Below FAQs seek to answer some common questions asked with reference to the following rules:
A. Companies (Creation and Maintenance of databank of Independent Directors) Rules, 2019
B. Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019
Response: Important Dates:
Response: Indian Institute of Corporate Affairs (IICA) as notified under sub-section (1) of section 150 of the Companies Act, 2013 shall create and maintain a databank of persons willing and eligible to be appointed as Independent Directors and also provide for online courses and self-assessment test.
Response: Every Individual –
Response: In accordance with Rule 3(2) of the Companies (Creation and Maintenance of databank of Independent Directors) Rules, 2019 the databank will include the information, such as, DIN/PAN, Full Name, Father’s Name, DOB, Gender, Nationality, Occupation, Address, Contact Details, Educational and Professional Qualifications, Experience or Expertise, details of pending criminal proceedings, and Directorship/KMP/LLP positions.
Response: In case of already compliant/registered Independent Directors, their DIR-3-KYC detail (such as, DIN/PAN/Password number, Name, DOB, Father’s name, Mobile Number and Email Address) and their directorship/KMP positions details will be automatically shared with the databank. All other information required for empanelment must be provided by the individual only.
Response: The information available in the databank shall be provided only to companies required to appoint independent directors after paying a reasonable fee to the institute.
Response: As per Rule 3 (4) of the said provisions, a person whose name is included in the databank, can control what information will be displayed or hidden in his/her profile.
Response: As per Rule 3(5) of the said provisions, any individual whose name appears in the databank must make changes in his particulars within thirty days of such change in the databank as well.
Response: Yes, there is a fee for inclusion of name with the databank. As per the Rule 3(7), the institute, with the prior approval of the Central Government has fixed fees for individual registration as below:
Response: As per Rule 6(4) of the Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019, “ the individual who has served for a period of not less than ten years as on 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. The exemption feature will be made available soon.
Response: As per Rule 6(4) of the Companies Appointment and Qualification of Directors) Fifth Amendment Rules, 2019, “for the purpose of calculation of the period of ten years referred to in the first provision, any period during which an individual was acting as a director or as a key managerial personnel in two or more companies at the same time shall be counted only once.
Response: Individuals not exempted are required to pass the basic self-assessment proficiency test within 1 year of their inclusion of name in the databank.
Response: As per Rule 6(4) of the Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019, every individual whose name is included in the databank under sub rule (1) shall pass an online proficiency self-assessment test conducted by the institute within a period of one year from the date of inclusion of his name in the databank, failing which, his name shall stand removed from the databank of the institute. This is subject to exemption allowed under the rule for individuals meeting the required experience criteria.
Response: As per the explanation provided for Rule 6 (4) of the Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019 “an individual who has obtained a score of not less than sixty percent in aggregate in the online proficiency self assessment test shall be deemed to have passed such test”.
Response: The individual whose name is included in the databank does not possess the minimum years of experience as provided in Rule 6 (4) of Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019 shall be required to pass the online proficiency self assessment test.
However, if such individual upon attainment of such experience during the course of the year or any time later will be exempted to take the test from the date of attaining such minimum years of experience as provided in the Rule 6 (4) of the said amendment of Rules.
Response: It is not mandatory to take the eLearning courses; however, it is advisable to take the courses for the purpose of capacity building as well as for ease of passing the online proficiency self-assessment test.
Response: Yes, all empaneled individuals will be able to access and take the self-assessment test. However, it will be mandatory non-exempted individuals to pass the test within one year of inclusion of their name in the databank.
Response: Yes, individuals can make multiple attempts for self-assessment even after passing it with minimum score of 60%.
Response: Prefilled data coming from MCA21, cannot be modified. In order to change any particulars of Directors, you are required to file Form DIR-6 or DIR 3 KYC with MCA.
Response: In that case, you are required to file Form DIR-6 or DIR 3 KYC with MCA in order to change the email-id particulars.
Response: Fill up the DIR 3-KYC & DIR-6 for correction of dates.
Response: In that case, you are required to file DIR-6 or DIR 3 KYC with MCA in order to change the email-id and receive the required OTP.
Response: As per Section 149(6) of Companies Act 2013
(6) An independent director in relation to a company, means a director other than a managing director or a whole-time director or a nominee director,—
(a) who, in the opinion of the Board, is a person of integrity and possesses relevant expertise and experience;
Any individual with relevant expertise and experience, aspiring to be an Independent Director may register with databank.
Therefore, an individual not being a graduate may also register with databank.
Response:There is no minimum or maximum age limit for registration as an Independent Director with databank.
Response: In that case, you are required to file form DIR-6 or DIR-3 KYC with MCA in order to change the company email to your personal email-id.
Response: No, passing of post assessment quizzes is not mandatory. The post assessment quizzes at the end of each module are only to check learner’s retention.
Response: The online self-assessment test is based on the 42 eLearning modules available within the integrated LMS in the databank, they can be accessed after login to your dashboard.
Response: The empanelment/registration fee can be paid online using the credit card, netbanking, UPI and Digital wallet (only mobikwik). As per Government of India’s instruction, the option for paying through the debit card is currently not available.