Lex Knowledge (April)

2nd April 2020

Ministry of Corporate Affairs, New Delhi (“MCA”) has issued advisory to all the companies and LLPs on preventive
measures to contain the spread of COVID-19 (Coronavirus).

Key highlights of the advisory:

(a) Social distancing:

As per the WHO, the COVID-19 situation has been declared a Pandemic. The disease has not only caused human suffering but has also led to major economic disruptions. In order to deal with the situation, MCA has advised and required the Corporate Sector to play a major role in implementing the strategic policy decision of social distancing,
which is most crucial for reducing the rate and extent of the COVID-19 disease transmission at community level.

The MCA has strongly advised all the companies/LLPs to come up with an immediate plan to implement the policy of “Work From Home” as a temporary measure till 31 st March, 2020, after which the situation will be reviewed by the appropriate authorities as the evolving circumstances. Till 31 st March, 2020 the MCA has advised all the
companies/LLPs to implement the said “Work From Home” policy in their headquarters and field offices to the maximum extent possible, including by conduct of meetings through video conference or other electronic/telephonic/computerized means. Moreover, even when the essential staff are on their duty, staggered timings may be followed so as to minimize physical interaction.

The MCA also urged all the companies/LLPs to strictly follow all the preventive measures, including ‘Dos & Don’ts’ advised by public health authorities.

(b) Relaxation of rules regarding board meetings:

The MCA has also relaxed the rules regarding meeting of Board and has dispensed with the necessity of holding physical meetings on matters relating to approval of financial statements, board report, restructuring etc. upto 30 th June, 2020. The MCA is reviewing other areas as well where relaxation may be provided in the wake of COVID- 19.

(c) Company Affirmation of Readiness towards COVID-19 (CAR):

With an aim to generate greater awareness and confidence on its state of readiness, the MCA is further in the process of developing and deploying a simple web form for all companies/LLPs to confirm their readiness to deal with the COVID-19 threat. The said form named as CAR (Company Affirmation of Readiness towards COVID-19) shall be
deployed on 23 rd March, 2020 with minimum fields, which can be filed from anywhere. There is no requirement of DSC and does not involve payment of any fee. Companies / LLPs may submit it at the earliest, but not later than 30th March 2020.

(d) Participation and cooperation of Companies/LLPs:

The MCA has further urged the companies/LLPs to fully participate and cooperate in realizing the objective of social distancing as a means to contain the spread, morbidity and mortality due to COVID-19.

Disclaimer – While we have taken reasonable care while preparing this newsletter, we accept no responsibility for any error that it may contain, or for any loss or damage, however caused, to anyperson that relies on it. Readers are specifically advised to seek professional advice before taking
any action on the basis of this newsletter.

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