MCA UPDATES
MCA21 system will be
intermittently unavailable from Saturday, 09 Feburary 2019 10:00 PM to Sunday,
10th Feburary 2019 10.00 AM IST due to maintenance activity Stakeholders are
requested to plan accordingly.
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FORMAT FOR ANNUAL SECRETARIAL AUDIT REPORT AND ANNUAL SECRETARIAL
COMPLIANCE REPORT FOR LISTED ENTITIES AND THEIR MATERIAL SUBSIDIARIES
1. The Committee on Corporate Governance,
constituted under the Chairmanship of Shri Uday Kotak, in its report dated
October 05, 2017, recommended the following in view of the criticality of
secretarial functions to efficient board functioning
a. Secretarial audit to be made compulsory for
all listed entities under the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (“Regulations”) in line with the provisions of
the Companies Act, 2013.
b. Secretarial audit to be extended to all
material unlisted Indian subsidiaries in line with the recommendations of the
Committee on strengthening group oversight and improving compliance at a group
level for listed entities.
2. The aforesaid recommendations were accepted
and in order to implement the same, the
SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 have been amended to include the
following Regulation 24A:
“24A: Secretarial Audit
_Every listed entity and
its material unlisted subsidiaries incorporated in India shall undertake
secretarial audit and shall annex with its
annual report, a secretarial audit report, given by a company secretary
in practice, in such form as may be prescribed with effect from the year ended
March 31, 2019.”_
3. Accordingly, the following shall be complied
with by a listed entity and its material unlisted subsidiaries as applicable:
a. Annual secretarial audit report
(i) Currently, Section 204 of the Companies
Act, 2013 read with rule 9 of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014
requires Secretarial Audit
by Practicing Company Secretaries
(PCS) for listed
companies and certain unlisted companies above a certain
threshold in From No. MR-3.
(ii) In order to avoid duplication, the listed
entity and its unlisted material subsidiaries shall continue to use the same Form
No. MR-3 as required under Companies Act, 2013 and the rules made thereunder
for the purpose of compliance with Regulation 24A of SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015 as well.
b. Annual secretarial compliance report
(i) While the annual secretarial audit shall
cover a broad check on compliance with all laws applicable to the entity,
listed entities shall additionally, on an annual basis, require a check by the
PCS on compliance of all applicable SEBI Regulations and circulars/ guidelines
issued thereunder, consequent to which, the PCS shall submit a report to the
listed entity in the manner specified in this circular.
(ii) The format for the annual secretarial compliance
report is placed at Annex-A
(iii) The annual secretarial compliance report in
the aforesaid format shall be submitted by the listed entity to the stock
exchanges within 60 days of the end of the financial year.
c. The listed entities and their material
subsidiaries shall provide all such documents/information as may be sought by
the PCS for the purpose of providing a certification under the Regulations and
this circular.
4. ICSI may consider issuing a guidance note
to Practising Company Secretaries to enable them to undertake certifications in accordance
with the Regulations and this circular in letter and in spirit.
5. The Stock Exchanges are advised to bring
the provisions of this circular to notice of the listed entities and also to
disseminate on their websites.
6. This circular shall come into force as
under:
a. With respect to the annual secretarial
audit report, in the annual reports of the listed entities and the material
unlisted subsidiaries from the financial year ended March 31, 2019 onwards.
b. With respect to the annual secretarial
compliance report, applicable to listed entities, with effect from the
financial year ended March 31, 2019 onwards.
7. The circular is issued in exercise of the
powers conferred under sections 11 and 11A of the Securities and Exchange Board
of India Act, 1992 read with Regulations 24A and 101 of SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015.
8. The circular is available on SEBI website.
For Annexure – A visit
below link…
https://www.sebi.gov.in/legal/circulars/feb-2019/physical-settlement-of-stock-derivatives_42021.html
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COMPANIES (SIGNIFICANT BENEFICIAL OWNERSHIP) AMENDMENT RULES,
2019
In exercise of the powers
conferred by sub-sections (1) and (2) of section 469 read with section 90 of
the Companies Act, 2013 (18 of 2013), the Central Government hereby makes the
following rules further to amend the Companies (Significant Beneficial Owners)
Rules, 2018, namely:-
1. (1) These rules may be
called the Companies (Significant Beneficial Owners) Amendment Rules, 2019
(2) They shall come into
force on the date of their publication in the Official Gazette.
2. In the Companies
(Significant Beneficial Owners) Rules, 2018 (hereinafter referred to as the
principal rules), in rule 2, in sub-rule (1), for clauses (b) to (e), the
following clauses shall be substituted namely:-
(b) control means control
as defined in clause (27) of section 2 of the Act;
(c) form means the form
specified in Annexure to these rules;
(d) majority stake means
(i) holding more than
one-half of the equity share capital in the body corporate; or
(ii) holding more than
one-half of the voting rights in the body corporate; or
(iii) having the right to
receive or participate in more than one-half of the distributable dividend or
any other distribution by the body corporate;
(e) partnership entity
means a partnership firm registered under the Indian Partnership Act, 1932 (9
of 1932) or a limited liability partnership registered under the Limited
Liability Partnership Act, 2008 (6 of 2009);
(£) reporting company
means a company as defined in clause (20) of section 2 of the Act, required to
comply with the requirements of section 90 of the Act;
(g) section means a
section of the Act;
(h) significant beneficial
owner in relation to a reporting company means an individual referred to in
sub-section (1) of section 90, who acting alone or together, or through one or
more persons or trust, possesses one or more of the following rights or entitlements
in such reporting company, namely:-
(i) holds indirectly, or
together with any direct holdings, not less than ten per cent. of the shares
(ii) holds indirectly, or
together with any direct holdings, not less than ten per cent. of the voting rights
in the shares;
(iii) has right to receive
or participate in not less than ten per cent. of the total distributable
dividend, or any other distribution, in a financial year through indirect
holdings alone, or together with any direct holdings;
(iv) has right to
exercise, or actually exercises, significant influence or control, in any
mam1er other than through direct holdings alone:
Explanation I - For the
purpose of this clause, if an individual does not hold any right or entitlement
indirectly under sub-clauses (i), (ii) or (iii), he shall not be considered to
be a significant beneficial owner.
Explanation lI - For the
purpose of this clause, an individual shall be considered to hold a right or
entitlement directly in the reporting company, if he satisfies any of the
following criteria, namely.-
(i) the shares in the
reporting company representing such right or entitlement are held in the name
of the individual;
(ii) the individual holds
or acquires a beneficial interest in the share of the reporting company under
sub-section (2) of section 89, and has made a declaration in this regard to the
reporting company.
Explanation Ill - For the
purpose of this clause, an individual shall be considered to hold a right or
entitlement indirectly in the reporting company, if he satisfies any of the
following criteria, in respect of a member of the reporting company, namely:-
(i) where the member of
the reporting company is a body corporate (whether incorporated or registered
in India or abroad), other than a limited liability partnership, and the
individual,-
(a) holds majority stake
in that member; or
(b) holds majority stake
in the ultimate holding company (whether incorporated or registered in India or
abroad) of that member;
(ii) where the member of
the reporting company is a Hindu Undivided Family (HUF) (through karta), and
the individual is the karta of the HUF;
(iii) where the member of
the reporting company is a partnership entity (through itself or a partner),
and the individual,-
(a) is a partner; or
(b) holds majority stake
in the body corporate which is a partner of the partnership entity; or
(c) holds majority stake
in the ultimate holding company of the body corporate which is a partner of the
partnership entity.
(iv) where the member of
the reporting company is a trust (through trustee), and the individual,-
(a) is a trustee in case
of a discretionary trust or a charitable trust;
(b) is a beneficiary in
case of a specific trust;
(c) is the author or
settler in case of a revocable trust.
(v) where the member of
the reporting company is,-
(a) a pooled investment
vehicle; or
(b) an entity controlled
by the pooled investment vehicle,
based in member State of
the Financial Action Task Force on Money Laundering and the regulator of the
securities market in such member State is a member of the International
Organization of Securities Commissions, and the individual in relation to the
pooled investment vehicle,-
(A) is a general partner;
or
(B) is an investment
manager; or
(C) is a Chief Executive Officer
where the investment manager of such pooled vehicle is a body corporate or a
partnership entity.
Explanation IV Where the
member of a reporting company is,
(i) a pooled investment
vehicle; or
(ii) an entity controlled
by the pooled investment vehicle,
based in a jurisdiction
which does not fulfil the requirements referred to in clause (v) of Explanation
Ill, the provisions of clause (i) or clause (ii) or clause
(iii) or clause (iv) of
Explanation III, as the case may be, shall apply.
Explanation V - For the
purpose of this clause, if any individual, or individuals acting through any
person or trust, act with a common intent or purpose of exercising any rights
or entitlements, or exercising control or significant influence, over a
reporting company, pursuant to an agreement or understanding, formal or
informal, such individual, or individuals, acting through any person or trust,
as the case may be, shall be deemed to be 'acting together'.
Explanation VI - For the
purposes of this clause, the instruments in the form of global depository receipts,
compulsorily convertible preference shares or
compulsorily convertible
debentures shall be treated as 'shares'.
(i) significant influence
means the power to participate, directly or indirectly, in the financial and
operating policy decisions of the reporting company but is not control or joint
control of those policies'.
3. In the principal rules,
for rules 3 and 4, the following rules shall be substituted, namely:-
2A. Duty of the reporting
company - (1) Every reporting company shall take necessary steps to find out if
there is any individual who is a significant beneficial owner, as defined in
clause (h) of rule 2, in relation to that reporting company, and if so,
identify him and cause such individual to make a declaration in Form No. BEN-1
(2) Without prejudice to
the generality of the steps stated in sub-rule (1), every reporting company
shall in all cases where its member (other than an individual), holds not less
than ten per cent of its;-
(a) shares, or
(b) voting rights, or
(c) right to receive or
participate in the dividend or any other distribution payable in a financial
year, give notice to such member, seeking information in accordance with sub
section (5) of section 90, in Form No. BEN-4.
3. Declaration of significant
beneficial ownership under section 90 - (1) On the date of commencement of the
Companies (Significant Beneficial Owners) Amendment Rules, 2019, every
individual who is a significant beneficial owner in a reporting company, shall
file a declaration in Form No. BEN-1to the reporting company within ninety days
from such commencement.
(2) Every individual, who
subsequently becomes a significant beneficial owner, or where his significant
beneficial ownership undergoes any change shall file a declaration in Form No.
BEN-1 to the reporting company, within thirty days of acquiring such
significant beneficial ownership or any change therein.
Explanation - Where an
individual becomes a significant beneficial owner, or where his significant
beneficial ownership undergoes any change, within ninety days of the
commencement of the Companies (Significant Beneficial Owners) Amendment Rules,
2019, it shall be deemed that such individual became the significant beneficial
owner or any change therein happened on the date of expiry of ninety days from
the date of commencement of said rules, and the period of thirty days for
filing will be reckoned accordingly.
4. Return of significant
beneficial owners in shares - Upon receipt of declaration under rule 3, the
reporting company shall file a return in Form No. BEN-2 with the Registrar in
respect of such declaration, within a period of thirty days from the date of
receipt of such declaration by it, along with the fees as prescribed in Companies
(Registration offices and fees) Rules, 2014.
4. In the said principal
rules, for rules 7 and 8, the following rules shall be substituted, namely:-
7. Application to the
Tribunal
The reporting company
shall apply to the Tribunal, -
(i) where any person fails
to give the information required by the notice in Form No. BEN-4, within the
time specified therein; or
(ii) where the information
given is not satisfactory, in accordance with sub-section (7) of section 90,
for order directing that the shares in question be subject to restrictions,
including -
(a) restrictions on the
transfer of interest attached to the shares in question;
(b) suspension of the
right to receive dividend or any other distribution in relation to the shares
in question;
(c) suspension of voting
rights in relation to the shares in question;
(d) any other restriction
on all or any of the rights attached with the shares in question.
8. Non-Applicability
-These rules shall not be made applicable to the extent the share of the reporting
company is held by,-
(a) the authority
constituted under sub-section (5) of section 125 of the Act;
(b) its holding reporting
company:
Provided that the details
of such holding reporting company shall be reported in Form No. BEN-2.
(c) the Central Government,
State Government or any local Authority;
(d) (i) a reporting
company, or
(ii) a body corporate, or
(iii) an entity,
controlled by the Central
Government or by any State Government or Governments, or partly by the Central
Government and partly by one or more State Governments;
(e) Securities and
Exchange Board of India registered Investment Vehicles such as mu tual funds,
alternative investment funds (AIF), Real Estate Investment Trusts (REITs),
Infrastructure Investment Trust (lnVITs) regulated by the Securities and
Exchange Boa rd of India,
(£) Investment Vehicles
regulated by Reserve Bank of India, or Insurance Regulatory and Development
Authority of India, or Pension Fund Regulatory and Development Authority.
5. In the principal rules,
for Form No. BEN-1, Form No. BEN-2 , Form No. BEN-3 and BEN-4 the following
Forms shall be substituted.
For Details visit below
link.
http://www.mca.gov.in/Ministry/pdf/CompaniesOwnersAmendmentRules_08020219.pdf
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SEBI COMES OUT WITH FORMAT FOR ANNUAL SECRETARIAL AUDIT OF
LISTED ENTITIES
Markets regulator Sebi
Friday came out with the format for listed entities for preparing their annual
secretarial audit and compliance reports This would also be applicable for the
material unlisted subsidiaries of the listed entities, the regulator said in a
circular. Coming out with the circular regarding format for annual secretarial
audit report and annual secretarial compliance report for listed entities and
their material subsidiaries, Sebi said the compliance report should be submitted
to the exchanges within 60 days of the end of a financial year. Currently,
under the Companies Act, the entities are required to file an annual
secretarial audit report by practising company secretaries. The annual
secretarial audit reports are meant to keep a tab on entities regarding
compliance with applicable laws. The ICSI (Institute of Company Secretaries of
India) may consider issuing a guidance note to practising company secretaries
to enable them to undertake certifications in accordance with the regulations
and this circular in letter and in spirit, the watchdog said. As per Sebi
norms, every listed entity and its material unlisted subsidiaries incorporated
in the country should undertake secretarial audit and shall annex with its
annual report, a secretarial audit report, with effect from the year ended
March 31, 2019.
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NCLT CLOSES INSOLVENCY PROCEEDINGS AGAINST PARSVNATH LANDMARK
The National Company Law
Tribunal has closed the insolvency resolution process against a Parsvnath
Developers' subsidiary after homebuyers 'amicably settled' their dispute with
the realty firm. Parsvnath Developers' arm Parsvnath Landmark is constructing a
housing project comprising 500 units, at Civil Lines in the national capital.
In its order dated January 11, the NCLT had allowed insolvency proceedings
against Parsvnath Landmark after three home buyers approached the tribunal
complaining about delay in completion of the project. However, a two-member
bench of the NCLT stopped the insolvency proceeding in an order dated February
1, after the financial creditors of the company (homebuyers) informed about the
settlement with Parsvnath Landmark. The three flat buyers along with the
company filed their affidavits before the tribunal informing the decision. As a
sequel to the above discussion, the order dated January 11, 2019 initiating
Corporate Insolvency Resolution Process against the Corporate Debtor is closed
and naturally the order would not be given effect any further, said the NCLT.
The tribunal has also directed the interim resolution professional appointed
for Parsvnath Landmark to not conduct any proceedings. It further said: We hope
and trust that the parties will abide by the terms of the settlement and avoid
another petition with a prayer for triggering of Corporate Insolvency and
Bankruptcy Process. However, the IRP informed the tribunal that the committee
of creditors has not yet been constituted The IRP also said that 300 claims
have been received against the company after a public notice was issued to
invite the same. On this NCLT observed: We find that this application is
covered, however we constrained to observe that the 300 claims which have been
received by the IRP may result in to a spat of the other petitions under
Section 7 or 9 of the Code, 2016.
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PSU BANKS' BAD LOANS DECLINE TO RS 8,64,433 CRORE IN
APRIL-DECEMBER FY'19: GOVERNMENT
Bad loans of public sector
banks declined by more than Rs 31,000 crore to Rs 8,64,433 crore in the first
nine months of the current fiscal as compared to end of March 2018, the
government said on Friday. Non-performing assets (NPAs) or bad loans of the
banks stood at Rs 8,95,601 crore at the end of previous fiscal, Shiv Pratap
Shukla said. Bad loans fell to Rs 8,75,619 crore as on June 2018 and further to
Rs 8,64,433 crore in December 2018 (as per provisional data), he said. Shukla
said presently the government is not considering any proposal for privatisation
of PSBs He said bad loans fell by Rs 31,168 crore in April-December 2018-19
compared to NPAs worth Rs 8,95,601 crore at March-end 2018. Asset Quality
Review (AQR) initiated in 2015 for clean and fully provisioned bank
balance-sheets revealed high incidence of NPAs, he said. As a result of AQR and
subsequent transparent recognition by PSBs, stressed accounts were reclassified
as NPAs and expected losses on stressed loans, not provided for earlier under
flexibility given to restructured loans, were provided for, he said. During the
fourth quarter of 2017-18, all such schemes for restructuring stressed loans
were withdrawn he said. Primarily as a result of transparent recognition of
stressed assets as NPAs, gross NPAs of PSBs as per RBI data on global
operations, increased from Rs 2,27,264 crore as on March 31, 2014, to Rs
2,79,016 crore on March 31, 2015, Rs 5,39,968 crore on March 31, 2016 and Rs
6,84,732 crore as on March 31, 2017, he said. With various steps taken by the
government including the initiation of transparent recognition in 2015-16 till
December 2018, PSBs have successfully recovered an amount of Rs 3,33,491 crore,
he said.
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SEBI OFFERS NO OPINION ON MFS’ BREATHER PLAN FOR ZEE
ENTERTAINMENT
The Securities and
Exchange Board of India (Sebi) has declined to give its opinion on the plan by
mutual funds to give Essel Group’s cash-strapped promoters a breather, said
people aware of the matter. The capital market regulator has put the onus on
funds holding Essel Group debt securities to do what is best for unit holders. They
had sought Sebi’s informal nod for a plan that would give the Subhash
Chandra-led group time to sell assets and repay debt instead of offloading
pledged shares as there has been a drop in the security cover. The funds will
now amend the debenture trust deeds to allow this. They had sought Sebi’s
informal nod for a plan that would give the Subhash Chandra-led group time to
sell assets and repay debt instead of offloading pledged shares as there has
been a drop in the security cover. The funds will now amend the debenture trust
deeds to allow this. Mutual funds had approached the regulator to allow them to
alter the terms of Essel Group debenture trust deeds to give the promoters time
till September to bring in a strategic investor for its media business. The
group had reached an agreement with lenders, including mutual funds and
nonbanking finance companies (NBFCs), to this effect after shares of Zee
Entertainment and Dish TV plunged 26% and 33%, respectively, in a single day on
January 25. That followed a news report alleging links between the Essel Group
and Nityank Infrapower and Multiventures, a company being investigated by the
Serious Fraud Investigation Office (SFIO) for deposits of over Rs 3,000 crore
after demonetisation. That slump sparked panic about forced selling by lenders
as cashstrapped promoters of Zee were unable to provide fresh shares to cover
shortfall in collateral. Lenders, including MFs and NBFCs, had agreed in
principle to hold off from selling shares of the companies in event of a
further drop in prices. Promoters have pledged almost 60% of their 42% in ZEE.
The debenture trust deed specifies the equity cover that promoters have to
maintain with lenders, which hold shares as collateral. The cover ranges from
1.5 to two times the debt. In the case of Zee, the cover had fallen below the
threshold after stock prices fell.
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PUBLIC SECTOR BANKS TO BE RANKED ON BASIS OF PERFORMANCE
The government will start
surveying public sector banks annually to rank them on performance parameters
ranging from profitability to customer satisfaction. Last year, the government
had initiated its reforms agenda for state run lenders termed EASE — Enhanced
Access and Service Excellence — and directed them to draw up a board-approved
strategic vision consistent with their risk-appetite framework. We will come
out with the EASE survey in this fiscal, which will indicate how banks have
performed. This will be done annually and will encourage competitiveness among
lenders a senior finance ministry official said. The parameters include customer
responsiveness, financial inclusion, digital platforms and security. Financial
performance will be assessed on the basis of recoveries made, return on assets
and differentiated banking strategy, the finance ministry official said. The
government expects the financial performance of banks to improve as their bad
loans come down. Last month, the RBI allowed three lenders to come out of the
prompt corrective action framework, under which some of their activities were
curbed. The finance ministry had noted that the recognition exercise for public
sector banks is almost over, with restructured standard assets declining from a
peak of 7% in March 2015 to 0.59% as of September 2018. PSBs have made a record
in recoveries at Rs 60,726 crore in the first half of the current financial
year, which is more than double the amount recovered over the corresponding
period last year, Kumar had said. The government will also infuse the last
tranche of additional capital of Rs 41,000 in state-run lenders to strengthen their
capital base. This would enhance the total recapitalisation in the current
financial year to Rs 1.06 lakh crore from Rs 65,000 crore. The finance ministry
has said that the gross non-performing assets of state-owned banks have started
declining after peaking in March 2018, registering a drop of Rs 23,860 crore in
the first half of the current financial year.
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NESL HAS RECORDS OF TWO-THIRDS OF LOANS GIVEN BY LENDERS,
CREDITORS
More than a year after it
was set up under the Insolvency and Bankruptcy Code (IBC), the country’s first
information utility (IU) NeSL now has records of two-thirds of all loans given
by lenders and operational creditors. National e-Governance Services (NeSL) plans
to get the banks that are not registered with it on board by the end of this
month so that it has a record of all the loans. This would assist in resolving
any dispute that insolvent companies have with the lenders. The information
utility has data verified by the debtor company. National Company Law Tribunal
(NCLT) President M M Kumar had written to all NCLTs that creditor petition must
contain records from the information utility This was done to avoid delays on
account of contest by debtors. In the past, there have been cases where debtor
companies have contested the figures of unpaid loan amount given by lenders in
NCLT.
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RBI MOVE TO REGULATE EPAYMENTS MAY SECURE, STABILISE ECOSYSTEM
The central bank on
Thursday said it is examining the possibility of bringing payment gateway
operators under its direct regulatory ambit a move that industry players said
will make the digital payments ecosystem more secure and stable We are
considering the feasibility of directly regulating these payment operators given
their growing importance in the payment systems of the country, we deem such a
step to be important, Reserve Bank of India governor Shaktikanta Das said. The
RBI said it will soon publish a draft of the regulatory guidelines for
stakeholder consultations. Mint Road and New Delhi have been in talks for some
time now to come up with a comprehensive regulatory solution for the burgeoning
payment systems in the country, which is riding the growth of ecommerce and
m-commerce transactions. Meanwhile, issues ranging from the fees that businesses
pay for accepting digital payments to grievance redressal for failed
transactions and even distinction of the types of payment gateway entities have
emerged as major points of contention among the payment firms, banks and their
customers. The payments industry expects the RBI to address these issues in the
consultation paper. The digital payments space has attracted a large number of
players over the last few years, hence it is necessary to evolve some sort of a
regulatory mechanism to ensure serious players with sound finances remain, said
Anand Ramachandran. The space has evolved so much that it needs regulatory
attention urgently, said Harshil Mathur. There is only self-regulation of sorts
in our industry since we mostly have to abide by rules set by our partner banks
which also differ widely. Common RBI guidelines will help bring standardisation
to the space. Industry sources pointed out that since the RBI encouraged the
companies to bring in innovations in the retail payments space, multiple
players have emerged. While this has helped connect a large number of small
merchants who would otherwise not be serviced by big players, it has also
caused a threat to the ecosystem. Many so-called payment companies are just
bringing in a technology layer over the gateway entity and not making
settlements directly through a nodal bank account. In case of a failure in
transaction, the merchant could be at risk of losing money, said industry
executives. Grievance redressal mechanism is of paramount importance in the
payment gateway space, said a top executive at one of the largest payment
gateway entities in India. The security aspect around digital payments is also
something that needs to be addressed, said Suresh Rajagopalan, which provides
payment solutions to banks and others.
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RBI FINES ALLAHABAD BANK RS 1.5 CR FOR NOT MONITORING FUND
USE, FRAUD REPORTING DELAY
State-owned Allahabad Bank
on Friday said the RBI has imposed a penalty of Rs 1.5 crore on the lender for not
monitoring end use of funds among other violations. We have to inform you that
the Reserve Bank of India has imposed a penalty of Rs 1.5 crore on the bank for
not monitoring the end use of funds, delay in classification and reporting of
fraud and non-adherence with RBI guidelines during restructuring of accounts in
respect of one of its borrowers, the bank said in a regulatory filing. The amount
of penalty is not material considering the size of the bank it added.
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UCO BANK Q3 NET LOSS AT ₹998 CRORE AS BAD LOANS
BALLOON
State-owned UCO Bank
reported a marginal drop in its net loss at ₹998.74 crore for third
quarter ended December 31, 2018, as bad loans and provisions ballooned. The
bank had posted a net loss of ₹1,016.43 crore in the same quarter of the previous fiscal. Total
income of the bank also came down to ₹3,585.56 crore during
October-December period of 2018-19, as against ₹3,721.93 crore in same
quarter of 2017-18, the bank said in a regulatory filing. The
Kolkata-headquartered lender, witnessed worsening asset quality as the gross
non-performing assets (NPAs) ballooned to 27.39% of gross loans at end of December
31, 2018, from 20.64% in December 2017. Sequentially also, NPAs were higher
from 25.37% by end of second quarter ended September of this fiscal. In value
terms, the gross NPAs or bad loans stood at ₹31,121.79 crore as on
December 31, 2018 as against ₹25,382.40 crore a year-ago. Net NPAs were 12.48% by end of
third quarter as against 10.90%. Value-wise, the net NPAs were ₹11,755.61
crore, lower than ₹11,923.45 crore last year. Thus, provisioning for bad loans
during quarter ended December 2018 were hiked to ₹2,243.85 crore as against ₹1,682.40
crore a year earlier. The non-performing loan provisioning coverage ratio is
69.49 per cent as on December 31, 2018, UCO Bank said.
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ___
GOVERNMENT AND RBI SHOULD ADDRESS DIFFERENCES BETWEEN THEM: Y
V REDDY
The government pushed
regulatory forebearance post the global financial crisis of 2008 may be the
root cause of the NPA mess. The RBI sop was abused by banks and industry giving
rise to NPAs, according to former RBI governor Y V Reddy. But as India is going
to be an important player in the global economy, he called for the need for the
government and RBI to address the root causes of the recent standoff between
them. It appears that the fiscal stimulus was, in fact, fiscal deterioration
(since the increase was in recurring revenue expenditures); the monetary
stimulus lasted longer than needed said Reddy. The regulatory forbearance was taken
undue advantage of by the banks and industry resulting in restructured loans
and large NPAs. The spur in lending to infrastructure at this time also led to
large NPAs. All indications are that RBI was constrained by Government in
timely withdrawal of stimulus The issue is significant in the context of
tensions between the government and the Reserve Bank, essentially on the issue
of transfer of RBI’s surplus income, that have been aired in public culminating
in the resignation of governor Urjit Patel. Reddy highlighted that the spirit
of limit on ways and means arrangement under fiscal management legislation has
been compromised. The immediate fiscal needs seem to take precedence over a
renewed assessment of the capital needs of RBI he said. Coordination between government
and central banks to manage the crisis was global and India was no exception
then. But now the issue of governance in central banking is being widely
debated globally. U.S. President Donald Trump has criticised the Federal
Reserve for raising interest rates. European Central Bank president Mario
Draghi recently raised the issue of the threat to central banks’ independence
from governments stating that the ECB mandate does not involve financing
government’s deficit. President Erdogan accused the Central Bank of a
traitorous reluctance to lower interest rates. Reddy suggested that in a
globally integrated world India will be increasingly important to the world. It
also has more opportunities than ever before in the area of financial sector
for our dominance with India’s strengths in technology and skilled manpower. To
take advantage of it, Government of India in partnership with Reserve Bank of
India should address the root causes of the recent standoff between them Reddy
said.
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RBI GOVERNOR TO MEET BANK CEOS TO DISCUSS RATE CUT
TRANSMISSION
The Reserve Bank of India
(RBI) Governor will soon meet chief executives of public sector banks to
discuss, among other things, the issue of monetary policy transmission. This
follows the central bank lowering the interest rates for the first time in
one-and-a-half years. Banks have always been reluctant to reduce interest rates
whenever there is a rate cut by the RBI. Whenever there is policy rate
reduction, it would be RBI’s expectation that monetary transmission does takes
place, RBI Governor Shaktikanta Das said. But we have to keep in mind that fixing
the rate of the interest is a function of the bank. We will be having an
interaction in the next fortnight or so with the CEO and MDs of all banks where
we will discuss these issues, he added. Banks have been increasing lending
rates since March 2018. While the RBI has proposed that banks should move to an
external benchmark for loan pricing from April 1, lenders have been opposing
the move saying their funding costs were not linked to the external benchmarks
proposed by the regulator. We hope that the rate cut will be transmitted by the
financial sector to the real economy, so that economic activity could [take advantage
of] the benefits and private consumption/investments may also grow faster, said
Motilal Oswal. Non-banking finance companies, which are predominantly dependent
on bank funding and have seen their borrowing costs climb ever since the
IL&FS crisis broke out in August, also expect the cost of funds to come
down.
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BANKS SEEN UNLIKELY TO MATCH RBI'S RATE CUT ANY TIME SOON
Bankers say piles of bad
debt and the high cost of deposits mean they are unlikely to reduce interest
rates on loans by as much as the central bank cut its key lending rate in a bid
to spur growth. Making more credit available more cheaply is vital for Modi,
who wants to please businesses, farmers and individual borrowers. Four senior
public and private sector bankers told Reuters on Friday that they might only
cut lending rates by 5-10 basis points. A move of that size would have a
negligible impact in boosting credit, or in reducing refinancing costs. If
there is a lot of (government) pressure, then I may cut by a notional 5-10
basis points said the head of a big state-run bank who asked for anonymity due
to sensitivity of the subject. That may have a psychological impact on
corporates but will not really help in boosting credit growth or lowering
borrowing costs. Economic growth has slowed, with private investments slumping
and consumption gains muted. Annual industrial output growth in November rose
4.1 per cent, down from October's 8.4 per cent. For the banks - often stuck
with bad loans and heavy provisioning - any cut in loan rates is unlikely
without a corresponding fall in deposit rates, which will require cash
conditions to improve significantly, say bankers. And banks are reluctant to
cut deposit rates in the fiscal year's last quarter, as they are keen to shore
up their books while not losing hefty deposits. Banks price their benchmark
loan rates, known as the marginal cost of funds based lending rate (MCLR),
mainly based on the cost of deposits. MCLR might not come down significantly
very soon as any meaningful change will depend on cost of funds, said
Parthasarathi Mukherjee. Unless banking system liquidity rises, he said, we are
not seeing any substantial fall in lending rates across the board any time
soon.
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SEBI ISSUES ELIGIBILITY CRITERIA FOR PHYSICAL SETTLEMENT OF
STOCK DERIVATIVES
Markets watchdog Sebi
Friday came out with new conditions with respect to physical settlement of
stock derivatives According to a circular, in addition to the existing schedule
of stock derivatives, the derivatives on stock meeting the eligibility criteria
specified by the regulator will also be physically settled from the new expiry
cycle. The stocks that qualify for physical settlement are the ones that witness
an intra-day movement of 10 per cent or above on ten or more occasions in the
last six months or three or more occasions in the last one month. Other
eligibility criteria for the stock includes an intra-day movement of 25 per
cent or above on one or more occasions in the past one month. Further, if the
maximum daily volatility of the stock exceeds 10 per cent either in equity or
equity derivatives segment in the last one month, the stocks shall be
physically settled, Sebi added. The maximum daily volatility of the stock will
be as estimated for margining purpose. The Securities and Exchange Board of
India (Sebi) said the exchanges shall review the above conditions on a monthly
basis Existing contracts on the stock, however, shall continue to follow the
settlement mode as applicable at the time of contract introduction.
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SEBI INITIATES ACTION AGAINST BROKER IN NSE MATTER: P
RADHAKRISHNAN
The Securities and
Exchange Board of India (Sebi) has taken action against one broking firm in a
case relating to the alleged unfair access to National Stock Exchange (NSE)
servers Parliament was informed Friday. Enforcement actions have been initiated
by SEBI against one broking firm, inter alia, for consistently logging in first
to the servers disseminating tick by tick (TBT) data feed of NSE and
consistently logging on to the secondary server and 2 broking firms, inter
alia, for consistently logging on to the secondary server, Minister of State
for Finance Pon Radhakrishnan said. He also said that administrative warnings
have been issued to another six broking firms in this regard. Further, the NSE
has been advised to carry out detailed scrutiny of all such broking firms which
had connected to the secondary servers apart from the broking firms already
covered by the capital market regulator, he said. The Sebi had appointed two
audit firms -- Deloitte Touche India LLP and Ernst and Young LLP (EY) for
carrying out forensic audit of the broking firms which had alleged to have
gained preferential access to servers disseminating TBT data feed at the NSE,
Radhakrishnan said. The two audit firms have submitted their reports to the
Sebi, he said, adding that the reports have brought out that one of the broking
firms was consistently logging in first to the servers disseminating TBT data
feed of the NSE, thereby gaining advantage in terms of receipt of TBT data
deed.
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PE, VC INVESTMENTS FALL 49% IN JAN, SAYS REPORT
This year began on a slow
pace for private equity (PE) and venture capital (VC) investments with deals in
January falling 49% from the year earlier to $1.8 billion, said EY. Deal volume
however, climbed 65% on a year-on-year basis, the consulting and auditing firm
said in a report. The drop in deal value is mainly due to the lack of large,
$1-billion-plus deals last month. After a strong performance in 2018, headline
numbers on PE/VC investment activity in January 2019 appear to indicate a
comparatively subdued start. However, we believe this data is skewed on account
of the absence of large deals in January 2019. Underlying data indicates a
robust start to PE/VC investment activity in January 2019 with significant
increase in growth, buyout and startup investments on a y-o-y basis, said Vivek
Soni. The month saw four large deals ($100-million-plus deals) totalling $1.1
billion, compared to five large deals worth $2.8 billion in January 2018, and
six large deals worth $2.3 billion in December 2018. The largest deal this
January was SoftBank’s $397 million investment in FirstCry, an e-commerce
platform for child and baby products. The other big deals during the month
included Apax’s $230 million investment in Fractal Analytics, and AION’s buyout
of InterGlobe Technologies for $230 million. The strong trend of buyouts
continued this year with four deals worth $504 million, rising 20% from January
2018. A sector-wise break up shows e-commerce leading the pack with 11 deals
worth $607 million, followed by technology with $438 million across nine deals.
Exit deals dropped significantly with January recording transactions worth $360
million against $969 million in the previous year, largely due to fewer large
exits. The largest exit in January 2019 saw TA Associates and Khazanah selling
their entire stakes in Fractal Analytics to Apax for $200 million. In terms of
number of exits, January 2019 recorded just 13 exits, compared to 29 last year.
The lower exit deal activity was primarily on account of fewer open market
exits. Besides, there were no PE-backed initial public offerings in January.
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POWER PRODUCERS IN A FIX AS PILING DUES FROM DISCOMS CHOKE
THEIR CASH FLOWS
Power producers are in a bind
over swelling dues owed by the electricity distribution companies (discoms). By
the end of October 2018, the accumulated dues had climbed to Rs 38,904.47
crore, leaving the power generators in distress. Irked over the delay by the
unresponsive discoms, NTPC recently sent notices to discoms in Telangana,
Andhra Pradesh and Karnataka over pending dues after the discoms failed to
honour their assurances to clear the backlog soon The pendency in the three
states is in upwards of Rs 4,000 crore with the delay running into over 60
days. However, NTPC has decided against regulating power supply after the
discoms gave fresh assurances on payments. NTPC had slapped notices by invoking
provisions contained in the Central Electricity Regulatory Commission (CERC),
the central power regulator. But NTPC's counterparts in the private sector are constrained
to act tough with discoms in most states owned by the state governments. We
have built our case with the Union power ministry. But to this day, we have
only been getting assurances. Mounting dues is hurting the cash flow of the
private power generators. The companies need a healthy cash balance for
operational expenses and buying critical inputs like coal. If you ask me, most
of the independent power producers (IPPs) today are in distress largely because
of the accumulated dues owed to them by discoms, said a senior executive with a
private power producer. Of the piled up Rs 38,904.47 crore in dues, NTPC tops
the list with a share of around 40 per cent. Data sourced from the Union power
ministry shows the maharatna power producer has to recover Rs 15,623.64 crore
from the erring discoms. Others that trail NTPC are Adani Power (Rs 6,957.33
crore), National Hydroelectric Power Corporation- NHPC (Rs 25,72.71 crore),
Damodar Valley Corporation- DVC (Rs 1,990.59 crore), GMR Energy (Rs 1,630.40
crore) and Tata Power (Rs 1,139.93 crore). We have flagged this issue in
meetings with the Union power ministry and Central Electricity Authority (CEA),
an industry source said. At a recent presentation by IPPs to the Union power
ministry, the power companies have asked for strict enforcement of PPA (power
purchase agreements) clauses on escrow or payment security mechanisms for
discoms with regular performance review. IPPs have demanded rationalized supply
of coal and opposed exemption of late payment surcharges on discoms.
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ___
INVESTORS' WEALTH PLUNGES RS 1.67 TRILLION AS STOCKS TUMBLE
Investors' wealth on
Friday eroded by Rs 1.67 trillion following a sharp sell-off in the broader
market where the BSE index plummeted nearly 425 points. The 30-share Sensex
cracked 424.61 points, or 1.15 per cent, to close at 36,546.48. Following the
weak sentiment, the market capitalisation of BSE- listed companies dropped Rs
1,67,594.92 crore to Rs 1,41,07,190.48 crore. From the 30-share pack, 25 stocks
ended with losses where Tata Motors took the steepest hit of 17.28 per cent. Sectorally,
the BSE metal index plunged 3.42 per cent, while the auto gauge shed 3.37 per
cent. On the BSE, 1,616 stocks declined and 923 advanced, while 111 remained
unchanged. Also, 321 stocks hit their 52-week low.
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ___
FOREX RESERVES UP BY $2.06 BN DUE TO RISE IN FOREIGN CURRENCY
ASSETS: RBI
The country's foreign
exchange reserves increased by $2.063 billion to $400.24 billion in the week to
February 1, on account of rise in foreign currency assets, according to RBI
data. In the reporting week, foreign currency assets, a major component of the
overall reserves, rose by $ 1.280 billion to $ 373.430 billion. Gold reserves
increased by $ 764.9 million to $ 22.686 billion in the reporting week, the
data showed. The special drawing rights with the International Monetary Fund
(IMF) rose by $ 6.2 million to $ 1.470 billion. The country's reserve position
with the IMF also increased by $ 11.2 million to $ 2.654 billion, the apex bank
said.
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RUPEE RISES FOR 4TH DAY; UP 14 PAISE AT 71.31/USD
The rupee appreciated by
14 paise Friday to close at 71.31 against the US dollar on persistent foreign
fund inflows even as the greenback strengthened overseas amid fresh concerns
over global growth. This is the fourth successive session of gain for the
domestic currency, during which it has climbed 49 paise. At the Interbank
Foreign Exchange, the rupee opened stronger at 71.37 a dollar. The local unit
moved in a range of 71.44 to 71.03, before finally ending at 71.31, showing a
gain of 14 paise. The rupee Thursday appreciated by 11 paise to close at 71.45
against the US dollar. On a weekly-basis, however, the domestic currency
registered a loss of 6 paise. Reduction in interest rates and relaxation of
foreign investment limits bodes well for the rupee in expectation of overseas
inflows. So far this month, overseas investors bought USD 297.10 million in
equity while they sold worth USD 304.70 million in debt market, said V K
Sharma. Meanwhile, the dollar index, which gauges the greenback's strength
against a basket of six currencies, rose 0.7 per cent to 95.57.
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RS 400 CRORE SHARE INVOCATION ILLEGAL, 72 LAKH SHAREHOLDERS
HURT: RELIANCE CAPITAL
Reliance Capital on Friday
alleged that the invocation of Rs 400 crore worth of NBFC's pledged shares by
Edelweiss and L&T Finance was illegal, motivated and wholly unjustified The
manner of conduct of the above open market sales, without any attempts
whatsoever at orderly market disposal through a bid or structured process for
shares comprising the holding of the promoter group, is illegal on several
counts, it claimed. The NBFC said the purported exercise of rights to enforce
the security was illegal and excessive, and against the process and
requirements of the respective borrowings' documentation. The selling, it said,
precipitated a fall of Rs 13,000 crore or 55 per cent in the market
capitalisation of Reliance group in four days, the company said in a press
release. It caused 75 lakh institutional and retail shareholders the company
claimed, harmining the interest of all stakeholders The company said the group
companies Reliance Capital, Reliance Infrastructure and Reliance Power are
performing satisfactorily on all operating parameters. There is no change
whatsoever on any aspect as compared to the position prevailing prior to these
sales, the company said in a filing to BSE.
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RELIANCE GROUP ACCUSES L&T FINANCE, EDELWEISS OF 'ILLEGAL'
ACTIONS
Anil Ambani-led Reliance
Group Friday accused L&T Finance and Edelweiss entities of illegal and
motivated actions in invoking the pledged shares and selling them in open
market causing a steep fall in its share value A few NBFCs, substantially
L&T Finance and certain entities of Edelweiss Group, have invoked pledge of
listed shares of Reliance Group and made open market sales of the value of
approximately Rs 400 crore from February 4 to 7, the group said in a statement.
The illegal, motivated and wholly unjustified action by the above two groups
has precipitated a fall of Rs 13,000 crore, an unprecedented nearly 55 per
cent, in market capitalisation of Reliance Group over just these four short
days, it noted. The group said the actions have caused substantial losses to 72
lakh institutional and retail shareholders, and harming the interests of all
stakeholders. Citing legal advice, the group also said the purported exercise
of rights to enforce the security is illegal and excessive, and against the
process and requirements of the respective borrowings' documentation.
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ___
RAYMOND REBOUNDS 7% AFTER CLARIFICATION ON RELATED PARTY
TRANSACTION REPORT
After six days of
successive fall, Raymond shares surged 7 per cent on BSE in morning trade on
Friday after the company gave clarification in a BSE filing about related party
transactions. The company said all of its related party transactions are
undertaken in compliance with laws and that the media report relating to
related party transactions is misleading and misconstrued. We have taken
appropriate approvals, made relevant disclosures and undertaken all related
party transactions on an arm's length basis, which has been certified by
independent reputed accounting firms, the company said.
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ___
PATANJALI BACKS GOVERNMENT’S REVISED E-COMMERCE POLICY
Baba Ramdev-promoted
Patanjali Ayurved has said the government’s revised ecommerce policy on foreign
direct investment (FDI) which was rolled out on February 1 this year will help
to create a level-playing field for all retail platforms, and encourage fair
and healthy competition among them, one year after it inked extensive
partnerships with leading e-retailers including Amazon, Flipkart and Paytm Mall
to push its products online. In our view, an environment of equal opportunity
is needed for all trade and retail platforms as organised trade and retail is
at their early stages in India, SK Tijarawala said. At the time of
collaborating with ecommerce companies, Baba Ramdev had said the company will reach
out to more people including the youth who prefer and use online platforms for
shopping more these days. Patanjali, seen as the biggest disruptor in recent
times in the fast-moving consumer goods (FMCG) space, which forced established
companies such as HUL and Colgate-Palmolive to launch herbal-ayurvedic
products, reported standalone consumer goods revenues of Rs 8,148 crore in the
year ended March 2018, according to a report by Care Ratings.
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ___
AMAZON PAVES WAY FOR THOUSANDS OF ITEMS TO RETURN TO INDIA
SITE
Amazon has struck a deal
that will allow hundreds of thousands of products forced offline because of new
e-commerce rules to return to its Indian site, a source said Friday. Some 400,000
items disappeared from Amazon.in after stringent regulations banning online
marketplaces from selling products from firms in which they have a stake came
into force last week. Amazon and US rival Walmart -- which bought a 77-percent
share in Indian e-commerce behemoth Flipkart last year -- are investing
billions of dollars in India's rapidly growing online consumer market. Two of
Amazon's local venture partners, including a firm called Cloudtail, were forced
to remove thousands of items from the US company's website after the
regulations kicked in on February 1. Hundreds of thousands of products will be
back, they added. Indian law already prevents foreign-owned companies from
selling directly on their internet sites so the e-commerce companies had been
buying in bulk and then selling the products to favoured vendors. These then
resell the products at discount on the e-commerce sites who legally remain
intermediaries.
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ___
‘ECOMMERCE RULES WON’T HIT CLOUDTAIL VOLUMES ON AMAZON’
The recent change in
ecommerce regulations will in no way impact the transaction volumes of
Cloudtail India on the Amazon portal, as those had always been below a quarter
of the online retailer’s annual sales transactions, people familiar with the
matter said. Cloudtail, in fact, will derive growth from the expansion of
India’s retail market and pick-up in volumes on portals such as Amazon India,
they said. According to statistics, online transactions were 0.8% of India’s
total retail market in 2014, and are expected to touch 4.4% this year and expand
quickly in the coming years. Ecommerce revenue in India is projected to grow to
$150 billion in 2022, a report by Nasscom and PwC had said in August last year.
The new regulations bar any single seller from contributing to more than a
quarter of an ecommerce platform’s sales. The updated rules, which came into
effect from February 1, also say inventory of a vendor will be deemed to be
controlled by a marketplace entity if more than 25% of purchases of such
vendors are from the marketplace entity or its group companies. Cloudtail India
is 100% owned by Prione, a provider of services to small and medium sellers
across India. Murthy’s company has increased its stake in Prione to 76% from
51% after the new regulations came into effect.
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ___
BHARTI AIRTEL UNIT TO MERGE WITH TELKOM KENYA
India's Bharti Airtel on
Friday said its unit, Airtel Networks Kenya Ltd, has agreed to merge with
Telkom Kenya Ltd, the East African nation's smallest telecom operator. Last
month, three industry sources had told that Bharti Airtel was in talks to buy
Telkom Kenya, to create a stronger challenger to market leader Safaricom. The
companies will combine their respective mobile, enterprise and carrier services
businesses in Kenya to operate as Airtel-Telkom, Airtel said, without revealing
further details.
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ___
FACEBOOK SCRAPS LOL MEME PLATFORM, ANNOUNCES REJIG IN ‘YOUTH’
TEAM
Facebook on Thursday
announced it had restructured its team devoted to products or features designed
to increase the social network’s appeal to younger generations Nascent projects
such as a LOL platform for funny memes were taken off the board at the youth
team, which shifted focus to more promising products such as a Messenger Kids
app launched more than a year ago, according to the leading social network. The
Youth team has restructured in order to match top business priorities,
including increasing our investment in Messenger Kids, Facebook said in
response to an AFP inquiry. The social media giant said at the time that it
created the app, available in the United States, Canada, Mexico, Peru and
Thailand, because many children were going online without safeguards. We found
that there was a need for a video chat and messaging app that lets kids connect
with the people they love while putting parents in complete control, product
management lead Jennifer Billock said in a blog post marking the app’s one year
anniversary. We conducted parent roundtables in each country and have continued
gathering feedback from parents and outside experts. Facebook’s rules require
that children be at least 13 to create an account, but many are believed to get
around the restrictions.
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ___
WE DON'T REVIEW, PRIORITISE POLICIES BASED ON POLITICAL
IDEOLOGY: TWITTER
Facing heat over
allegations of political bias in the country, Twitter Friday said the
microblogging platform is committed to remain unbiased and that its product, as
well as policies, are never based on political ideology. Twitter, which counts
India among its biggest markets, asserted that the company does not take any
actions based upon political views or viewpoints, neither does it use political
ideology to rank content on its service. The statement comes against the
backdrop of the Parliamentary panel on information technology asking Twitter
officials to appear before it on February 11 over the issue of safeguarding
citizens' rights on social media platforms. There has been a lot of discussion
about Twitter and political bias in India in recent weeks and the global
real-time communication platform today set the record straight. Twitter is a
platform where voices from across the spectrum can be seen and heard. It is
committed to the principles of openness, transparency, and impartiality,
Twitter said in a statement. The social media giant has been summoned days
after the members of Youth for Social Media Democracy, a right-wing group,
protested outside its office alleging that Twitter has acquired an
anti-right-wing attitude and has been blocking their accounts In its statement
Friday, Twitter argued that the content that appears in users' timelines, or
the manner in which the company enforces its policies are impartial and said
that it is committed to remain unbiased with public interest in mind. Twitter's
product and policies are never developed nor evolved on the basis of political
ideology Abuse and hateful conduct comes from accounts across the ideological
spectrum and Twitter will continue to take action when its rules are broken, it
added. Twitter does not review, prioritise, or enforce its policies on the
basis of political ideology. Every Tweet and every account is treated
impartially. We apply our policies fairly and judiciously for all. If there are
'false positive' decisions, these are not political statements of intent; they
are the basic human error rate of running the fastest, most open conversational
tool in history, Twitter Global VP (Public Policy) Colin Crowell said. The company
stated that the public verification process on its platform is currently
closed. India is the world's largest democracy, and one of our fastest-growing
audience markets globally. Twitter's real-time and open nature facilitates
robust civic engagement on topics of national and local interest during
elections. We are committed to surfacing all sides of the conversation as we
enter the election season in this extraordinarily diverse cultural, political
and social climate, Crowell said.
#For Source of Information copy and paste the heading in google.
Thanks & Regards,
CS Meetesh Shiroya
Thanks & Regards,
CS Meetesh Shiroya
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