MCA-21&INVESTORS;PROTECTION

The tremendous growth of the Indian companies remains reckoning in today’s globally competitive environment forced to take new initiative namely electronic administration in corporate sector.

    MCA-21portal is visualized to make available anytime and anywhere services to business and investors.

    Builds on Government of India vision to bring in a service oriented approach in the design and delivery of government services establish a healthy company eco-system and make the country globally competitive and aggressive.

VISION OF MCA-21

v     To be a leader and partner initiatives of corporate reforms among good corporate governance and enlightened regulation with a view to promote and facilitate effective corporate and investor protection.

SCOPE OF MCA-21

   Provide for anytime and anywhere electronic services with speed and certainty to the stakeholders.

     Designed to automate the process related to the proactive enforcement and compliance of legal requirements under the companies act, 1956.

 To ensure quality service the government will  take the following steps:

1. Establishment of robust and scalable infrastructure for 24*7 reliable accesses from anywhere;

2. Digitization of about six crore sheets of documents including Memorandum and Articles of Association;

3. Making Digital Signature Certificates (DSCs) mandatory to ensure authenticity and maximum security of documents;

4. Introduction of electronic payment mechanism;

5. Establishment of facilitation centers to support those needing assistance in

E-Filing;

6. Creation of a new set of revamped e-Forms leading to reduction in total number of forms besides elimination of repetitive data;

7. Collection of stamp duty in due course of time subject to authorization from respective state governments, eliminating use of physical stamp papers.

 KEY BENEFITS OF MCA-21                                          

(i)Prompt incorporation of companies.

(ii)Simplified and ease of convenience in filing of forms and returns.

(iii)Better compliance management.

(iv)Transparency through e-governance.

(v)Customer centric approach.

(vi)Building up a centralized database storehouse of corporate operations.

(vii)Inspection of public documents of companies anytime from anywhere.

(viii)Timely redressal of Investor grievances.

 INFORMATION TECHNOLOGY AND STOCK MARKET

    New financial products and

     Changing market designs

     Improved computer and telecommunication technology have led to dramatic and

v     Rapid changes in the structure of financial markets and institution.

v     Technology has erased the geographical boundaries even creating new alternatives

   Technology led to a paradigm shift and revolutionized the structure and the functions of the securities market.

  Squash the disagreement trading system    Online trading from 364 cities

JOSEPH GRUNDFEST of Standard Law School had aptly said that “The securities industry is, in many essential respects an information processing industry

A typical investor will require a few or all of the following:    

Confidence

Ability to trade,

An efficient and comprehensive settlement.

 Protection of investors

INVESTOR PROTECTION

    SEBI – Twin functions

    Regulatory

To protect the interests of investors

To regulate the Securities Markets

    Developmental

To promote the development of Securities Markets

Governing Legislations

The functions of SEBI flow from the following legislations:

    SEBI Act, 1992

    Companies Act, 1956

    Securities Contracts (Regulation) Act, 1956

    Depositories Act, 1996

   Rules, Regulations Guidelines and Circulars.

CAUTION TO THE INVESTORS

    Empower yourself through information.

    Investing is a serious business.

    Be informed about the risks and rewards of products/mechanisms before investing. This understanding would facilitate prudent decision making at your end.

    Just don’t buy a paper; take stake in an organization. Endow with the required information before initiating this relationship.

   Seek advice from an expert, if required, before committing any position in the market.

    Read documents and understand the implications before entering in to contracts, with various intermediaries in the market and issuers.

   Deal with only the SEBI registered intermediaries. Know the intermediary, his history, potential to deliver etc. before entering into relationship. Don’t get carried away just by the charges.

   Don’t be carried away by the influence of the broker/selling agent. Take decisions independently and gradually based on the information. Be doubly sure about the appropriateness of the product/ products/ contracts etc before investing.

 In a nutshell, The advantages of MCA-21initiatives are speed in processing of applications, easier payment mechanism, certainty in delivery, ensuring pro-active and effective Compliance of relevant laws and corporate governance, easy access to relevant records and redressal of grievances, etc,