuring plans, connect with a qualified Indian company-law practitioner through the Global Law Experts network. For general enquiries about our coverage of Indian corporate-law developments, visit the About Global Law Experts page or contact us directly.

Sources

1. PRS India, Bill Tracker: The Corporate Laws (Amendment) Bill, 2026
2. eGazette, Corporate Laws (Amendment) Bill notification text
3. EY Regulatory Alert, Corporate Laws Amendment Bill 2026
4. Cyril Amarchand Mangaldas, Client Alert
5. Vinod Kothari Consultants, Bill Summary
6. ICSI, Solicit Suggestions on The Corporate Laws (Amendment) Bill 2026
7. AZB & Partners, Corporate Laws (Amendment) Bill 2026 Introduced
8. Taxmann, Government Introduces Corporate Laws (Amendment) Bill 2026