Rule 6: Creation and maintenance of databank of persons offering to become independent directors

Rule 6: Creation and maintenance of databank of persons offering to become independent directors · Complied AI

(4)

Every individual whose name is so included in the data bank under sub-rule (1) shall pass an online proficiency self-assessment test conducted by the institute within a period of two years from one year from the date of inclusion of his name in the data bank, failing which, his name shall stand removed from the data bank of the institute:

Proviso

Provided that an individual shall not be required to pass the online proficiency self-assessment test when he has served for a total period of not less than three years as on the date of inclusion of his name in the data bank,-

(A)

as a director or key managerial personnel, as on the date of inclusion of his name in the databank, in one or more of the following, namely:-

(a)

listed public company; or

(b)

unlisted public company having a paid-up share capital of rupees ten crore or more; or

(c)

body corporate listed on any recognized stock exchange or in a country which is a 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; or

(d)

bodies corporate incorporated outside India having a paid-up share capital of US$ 2 million or more; or

(e)

statutory corporations set up under an Act of Parliament or any State Legislature carrying on commercial activities; or

(B)

in the pay scale of Director or equivalent or above in any Ministry or Department, of the Central Government or any State Government, and having experience in handling,—

(i)

the matters relating to commerce, corporate affairs, finance, industry or public enterprises; or

(ii)

the affairs related to Government companies or statutory corporations set up under an Act of Parliament or any State Act and carrying on commercial activities.

(B)

in the pay scale of Director or above in the Ministry of Corporate Affairs or the Ministry of Finance or Ministry of Commerce and Industry or the Ministry of Heavy Industries and Public Enterprises and having experience in handling the matters relating to corporate laws or securities laws or economic laws; or

(C)

in the pay scale of Chief General Manager or above in the Securities and Exchange Board or the Reserve Bank of India or the Insurance Regulatory and Development Authority of India or the Pension Fund Regulatory and Development Authority and having experience in handling the matters relating to corporate laws or securities laws or economic laws :

Proviso

Provided further that for the purpose of calculation of the period of three years referred to in the first proviso, any period during which an individual was acting as a director or as a key managerial personnel in two or more companies or bodies corporate or statutory corporations at the same time shall be counted only once.

Proviso

Provided also that the following individuals, who are or have been, for at least ten years :—

(A)

an advocate of a court; or

(B)

in practice as a chartered accountant; or(

C) in practice as a cost accountant; or(D) in practice as a company secretary, shall not be required to pass the online proficiency self-assessment test.

Proviso

Provided that an individual shall not be required to pass the online proficiency self-assessment test, when he has served as a director or key managerial personnel, for a total period of not less than ten years, as on the date of inclusion of his name in the databank, in one or more of the following, namely:

(a)

listed public company; or

(b)

unlisted public company having a paid-up share capital or rupees ten crore or more; or

(c)

body corporate listed on a recognized stock exchange:

Proviso

Provided further that for the purpose of calculation of the period of ten years referred to in the first proviso, any period during which an individual was acting as a director or as a key managerial personnel in two or more companies or bodies corporate companies at the same time shall be counted only once.

Proviso

Provided that the individual who has served for a period of not less than ten years as on the date of inclusion of his name in the databank as director or key managerial personnel in a listed public company or in an unlisted public company having a paid-up share capital of rupees ten crore or more shall not be required to pass the online proficiency self-assessment test:

Explanation

For the purposes of this rule,-

(a)

the expression “institute” means the ‘Indian Institute of Corporate Affairs at Manesar’ notified under sub-section (1) of section 150 of the Companies Act, 2013 as the institute for the creation and maintenance of data bank of Independent Directors;

(b)

an individual who has obtained a score of not less than fifty percent sixty percent . in aggregate in the online proficiency self-assessment test shall be deemed to have passed such test;

(c)

there shall be no limit on the number of attempts an individual may take for passing the online proficiency self-assessment test.