MCA Notifies Amendments to the Companies (Compromises, Arrangements and Amalgamations) Rules, 2025

Introduction

The Ministry of Corporate Affairs has notified the Companies (Compromises, Arrangements and Amalgamations) Amendment Rules, 2025, vide G.S.R. 603(E) dated 4 September 2025, further refining the fast-track mergers framework under section 233 of the Companies Act, 2013 and updating allied procedural forms. The amendments take effect from the date of publication in the Official Gazette. Effectively, they expand the window of transactions qualifying for the RD route, compress documentary requirements (such as a new auditor’s certificate), and coordinate filing mechanics and timelines, specifically for intimations of approval and valuation documents. They also make clear that the streamlined route applies, mutatis mutandis, to schemes of division or transfer of undertakings within section 232(1)(b), with the Central Government having the power to include protective conditions similar to section 232(3). These reforms are designed to speed low-risk reorganisations while maintaining regulatory sight (including that of sectoral regulators and stock exchanges).

Law

Section 233 of the Companies Act, 2013, facilitates some types of mergers and amalgamations to go ahead through a quick route, mostly in front of the regional director, instead of through the National Company Law Tribunal, subject to safeguards as may be specified. Rule 25 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 prescribes the procedural framework for such fast-track arrangements, including the nature and contents of notices calling for objections or suggestions from the Registrar of Companies, the Official Liquidator, and persons who are likely to be affected, and prescribes filing requirements following member and creditor sanction.

The 2025 amendments redesign sub-rule (1) to normalise the notice form and specifically mandate routing to sectoral regulators (RBI, SEBI, IRDAI, PFRDA) and, for listed companies, to the relevant stock exchanges, within the statutory window of section 233(1)(a). They also redesign sub-rule (4) relating to post-meeting filings and broaden sub-rule (1A) to include more transaction types under section 233, subject to quantitative and qualitative hurdles. Lastly, a new sub-rule (9) extends the fast-track framework to some of the schemes under section 232(1)(b), allowing the Central Government to include terms similar to section 232(3)(a) to (j) to protect stakeholder interests.

Amendments

First, notice architecture under Rule 25(1) has been substituted. The notice of objections or suggestions to a proposed scheme under section 233(1)(a) is now required to be mandatorily in Form CAA-9 and, where the company is within the remit of a sectoral regulator, to be issued to such a regulator; with regard to listed companies, similarly to be issued to the stock exchange(s) concerned, all within the period to be prescribed by the Act.

This formalises regulator and market interaction in the fast-track route and eliminates any vagueness regarding addressees and timing. The revised Annexure replaces a new Form CAA-9 accordingly. Secondly, sub-rule (1A) has been widened to list more eligible combinations in the fast-track route. Aside from the existing classes, three new classes have been added. One, a merger of a company specified in section 8 with one or more unlisted companies which are not section 8 companies or the reverse where each such company involved (a) together has outstanding loans, debentures or deposits not exceeding ₹200 crore, and (b) has not defaulted in repayment of any such obligations.

The compliance needs to be verified on two dates: a day not exceeding 30 days prior to serving of the notice under section 233(1)(a), and on the filing date of the scheme under section 233(2). A certificate of a specialist auditor in the new Form CAA-10A is to be submitted along with the sanctioned scheme to ensure fulfilment of these requirements. Two, mergers between a holding company (listed or unlisted) and a subsidiary company (listed or unlisted) are brought into scope, with a carve-out that the clause does not apply where the transferor company or companies are listed thereby retaining a fundamental investor-protection boundary. Three, mergers between subsidiaries of the same holding company are in order where the transferor companies or companies are not listed; the amendment supplies an example to explicate multi-tier subsidiary configurations and acceptable combinations.

Also, mergers of a foreign holding company incorporated outside India with its Indian wholly-owned subsidiary (the transferee) are specifically referred to by cross-referencing Rule 25A(5), thus bringing cross-border intra-group consolidations within the fast-track outlines where necessary. Thirdly, the procedural filings under sub-rule (2) and sub-rule (4) have also been streamlined. Following the words “Form No. CAA-10,” the amendment makes clear that CAA-10 is to be filed “as an attachment to Form GNL-1,” streamlining the e-filing route for the declaration of solvency. Additionally, in respect of post-meeting intimations, the transferee company is required, within 15 days of end of concerned meetings of members or classes of members or creditors or classes of creditors, to furnish (i) a copy of the approved scheme, (ii) the report of the outcome of each meeting, and (iii) the report of the registered valuer, in Form CAA-11 “as attachment to Form RD-1,” along with the fee as prescribed under the Companies (Registration Offices and Fees) Rules, 2014. Where a sectoral regulator or stock exchange has provided objections or suggestions as envisaged by the proviso to sub-rule (1), a statement detailing how they have been addressed shall be annexed with the scheme.

These amendments close the evidentiary and valuation link for the RD’s consideration and explicitly specify the form-to-form correlation to minimise procedural errors. Fourthly, a new sub-rule (9) now stipulates that the provisions of Rule 25 shall apply, mutatis mutandis, to any arrangement of division or transfer of an undertaking of a company mentioned in section 232(1)(b). In giving such orders, the Central Government can make provisions of the kind provided in section 232(3)(a) to (j), where applicable. This is a consequential but significant cross-reference: it guarantees that separations and transfers of undertakings when framed within the fast-track purview bear the same protectionist words (e.g., relating to property vesting, continuation of legal proceedings, dissolution, and incidental matters) that typically attend to tribunal-approved schemes under section 232. Lastly, Annexure-A to the Rules has been replaced to bring the statutory forms up to date. Revised Forms CAA-9 (notice inviting objections/suggestions), CAA-10 (declaration of solvency), CAA-11 (notice of approval of the scheme), and CAA-12 (confirmation order) are notified, and a new Form CAA-10A (auditor’s certificate for the new section 233(1A)(iii) threshold) is added.

The new forms provide for systematic columns for corporate identification numbers, mapping of transferor/transferee (incorporating small companies, WOS, start-ups, and foreign-holding/Indian-WOS combinations), nature of the scheme (merger/amalgamation or transfer/division of undertaking), and they place on record attachments like board resolutions, statements of assets and liabilities, and auditor’s report. The forms also incorporate the necessity of capturing approval mechanisms (dispatch dates, meeting dates, voting thresholds) for members and creditors, along with mandated declarations that section 233 requirements have been substantially complied with.

Conclusions

The 2025 changes to the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 redesign India’s speeded-up regime of mergers to accord with prevailing corporate trends, specifically intra-group amalgamations, lower-risk section 8–unlisted mergers under capped leverage, and defined cross-border alignments while maintaining regulatory visibility. By formalising sectoral-regulator and stock-exchange notice at the notice stage, making RD filing stack clear with a report of a registered valuer and clear e-form attachments, and requiring an auditor’s certificate for financial-cap levels, the regime is intended to minimise friction in compliant transactions and to sieve out schemes that must continue to be within the Tribunal’s supervisory field. Insertion of sub-rule (9) completes the transition between mergers and hiving-off of undertakings by bringing Rule 25’s apparatus to section 232(1)(b) situations with scope for safeguarding conditions analogous to section 232(3).

The amendments together should facilitate predictable, stakeholder-safe reorganisations, particularly among corporate groups, without weakening scrutiny when public-market or prudential concerns are at stake. Companies considering group sprucing, vertical mergers of subsidiaries, or class 8-unlisted mergers will find the RD pathway better defined, as long as they pass the objective financial tests, subscribe to the more expansive documentary set, and demonstrate a reasonable process by way of member/creditor approvals and valuation documentation now embedded in Rule 25 procedure.