On 23 March 2026, the Corporate Laws (Amendment) Bill, 2026 (Bill) was introduced in the Lok Sabha to amend the Companies Act, 2013 (Companies Act) and the Limited Liability Partnership Act, 2008 (LLP Act) with the primary objective of streamlining existing practices, recognizing new concepts amid evolving business landscape and decriminalizing certain offences. The key amendments to the Bill have been summarized in a two-part series. In this 1st part, we have set out governance-related key amendments under the Companies Act.
| Subject | Summary of the Amendment |
| Directors | An additional director may hold office up to the date of next general meeting or 3 months, whichever is earlier. Similarly, a director appointed to fill a casual vacancy may hold office up to next general meeting or 3 months, whichever is earlier. |
| Disqualification of directors | A person will be disqualified from being appointed / acting as a director if: a. he has been an auditor, a registered valuer or an insolvency professional of the company or its holding, subsidiary or associate during the immediately preceding 3 financial years or during the current financial year; b. he does not meet the “fit and proper person” criteria (as may be prescribed by the rules); c. the appointee company has failed to file its financial statements or annual returns for the last 2 financial years (as opposed to 3 financial years presently). Further, the restriction in respect of appointment or association of an independent director in any other capacity during the cooling off period of 3 years after 2 terms of 5 years each is applicable to the company as well as its holding, subsidiary or associate company. |
| Disclosure of interest | Directors will no longer be required to make a disclosure of interest at the first board meeting of every financial year; change-based disclosures will suffice. |
| Shareholder meetings | a. Companies may conduct annual general meetings and extraordinary general meetings via video conferencing or in hybrid mode. However, companies must conduct a physical annual general meeting at least once every 3 years. b. Where the general meeting is to be conducted wholly through video conferencing / audio-visual means, the notice period for calling such meeting is proposed to be reduced to 7 days (as opposed to the general duration of 21 days currently). |
| Corporate social responsibility (CSR) | The applicability threshold for provisions related to CSR has been enhanced from INR 5 crores to INR 10 crores. Where a company’s CSR obligation does not exceed INR 1 crore (up from INR 50 lakhs), it will be exempt from constituting a CSR committee and the board of directors will discharge the functions of the CSR committee. |