The Ministry of Corporate Affairs (MCA), vide two notifications issued on 20 January 2018, revised the Companies (Incorporation) Rules, 2014 and the Companies (Registration Offices and Fees) Rules, 2014 (together, “Amendments”). The Amendments, effective from 26 January 2018, revise the procedure in relation to incorporation of a company in India and the associated fee. The Amendments further promote India’s continuing efforts in Ease of Doing Business as the revised process is intended to be simpler and quicker.
Key features of the Amendments are as follows:
- Zero fee for incorporation of companies: No incorporation fee shall be payable for companies incorporated with effect from the 26 January 2018:
- with a nominal capital up to INR 1,000,000 (Rupees one million); or
- without having share capital and whose number of members does not exceed 20 (twenty).
- Reserve Unique Name (RUN) facility: The MCA introduced RUN, a web service accessible at mca.gov.in to facilitate making application for name reservation. It is important to note that no re-submission of the application is allowed in case of reservation of a name through RUN.
Further, in relation to incorporation of a company, if pursuing of any of the objects of a company requires registration or approval from sectoral regulators such as the Reserve Bank of India, the Securities and Exchange Board of India, then such registration or approval, as the case may be, from such regulator would have to be obtained by the proposed company before pursuing such objects and a declaration in this behalf would need to be submitted at the stage of incorporation of such company.
Accordingly, the MCA has introduced a form for RUN and has revised various e-forms associated with incorporation of a company.
The full text of the Amendments can be accessed at: