Disclosure on the website by Public Unlisted Company

The Companies Act 2013 mandates that certain information be published on a company’s website. Information like company name, registered office address, company identification number, telephone number, fax number, email ID, and name of a company representative in case of any complaints/queries. The company’s web address must appear on letterhead, business letters, billheads, stationery, and official publications and announcements. Under the Companies Act 2013 it is not mandatory for companies to have a website, in the case of a listed company the Securities and Exchange Board (SEBI) made it mandatory for companies to have an updated website in April 2011.
In this article, let us have a look at the mandatory website disclosures under the Companies Act 2013.

Website disclosures under the Companies Act 2013

Life in the digital world is crucial for every business. Websites can be used to implement many different marketing strategies to help your business grow. The web has a much reach than other forms of advertising. Having a website and online presence strategy will allow you to promote your business online.

Companies that have their websites are required to follow certain provisions and compliances regarding website posting. They must comply with the Companies Act, 2013, and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. In particular, companies doing business online or otherwise are compulsorily required to disclose or publish certain information.

Does the Companies Act 2013 require a company to have a website?

The Companies Act 2013, Rules or Notifications issued under the Companies Act 2013 do not mandate companies to have their website. However, for listed companies, the Securities and Exchange Board of India (SEBI) has made it mandatory to maintain functional and updated websites with effect from April 2011.

The following laws govern the mandatory disclosure of information on the company’s website:

• The Companies Act, 2013 and its rules
• SEBI Listing (Obligations and Disclosure Requirements) Regulations, 2015
• SEBI (Prohibition of Insider Trading) Regulations, 2015

In addition, according to secretarial standards, the following must be displayed on the company’s website:

• Postal Ballot Notice
• The results of the poll

Why is website disclosure required?

Every company has an online presence in the present era. However, some website disclosures are still a mystery to various business owners. There are also several disclosures that different types of businesses must make. Hence, the need for website publishing arises.

Disclosure on websites for public companies

In addition to the mandatory information for a private company, a public company must also disclose the following:

• Notice of the change of objects for which money is raised by prospectus under Rule 32 of Chapter II of the Companies (Incorporation) Rules 2014 must be published on the website.
• A copy of the circular inviting public contributions must be on the company’s website.
• Information on closing the register of members or holders of bonds or other holders of securities.
• Notice of voting by mail.
• The results of the postal vote together with the scrutineer’s report must be published.
• The details of setting up the vigilance mechanism must also be published on the website.
• The appointment of independent directors must also be published on the website.

Mandatory disclosures under the Companies Act 2013

• The web address on all its official publications such as business letters, billheads, notices, etc.
• Notice of the change in objects for which money is raised by prospectus under Rule 32 of Chapter II of the Companies Rules, 2014 must be published on the website.
• Annual return details.
• Details of the vigil mechanism.
• CSR and the company’s policy on the appointment and remuneration of directors.
• Independent Director Terms.
• Closing of the register of members or bondholders.
• Notice of the general meeting.
• Notification of voting by electronic means.
• Postal Ballot Notice.
• Special notice, if any.
• Delete company details name.
• Details of outstanding dividend.
• Call for deposits.
• Director resignation details, if any.

Consequences of Non-Compliance Website Disclosure

As such, there are no penalties for not complying with website disclosure requirements. But under Section 450 of the Companies Act, 2013, the penalty for non-compliance by the company or any officer of the company who fails to comply with any of the provisions of the Act will be Rs.10,000. For continued violations, there will be an additional penalty of Rs 1,000 for each day of delay. This will cover default confidentiality, the company must take care to publish all relevant information on the website.

Final words

Compliance is an important part of work in large corporations. Website publishing is also one of the primary tools for better company management. However, such compliance under the Companies Act 2013 is an ongoing process and not a one-off affair. In addition, we provide regular follow-ups with our clients regarding the company’s compliance calendar. For more information and consultation, visit Legal Window or email us.