Registrar of Companies (ROCs) to focus more on compliance as part of MCA reforms
The Registrars of Companies (ROCs) will sharpen their oversight and enforcement efforts against company law violators as ongoing reforms to cut red tape free them from routine work. India’s 25 ROCs oversee registrations of companies and limited liability partnerships (LLPs), ensuring these entities follow the law. The ministry of corporate affairs is rolling out reforms that have two key parts: one is replacing RoC approvals with straight-through processing (STP), requiring companies to only obtain an online acknowledgement of their statutory filings to be considered compliant.
The second is to create a centralized data processing centre to swiftly process forms filed by companies with field offices. “Once the new data centre is set up, forms filed by businesses will not go to RoCs but will be handled directly at the centralized facility. This and the other changes mean that the ROCs will be freed from routine work and can focus more on enforcement-related work.
Further, once version three of the government’s statutory filing portal MCA21 is fully rolled out later this year, 95% of the ROC work relating to statutory forms will be fully automated. In the recent past, ROCs have cracked down on entities registered as Nidhi companies—non-bank firms that lend and borrow within their members—but engaged in unauthorized lending operations and on entities that resort to crowd-funding of equity, which is not allowed. There are 1.5 million active companies and close to 300,000 active LLPs in the country.
