The Ministry of Corporate Affairs (MCA) notified the commencement of section 10 of the Companies (Amendment) Act, 2017, on 7 August 2018. Section 10 amends and replaces the former section 42 of the Companies Act, 2013 (CA), which governs the issue and allotment of securities on a private placement procedure basis. The MCA simultaneously notified the Companies (Prospectus and Allotment of Securities) Second Amendment Rules, 2018, amending the principal rules corresponding to section 42 of the CA.
The significant amendments made to the private placement procedure are as follows:
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