India is firming up an overhaul of its corporate compliance rulebook that will make it quicker to register a company—possibly within hours—and easier to shut one that’s not working out, while cutting the paperwork in between, according to two people and an official document reviewed by Mint. The corporate affairs ministry is drawing up a reform blueprint that will also include use of artificial intelligence and greater automation to speed up scrutiny and filings, the officials said.
The aim is to bring more ease to doing business in India to help the country achieve its developed by 2047.
Under the planned reforms playbook, the corporate affairs ministry is also examining the feasibility of tying some compliance obligations to the size, sector, and risk profile of firms, to ensure smaller unlisted entities are not disproportionately burdened, said the two people cited earlier.
Despite recent improvements, company incorporations often take 10-15 days, while voluntary closure applications get processed in about two months, analysts say.
The corporate affairs ministry, through the Indian Institute of Corporate Affairs, has held consultations on five ‘core reform themes’ relating to the compliance architecture under the Companies Act, said the people cited above.
These themes are: platform excellence, or elevating the performance of the corporate affairs ministry’s MCA21 portal for corporate filing to the highest global standards; technology-enabled compliances; intelligent interoperability and seamless data-sharing across platforms; rationalization of forms; and inclusive and proportionate design with calibrated compliance norms, depending on companies’ size and risk profile, they said.
Queries on the proposed reforms emailed to the corporate affairs ministry remained unanswered until press time.
Fresh push
The latest exercise will look to build on the eased compliance burden proposed in the Corporate Laws (Amendment) Bill, 2026, which was, and then referred to a joint parliamentary committee for vetting.
The bill proposes to decriminalize civil offences pertaining to compliances across about two dozen provisions of existing laws governing companies and limited liability partnerships (LLPs).
It has also proposed exemption from mandatory corporate social responsibility (CSR) and auditor appointment requirements for select classes of companies, among other provisions. The parliament panel submitted its report last month, which is being examined by the corporate affairs ministry.
As for the latest consultations, they seek to view reform opportunities through the prism of practitioners, as much as the regulators, said the people in the know.
Most of these compliance reforms may be part of the rules and regulations that don’t require parliamentary approval to be implemented, analysts said.
The proposals aim to bolster compliance workflows, expand automatic approvals through the so-called straight-through process (STP) and unlock automation potential via intelligent system integration, pre-filling, and reuse of corporate registry data.
“The consultation exercise aims to ensure inclusive, evidence-based reform that reflects the lived experience of businesses, professionals, and regulators,” said one of the two people cited earlier.
The ministry will finalize its recommendations on the reform blueprint after factoring in stakeholder view from the consultations.
Among the focus areas is bolstering of the MCA21 portal, which is used by companies for various filings and acts as a corporate data repository. The latest version of the portal, the V3, has attracted frequent criticism over technical glitches since its introduction in 2023.
As for automatic approvals, about 80 forms on various filings are currently handled on the STP (straight through process) or conditional STP basis on the MCA21 portal, allowing acceptance of forms electronically without human intervention. This could be significantly expanded as part of the planned reforms.
Implementation is key
“If implemented successfully, the latest plan could ease the compliance burden felt by companies, especially MSMEs (micro, small and medium enterprises), which often struggle with procedural complexity,” said Shankey Agrawal, partner at BMR Legal.
Indian companies with overlapping forms and tedious manual filing under the Companies Act, which weigh on their compliance efforts, said Agrawal.
The latest MCA21 version signalled the government’s bid to streamline and automate the approval process, and the proposed reforms would be “a major leap towards making corporate compliance simpler and more efficient”, he added.
“The proposed rationalization of the filing framework will significantly cut duplication and manual intervention in routine filings,” said Manmeet Kaur, partner at legal and consultancy firm Karanjawala & Co.
Further form consolidation and the STP expansion would come in handy, she said.
“That being said, the success of this exercise will depend on how well the system handles cases and unusual filings that don’t fit neatly into pre-filled templates,” Kaur added.