Real Estate: Requirement of the built up area and capital conditions for FDI is being reduced from 50,000 square meters to 20,000 square meters and minimum investment from USD 10 million to USD 5 million respectively with a three year post completion lock in.Projects which commit at least 30 per cent of the total project cost for low cost affordable housing will be exempted from minimum built up area and capitalization requirements, with the condition of three year lock-in.

Insurance and Defense Sector cap of foreign investment is being raised to 49 per cent from current 26 per cent with full Indian management and control through the FIPB (Foreign Investment Promotion Board) route.

The government has extended the incentives of a reduction of two percentage-points in excise duty on capital goods and consumer durables and between three and six percentage points on automobiles till Dec. 31.

Section 143(3)(i) of the Companies Act 2013 requires the auditors of the companies to report as whether the company has adequate internal financial controls system in place and the operating effectiveness of such controls. The Council also decided that as a corollary, the provisions of section 143(3)(i) of the Companies Act 2013 would apply to the audits of the financial year beginning on or after 1st April 2014.

Section 143(12) of the Companies Act 2013 requires the auditors of the companies to report to the Central Government on the frauds committed or being committed against the company. The requirements of these sections and related Rules would not apply to audits of financial statements of the periods beginning on or before 31st March 2014, even if the audits therefor were actually carried out and auditor’s report thereon issued on or after 1st April 2014. The Council, accordingly, felt that prima facie, as a corollary, section 143(12) would become applicable only for financial year (and not for a period) 2014-2015 and on wards. The ICAI Council is, however, in the process of communicating with the Ministry of Corporate Affairs in this regard.

Foreign entities acting as research analysts for Indian markets or India-listed companies would need to tie-up with a registered entity in India, while domestic players will also be subjected to strict disclosures and scrutiny. Entity would need to get registered after meeting the prescribed criteria regarding qualifications, capital adequacy, establishment of internal policies and procedures, firewalls against conflict of interest, sufficient & timely disclosures, among others. The final norms in this regard would be notified soon.

The Securities and Exchange Board of India (SEBI) decided that all companies with a post- issue capital above ` 4,000 crore to offer at least 10% stake in the IPO. SEBI has also decided to raise anchor investor’s bucket to 60% from the current requirement of 30% of the institutional bucket. Moreover, the board approved the proposal “to permit bonus shares issued in last one year prior to filing of the draft offer document to be offered for sale, provided that these bonus shares were issued out of the free reserves or share premium”.

Market regulator Securities & Exchange Board of India (SEBI) has tweaked the pricing formula for ‘preferential issues’ with the intent of using a more representative price in such share sales. Henceforth, ‘volume weighted average price’ (VWAP) would be used as a parameter for pricing the preferential issues as against the current requirement of using the ‘closing price’.