On 3-11-2025, the Ministry of Corporate Affairs notified the Companies (Meetings of Board and its Powers) Amendment Rules, 2025 to amend the Companies (Meetings of Board and its Powers) Rules, 2014. The provisions came into force on 3-11-2025.
Key Amendment:
The Companies (Meetings of Board and its Powers) Amendment Rules, 2025 amended Rule 11 relating to “Loan and investment by a company under Section 186 of the Act”.
Through this amendment, the scope of the expression “business of financing industrial enterprises” has been modified:
Earlier, with regard to a Non-Banking Financial Company registered with the Reserve Bank of India, it meant “business of giving of any loan to a person or providing any guaranty or security for due repayment of any loan availed by any person in the ordinary course of its business”.
Now, for:
-
TheNon-Banking Financial Company registered with the Reserve Bank of India, the expression “business of financing industrial enterprises” will include the business of giving loans or providing guarantees or security for repayment of loans as part of its regular business activities.
-
The Finance Company registered with the International Financial Services Centres Authority, the expression will include the activities as provided in Regulation 5(1)(ii)(a) or Regulation 5(1)(ii)(e) of the International Financial Services Centres Authority (Finance Company) Regulations, 2021 in the ordinary course of its business.
Note: Regulation 5 of International Financial Services Centres Authority (Finance Company) Regulations, 2021 relate to “Permissible activities”.
-
Regulation 5(1)(ii)(a)- Permitted Core Activities- Lend in the form of loans, commitments and guarantees, credit enhancement, securitization, financial lease, and sale and purchase of portfolios.
-
Regulation 5(1)(ii)(e)- Permitted Core Activities- Global/Regional Corporate Treasury Centres.