The Ministry of Corporate Affairs is set to scrutinize large, unlisted startups, including Byju’s, Paytm Payments Bank, and BharatPe, in response to recent regulatory issues. The Company Law Committee, appointed by the government, is expected to finalize a regulatory framework for these startups within the next two months.
The committee’s focus is on startups not directly regulated by the Reserve Bank of India (RBI) or the Securities and Exchange Board of India (SEBI). This move is part of the government’s efforts to support startup growth while addressing regulatory and corporate governance challenges.
The committee, chaired by the corporate affairs secretary, consists of government officials, industry representatives, and experts. It aims to implement the Companies Act, 2013, and the Limited Liability Partnership (LLP) Act, 2008 effectively, while ensuring ease of doing business.
Recent actions include ongoing inspections against Byju’s and a notice sent to BharatPe seeking details on findings from a Delhi Police Economic Offences wing report. Regarding Paytm Payments Bank, the Ministry of Corporate Affairs will investigate if contacted by the RBI.
The committee is also reviewing norms and provisions for investors and board directors to enhance control without imposing undue regulatory burdens.
