Corporate Laws, Joint Ventures, Corporate Compliances, Foreign Direct Investments, Structuring Stock Options, Negotiating and Structuring Contracts, Private Equity, Mergers and Acquisitions.
The Companies Act is an Act of the Parliament of India, which enabled companies to be formed by registration, and set out the responsibilities of companies, their directors and secretaries. Chennai Lawyers is a leading Corporate Law Firm in India. The Companies Act is administered by the Government of India through the Ministry of Corporate Affairs and the Offices of Registrar of Companies, Official Liquidators, Public Trustee, Company Law Board, Director of Inspection, etc. The Registrar of Companies (ROC) handles incorporation of new companies and the administration of running companies. Since its commencement, it has been amended many times, in which amendment of 1988, 1990, 1996, 2000, 2011 and 2013 are notable.- Wikipedia
A joint venture (JV) is a business agreement in which the parties agree to develop, for a finite time, a new entity and new assets by contributing equity. They exercise control over the enterprise and consequently share revenues, expenses and assets. We will help you in identifying and structuring the strategic Joint Venture deals. We also facilitate negotiating and finalizing the deal.
Corporate compliance is an important aspect for any company. No company can afford to take this lightly. Good corporate governance reduces risk and leads to higher profits and higher valuation of Company. A good Corporate governance will make your company different and lead it towards Excellence. Today, in India, the corporate sector is governed by a complex web of laws, rules and regulations viz. Companies Law, Competition Law, Economic Laws, Securities and Capital Market Laws, Consumer Protection Laws, Industrial and Labour Laws, Pollution Control Laws, Foreign Exchange Legislation, Money Laundering Laws apart from being subject to Civil and Criminal Laws of the Land.
The main advantages of Corporate Compliance are
- Easy quantification of risk
- Establishing risk appetite
- Building strong foundation
- Extending confidence to Investors
- Identify and prioritize controls
- If the property is sold for the first time, a no objection certificate is required ID proof of both the parties
- Gaining competitive edge
Foreign Direct Investment (FDI)
FDI is a controlling ownership in a business enterprise in one country by an entity based in another country. Foreign direct investment is distinguished from Portfolio investment, which is a passive investment in securities of another country such as stocks, bonds, etc. The origin of the investment does not impact the definition as an FDI, i.e., the investment may be made either inorganically by buying a company in the target country or organically by expanding operations of an existing business in that country. The different forms in which business can be conducted by a foreign company in India are :
1) By Incorporating a company under the Companies Act as a joint venture or a wholly owned subsidiary
2) Set up a Liaison Office / Representative Office or a Project Office or a Branch Office of the foreign company which can undertake activities permitted under the Foreign Exchange Management (Establishment in India of Branch Office or Other Place of Business) Regulations, 2000.
The procedure for receiving Foreign Direct Investment in an Indian company are mainly by two routes
1) Automatic Route - FDI is allowed under the automatic route without prior approval either of the Government or the Reserve Bank of India in all activities/sectors as specified in the consolidated FDI Policy, issued by the Government of India from time to time.
2) Government Route - FDI in activities not covered under the automatic route requires prior approval of the Government which are considered by the Foreign Investment Promotion Board (FIPB), Department of Economic Affairs, Ministry of Finance. Application can be made in Form FC-IL, which can be downloaded from http://www.dipp.gov.in. Plain paper applications carrying all relevant details are also accepted. No fee is payable. The Indian company having received FDI either under the Automatic route or the Government route is required to comply with provisions of the FDI policy including reporting the FDI to the Reserve Bank of India.
The various modes of payment for shares and/or debentures allowed for receiving Foreign Direct Investment in an Indian company are.
1) Inward remittance through normal banking channels.
2) Debit to NRE / FCNR account of a person concerned maintained with an AD category I bank.
3) conversion of royalty / lump sum / technical know how fee due for payment or conversion of ECB, shall be treated as consideration for issue of shares.
4) conversion of import payables / pre incorporation expenses / share swap can be treated as consideration for issue of shares with the approval of FIPB.
5) debit to non-interest bearing Escrow account in Indian Rupees in India which is opened with the approval from AD Category, I bank and is maintained with the AD Category I bank on behalf of residents and non-residents towards payment of share purchase consideration.
The Employees Stock Option Plan (ESOP)
Employees are the vital assets to any company. Managing your key employees is an art. Loosing a Key employee may be costly. The kind of employee ownership plan they want to use is usually based on specific needs and goals. However, sometimes they might be better served by another kind of stock plan. Many say they'd like to have an employee ownership plan, but they're not sure what it might be. We will start you down the path to choosing and implementing the plan or plans best suited to your company. While designing the compensation arrangements it should be ensured that there is a proper balance between fixed pay and variable pay. However, variable pay should not exceed 70% of the fixed pay in a year. Within this ceiling, at higher levels of responsibility the proportion of variable pay should be higher. The variable pay could be in cash, or stock linked instruments or mix of both. The Employees Stock Option Plan (ESOP) prevalent in India, may be excluded from the components of variable pay. The deterioration in the financial performance of the bank should generally lead to a contraction in the total amount of variable remuneration paid.
Where the variable pay constitutes a substantial portion of the fixed pay, say 50% or more, an appropriate portion of the variable pay, say 40% to 60% must be deferred for over a period. The bank may define what is substantial in its compensation policy. There should be proper balance between the cash and stock / share components (other than ESOP) in the variable pay in case the variable compensation contains stock or share linked instruments (other than ESOP).
ESOP is kept outside the computation of the total compensation of an employee for the purpose of this guideline, but since it is used as a compensation as well as retention tool by banks, the extent of ESOP should be reasonable. However, norms for grant of ESOP should be framed by banks in conformity with relevant statutory provisions and SEBI guidelines, and should form part of the bank's compensation policy. The details of ESOP granted should also be disclosed in terms of the disclosure requirements stipulated in this guideline.
Negotiating and Structuring Contracts
Contract Negotiation is an important step in finalization of a deal. Most of the Business success is measured by the closure of the deals. Structuring and Finalization of Contracts is an important step. With so many ways to interpret (or misinterpret) contracts, it's easy for a business to get into unforeseen predicaments. When it comes to contract negotiations, many businesses have fallen victim to a lack of clarity resulting from contractual inaccuracies.
As a professional with lots of experience in deal closure we are having an efficient process for structuring and negotiating the deals and more importantly the softer skills of negotiations. The attorneys at Chennai Lawyers are skilled contract negotiators with vast experience in crafting contracts for their clients. Our contract negotiation lawyers have a knack for facilitating agreements between parties with diverse interests. Complex business structures require lawyers who are adept at preventing future headaches and disputes. By effectively managing client expectations, our lawyers minimize future unexpected and unwelcome debates.
Clients appreciate Chennai Lawyers for providing sound advice and logical, pragmatic solutions for their business contract needs. However, in the event a dispute should arise, the tenacious contract negotiation attorneys at the firm are well-versed in successfully resolving their clients issues. Companies of all sizes and from around the country have been relying on Chennai Lawyers for legal know-how in the business arena, including some of the highest-profile organizations. From local, family owned shops to mega-media conglomerates, the firm has proven time and again that its lawyers are proficient in protecting their clients rights. For the legal team that is highly proficient in contract negotiations, contact Chennai Lawyers.
Mergers and Acquisitions
We guide companies through even the most complex mergers, acquisitions, and divestitures. Our broad expertise includes strategy development, due diligence, pre-merger planning, post-merger integration, spin-offs, and carve outs. We help our clients capture maximum value from their deals in both immediate returns and longer-term competitive advantage.
We focus on niche areas in which we provide significant value and are invariably involved in select highly complex, innovative transactions. Our experience with legal, coupled with industry expertise in an integrated manner allows us to provide the complete strategy from the onset through to the full set up of the business and until the exits.