New Delhi: Individuals, partnership entities as well as companies can act as valuers under the Companies Act after getting registered with an authority specified by the government, says a notification.
The corporate affairs ministry has proposed to specify the Insolvency and Bankruptcy Board of India (IBBI) as the authority with respect to registration, recognition and ancillary matters related to valuers.
The Companies (Registered Valuers and Valuation) Rules, 2017 have been notified by the ministry. The rules provide for registration of valuers under the Companies Act, 2013.
"The valuers, who may be individuals or partnership entities or companies, would be required to be registered with the authority specified by the central government. The rules provide for registration of different category of valuers and lay down the requirements on their eligibility, qualifications and experience," an official release said on Friday.
With the notification of the rules, Section 247 pertaining to valuation by registered valuers came into effect from October 18. Those entities, which are already carrying out valuation activities, have time till March 31, 2018 to get registered with the specified authority.
"During this transition period any person who may be rendering valuation services under the Companies Act, 2013 may continue to render such services without getting registered under the rules," the release said.
The mechanism to prescribe valuation standards and syllabus for conduct of valuation education courses as well as specify the requirements with regard to the contents of the valuation report have been laid out in the rules.
Among other requirements, the registered valuers have to be members of the Registered Valuers Organisations (RVOs), recognised by the authority.
The RVOs have to comply with certain norms including an internal governance structure that "should provide for enforcement of a code of conduct on the registered valuers, training and conduct of educational courses for the valuation of specific asset classes for which the RVO concerned is recognised", the release said.
The relevant notification to specify IBBI as the authority with regard to valuers under Section 458 would be issued separately, it added.
A registered valuer would carry out valuation in respect of any property, stocks, shares, debentures, securities or goodwill or any other assets or net worth of a company or its liabilities, as per chapter XVII of the Companies Act.