What Changes Are Coming with the Corporate Laws (Amendment) Bill, 2026? Insights from the Lok Sabha Debate

The Lok Sabha has approved the Corporate Laws (Amendment) Bill, 2026, for review by the Joint Parliamentary Committee. Introduced by Finance Minister Nirmala Sitharaman, the Bill aims to amend existing laws to enhance the ease of doing business, decriminalize minor offenses, and reduce compliance burdens for small firms and startups. Despite opposition concerns regarding Corporate Social Responsibility, the Finance Minister assures that the amendments will attract investments and improve corporate governance. This legislation follows extensive consultations with industry experts and stakeholders, reflecting a significant step towards regulatory reform in India.

By Narendra Chaudhary Mar 23, 2026, 15:35 IST

Lok Sabha Approves Corporate Laws Amendment Bill for Further Review

New Delhi: On Monday, the Lok Sabha granted its endorsement to send the Corporate Laws (Amendment) Bill, 2026, to the Joint Parliamentary Committee (JPC) for in-depth examination.

Finance Minister Nirmala Sitharaman presented the Bill, which seeks to modify the Limited Liability Partnership Act of 2008 and the Companies Act of 2013, and suggested its referral to the JPC for comprehensive review.

The primary goal of this Bill is to enhance the business environment by decriminalizing minor infractions, substituting certain criminal penalties with civil fines, and easing compliance requirements for small businesses, startups, and agricultural enterprises.

Opposition members, including Congress's Manish Tewari, Trinamool Congress's Sougata Ray, and DMK's Dr. T. Sumathy, voiced their objections to the Bill's introduction.

They claimed that the legislation undermines Corporate Social Responsibility provisions. In response, the Finance Minister assured that the amendments would not only draw in more investments but also improve corporate governance.

Sitharaman emphasized that this legislation is the result of two years of thorough discussions. She noted that input from industry representatives, professional organizations, legal and accounting experts, and the public was gathered and analyzed prior to the Bill's introduction.

The proposed amendments stem from recommendations made by the Company Law Committee (CLC), established by the government to promote a more business-friendly environment. This 11-member committee was formed in September 2019 and included notable figures such as former Lok Sabha Secretary General T.K. Viswanathan and Kotak Mahindra Bank's Managing Director Uday Kotak.

The CLC submitted its final report to the government on March 21, 2022.

The CLC's recommendations were discussed among various stakeholders and reviewed by the High-Level Committee on Non-Financial Regulatory Reforms (HLC-NFRR), led by former Cabinet Secretary and NITI Aayog member Rajiv Gauba.

During her budget address for 2025-26, the Finance Minister announced the formation of this committee, stating, 'A High-Level Committee for Regulatory Reforms will be established to review all non-financial sector regulations, certifications, licenses, and permissions.'