Japan Newsletter (October - December 2025)

パートA：分野別アップデート

1. 医療機器調達でインド国内ライセンスを技術要件として義務化
   中央医薬品標準管理機構（CDSCO）は、公共病院など全ての調達機関に対し、2017年医療機器規則に基づく医療機器について、有効なインド国内の製造ライセンスまたは輸入ライセンスを技術要件として必須化するよう指示しました。
    
2. 石炭火力でのバイオマス混焼政策を改定、対象燃料を拡大
   電力省は、石炭火力発電所におけるバイオマスペレットと、都市固形廃棄物由来の焙焼炭（トレファイド炭）の混焼を認める改定政策を発出しました。対象となる燃料は、従来の農業残渣ペレットに加えて都市固形廃棄物から製造される焙焼炭にまで拡大しました。
    
3. レアアース永久磁石の国内製造促進スキームを導入
   重工業省は、焼結レアアース永久磁石の製造エコシステムをインド国内で初めて確立することを目的としたスキームを導入しました。電気自動車、再生可能エネルギー、電子機器、航空宇宙、防衛といった重要分野を支えるため、国内生産能力として年産6,000MTを目標に掲げている。
    
4. Petroleum and Natural Gas Rules, 2025を公布
   石油・天然ガス省は、石油・天然ガス規則2025を公布した。新規則は、探鉱・開発・生産について排他的権利を付与する統合型の石油リース（unified petroleum lease）を導入する。さらに、油田の経済的寿命まで柔軟に設定できる存続期間、運用データの所有権の中央集約、温室効果ガスの監視と削減の義務化、ならびにリース保有者間でのインフラ共同利用に関する規定を設けた。
    
5. 議会、原子力エネルギーの法的枠組み刷新法案を可決
   インド議会は、持続可能な原子力エネルギー開発法案2025を可決し、1962年原子力法および2010年原子力損害賠償法を廃止した。同法案は、インドの民間事業体および合弁会社による原子力発電と燃料取扱いへの参入（ライセンス付与）を可能にした。また、機器の欠陥に起因する責任について、運転者による求償権を排除、炉容量に応じた段階的な責任枠組みを導入し、原子力規制委員会（Atomic Energy Regulatory Board）に法定の地位を付与した。
    

パートB：一般アップデート

1. RBI、銀行による金融サービス実施に関する指針を改正
   インド準備銀行（RBI）は、商業銀行による金融サービス実施指針を改正した。改正により、グループレベルの貸出枠組みに、銀行グループ内のノンバンク金融会社および住宅金融会社が含まれることとなった。併せて、代理店業務、グループ事業体、紹介サービスに関する主要定義を導入し、「1事業1主体（one business–one entity）」原則を通じて組織構造上の要件を強化した。
    
2. RBI、NOFHC指針を改正し銀行グループ活動を再編
   インド準備銀行は、非業務執行型金融持株会社（NOFHC）指針を改正した。改正では、Banking Regulation Act, 1949の下で認められる中核的な銀行業務は、銀行のみが実施する一方で、投資信託、保険、年金、投資助言、ポートフォリオ管理、仲介業務などの所定の金融サービスは、NOFHCが保有する事業体を通じて実施しなければならないとされた。
    
3. SEBI、LODR規則を改正し関連当事者取引の監督を精緻化
   インド証券取引委員会（SEBI）は、インド証券取引委員会（LODR）（第5次改正）規則を交付し、関連当事者取引（RPTs）に関する基準を改定した。この改正では、上場会社の連結売上高に連動した、スライディング・スケール（規模別）による重要性閾値を導入した。さらに、上場会社が当事者でない場合であっても、子会社が関与する重要なRPTについては、事前に監査委員会の承認を求めた。また、少額免除を設け、約111,173米ドル未満の取引は監査委員会の承認対象から除外した。
    
4. 印紙未貼付・未登録の売買契約に基づく仲裁打ち切りをデリー高裁が支持
   デリー高等裁判所は、未登録かつ印紙未貼付の売買契約に基づいて開始された仲裁について、仲裁手続の終了を支持した。同裁判所は、かかる印紙未貼付かつ未登録の契約は、法的な強制執行力を持たないと判断した。
    
5. 統合労働法典を施行、29本の中央労働法に代替
   労働雇用省は、4本の統合労働法典の施行を通知し、29本の中央労働法を廃止した。新法典は施行済みだが、全面的な運用開始は、現在草案段階にある中央政府および州政府による実施規則の制定を通知を待って決定される。
    
6. デジタル個人データ保護規則を施行
   インドは、2023年デジタル個人データ保護法（DPDP法）に基づき、2025年デジタル個人データ保護規則を通知し、包括的なデジタル個人データ保護制度を運用開始した。規則は全面施行されており、データ受託者（Data Fiduciaries）に対し、目的制限、子供のデータに関する親権者の同意、DPDP法に基づくデータ侵害通知の義務化など、厳格なコンプライアンス義務を課している。
    
7. Companies Actの「小会社」定義を改定、閾値を引き上げ
   MCAは、「小会社（small company）」の定義を改正し、払込資本金および売上高の閾値を閾値を250%引き上げ、払込資本金と売上高の基準をそれぞれ約111,146米ドル、約1,110万米ドルとした。これにより、証券の電子化義務の免除を含む、規制緩和の対象範囲が拡大する。
    
8. 議会、保険法改正でFDIを自由化
   議会は、保険法改正法案2025（Sabka Bima Sabki Raksha）を可決した。同法案は、保険会社への外国直接投資（FDI）を最大100%まで認める。さらに、保険会社および仲介事業者のコンプライアンスを緩和する。

Section A: Sector Updates

(1) Central Drugs Standard Control Organisation (CDSCO) mandates Indian licence as technical requirement for medical device procurement

CDSCO directed all procurement agencies, including public hospitals and institutions, to require a valid Indian manufacturing or import licence for medical devices under the Medical Devices Rules, 2017.

(2) Revised policy on co-firing of biomass in coal-based thermal power plant

Ministry of Power issued revised policy permitting co-firing of biomass pellets and municipal solid waste-based torrefied charcoal in coal-based thermal power plants, expanding eligible fuels beyond agro-residue pellets to include torrefied charcoal produced from municipal solid waste.

(3) Scheme to promote domestic manufacturing of rare earth permanent magnets

Ministry of Heavy Industries introduced a scheme to establish India’s first manufacturing ecosystem for sintered rare earth permanent magnets with the aim to build 6,000 (six thousand) metric tonnes per annum of domestic capacity to support critical sectors such as electric vehicles, renewable energy, electronics, aerospace, and defence.

(4) Petroleum and Natural Gas Rules, 2025 notified

Ministry of Petroleum and Natural Gas notified the Petroleum and Natural Gas Rules, 2025, replacing the Petroleum and Natural Gas Rules, 1959. The new rules introduce a unified petroleum lease with exclusive rights for exploration, development, and production, flexible tenure up to the economic life of an oilfield, centralised ownership of operational data, mandatory greenhouse gas monitoring and reduction, and provisions for shared infrastructure among lessees.

(5) Parliament passes Bill to overhaul nuclear energy legal framework

The Indian Parliament passed the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Bill, 2025 (Bill), replacing the Atomic Energy Act, 1962 and the Civil Liability for Nuclear Damage Act, 2010. The Bill allows licensing of Indian private entities and joint ventures for nuclear power generation and fuel handling, removes operator recourse for liability arising from defective equipment, introduces a tiered liability framework based on reactor capacity, and grants statutory status to the Atomic Energy Regulatory Board.

Section B: General Updates

(1) Reserve Bank of India (RBI) amends directions on undertaking of financial services by banks

The RBI notified certain amendments to the Commercial Banks – Undertaking of Financial Services Directions which inter alia expand the group-level lending framework to include non-banking finance companies (NBFCs) and housing finance companies (HFCs) within bank groups, introduce key definitions for agency business, group entities, and referral services, and strengthen structural requirements through a “one business–one entity” principle.

(2) RBI amends Non-Operative Financial Holding Company (NOFHC) Directions to restructure bank group activities

The RBI notified amendments to the NOFHC Directions requiring all core banking activities permitted under the Banking Regulation Act, 1949 to be undertaken only by the bank, while specified financial services such as mutual funds, insurance, pensions, investment advisory, portfolio management, and broking must be carried out through NOFHC-held entities.

(3) Securities and Exchange Board of India (SEBI) amends Listing Obligations and Disclosure Requirements (LODR) Regulations to refine oversight of related party transactions (RPTs)

SEBI notified the SEBI (LODR) (Fifth Amendment) Regulations, 2025, introducing revised norms for RPTs. The amendments establish a scale-based materiality threshold linked to the listed entity’s consolidated turnover to determine material RPTs. They also require prior audit committee approval for significant RPTs involving subsidiaries, even where the listed entity is not a party. A small value exemption has been introduced, excluding transactions below approximately USD 111,173 from audit committee approval requirements.

(4) Arbitration validly terminated due to unregistered and unstamped sale agreement

The High Court of Delhi upheld the termination of arbitral proceedings where the arbitration was founded on an unregistered and unstamped agreement to sell, holding such an unstamped and un-registered agreement unenforceable.

(5) Implementation of consolidated labour codes

Ministry of Labour and Employment notified the implementation of the 4 (four) consolidated labour codes, replacing 29 (twenty-nine) central labour laws. While the new codes are now in force, their full operational impact is subject to notification of rules (which are currently in draft stages) by the central and state governments.

(6) Digital Personal Data Protection Rules brought into force

India operationalised its first comprehensive digital personal data protection regime with the notification of the Digital Personal Data Protection Rules, 2025 under the Digital Personal Data Protection Act, 2023 (DPDP Act). The rules are fully operational and impose strict compliance obligations on data fiduciaries, including purpose limitation, parental consent for children’s data, and mandatory breach notifications under the DPDP Act.

(7) Definition of ‘small company’ revised under Companies Act

MCA has amended the definition of a ‘small company’ by increasing the paid-up share capital and turnover thresholds by 250% (two hundred and fifty percent) to approximately USD 111,146 and USD 11.1 million respectively. The revision expands the scope of companies eligible for reduced compliances and exemptions, including relief from mandatory dematerialisation of securities.

(8) Parliament passes insurance law reforms to liberalise FDI

Parliament passed the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill, 2025. This bill permits up to 100% (one hundred percent) FDI in insurance companies and inter alia eases compliance for insurers and intermediaries.

Central Drugs Standard Control Organisation (CDSCO) asks procurement agencies to mandate Indian license as technical requirement

On November 17, 2025, the CDSCO issued a circular, that all medical devices procured in India must mandatorily hold a valid license issued under the Medical Device Rules, 2017, either by the CDSCO or the relevant State licensing authority. The circular clarified that hospitals insisting on certifications such as the USFDA/CE certification cannot be held as a valid substitute for the statutory Indian licensing requirements, and procurement of an Indian statutory license is mandatory.[1]

Maha MedTech Mission launched by Anusandhan National Research Foundation (ANRF)

On October 25, 2025, the ANRF, in collaboration with the Indian Council of Medical Research (ICMR) and the Gates Foundation, launched the Mission for Advancement in High-Impact Areas Medical Technology (Mission), aimed at accelerating innovation in India’s medical technology sector, reducing dependence on high-cost imports, and improving access to affordable and high-quality healthcare technologies.[2]

The Mission provides milestone-linked funding ranging from USD 551,752 to approximately USD 2.7 million per project, extendable up to approximately USD 5.5 million in exceptional cases, and is open to academic and research and development institutions, hospitals, startups, MSMEs, MedTech companies, and collaborative consortia. The initiative seeks to support projects that translate high-impact MedTech innovations into market-ready solutions. The key objectives of the Mission include driving public health impact by addressing priority disease areas, ensuring affordability and accessibility of medical technologies, and enhancing self-reliance and global competitiveness through indigenous development, manufacturing, and industry–academia collaboration. The scope of the Mission spans a wide range of medical devices and in-vitro diagnostics, including diagnostic imaging, minimally invasive and assistive devices, implants, consumables, software-based solutions, and emerging areas such as artificial intelligence/machine learning enabled platforms, robotics, point-of-care diagnostics, and technologies aligned with national health priorities such as tuberculosis, cancer, neonatal care, and primary healthcare.

In addition to financial support, the Mission offers enabling ecosystem assistance through initiatives such as Patent Mitra (intellectual property protection and technology transfer), MedTech Mitra (regulatory guidance), access to a clinical trial network for validation, and mentorship from industry experts. The application process follows a 2 (two) stage model. Concept notes may be submitted between September 15, 2025, and November 7, 2025, through the ANRF portal, with shortlisted applicants invited to submit full proposals starting December 2025. 

Policy regarding co-firing of biomass in coal-based plants

On November 07, 2025, Ministry of Power (MoP) released a revised policy regarding use of biomass pellets in coal-based thermal plants for co-firing. Co-firing is the simultaneous combustion of 2 (two) or more different fuels in the same power plant to produce energy. Key features of the policy include:

(i) Inclusion of municipal solid waste (MSW) based torrefied charcoal: Earlier policies mandated co-firing of biomass pellets made primarily from agro residue. The new policy explicitly adds torrefied charcoal produced from MSW as an eligible fuel for co-firing in coal-based thermal power plants. Torrefied charcoal is produced by heating a biomass such as MSW in a low-oxygen environment.

(ii) Differentiated targets for national capital region (NCR) plants: The new policy introduces region-specific mandates from financial year 2025-26. Plants in the NCR must use a 5% (five percent) blend of biomass pellets plus an additional 2% (two percent) blend of biomass pellets and/or MSW-based torrefied charcoal (by weight). Plants outside NCR must co-fire at least 5% (five percent) biomass pellets and/or MSW-based torrefied charcoal.

(iii) Use of crop residue: For plants in NCR and adjoining areas, at least 50% (fifty percent) of the raw material used in biomass pellets must now be rice paddy or crop residue sourced from NCR and adjoining districts. This sourcing requirement was not present in earlier policies.

The Petroleum and Natural Gas Rules, 2025 notified

On December 09, 2025, the Ministry of Petroleum and Natural Gas (MoPNG) notified the Petroleum and Natural Gas Rules, 2025 (Rules) under the Oilfields (Regulations and Development) Act, 1948.[3] The Rules, which are effective from December 09, 2025 replace the Petroleum and National Gas Rules, 1959 and provide a revised framework for regulation of oilfields and development of mineral oil resources including the manner of issuing licences and leases with respect to petroleum and natural gas, and rights and obligations of licence/lease holders. Key features of the Rules include:

(i) Petroleum lease: Petroleum lease will be granted by: (a) the State Government for mineral oil underlying land within its jurisdiction; and (b) the Central Government for resources in offshore areas. The lease will provide exclusive right to explore, develop, and produce mineral oils. Earlier, separate concessions were issued for exploration and production. A lease will be valid for a period between 4 (four) years and 30 (thirty) years. The lease may be extended till the end of economic life of the oilfield, in one or more instalments. The lessee may also undertake activities such as exploration and generation from renewable energy sources, and exploration and production of hydrogen in the leased area.

(ii) Rights with respect to data: All data obtained as a result of operations will be the property of the central government. A lessee will have the right to use data free of cost and retain for its own purposes. The central government may disclose data to public, other than any data held to be proprietary.

(iii) Greenhouse gas emissions: Every lessee will be required to monitor and reduce greenhouse gas emissions. Lessees may undertake projects for geological storage of emissions within the leased area, after obtaining authorisation from the central government.

(iv) Sharing of infrastructure: Two or more lessees may jointly develop or share infrastructure facilities, as per mutually agreed terms and conditions.

Bill to modify the legal framework for nuclear energy passed

On December 20, 2025, the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Bill, 2025 (Bill) was passed by Parliament.[4] The Bill replaces the Atomic Energy Act, 1962 (1962 Act) and the Civil Liability for Nuclear Damage Act, 2010 (2010 Act). The 1962 Act provided for the development and use of atomic energy, and the 2010 Act provided a framework for assigning liability and compensation in case of a nuclear incident. Key changes include:

(i) Licence to non-government entities: The 1962 Act permitted only central government entities or companies to mine atomic minerals or produce nuclear energy. The Bill now empowers the Central Government to issue licences to Indian private companies or their joint ventures with government entities for generating nuclear energy and handling nuclear fuel.

(ii) Operator’s right of recourse: The 2010 Act gave operators a legal right to recover some or all of the compensation paid. This right could be exercised: (a) when such rights are provided in a contract; (b) where the incident arises due to the supply of defective equipment or materials; and (c) when the incident is caused by a deliberate act with the intent to cause damage. The Bill removes the ground of supply of defective equipment or materials.

(iii) Liability for nuclear damage: The 2010 Act specified a maximum liability of the operator at approximately USD 166.5 million for a nuclear reactor with thermal power capacity of 10 MW (ten megawatts) or above. The Bill specifies a tiered structure, with liability limits ranging from approximately USD 11.1 million to approximately USD 333 million based on power capacity.

For instance, the operator’s liability for reactors having thermal power up to 150 MW is capped at approximately USD 11.1 million. For reactors with thermal power above 150 MW and up to 750 MW, the liability limit increases to approximately USD 33.3 million, with progressively higher caps prescribed for higher capacity reactors. In the case of reactors having thermal power exceeding 3,600 MW (three thousand six hundred megawatts), the operator’s liability is capped at approximately USD 333 million.

(i) Atomic Energy Regulatory Board (AERB): The Bill provides statutory recognition to the AERB. The Board will take measures to ensure safe use of radiation and nuclear energy.

Guidelines for Virtual Power Purchase Agreements notified[5]

On December 24, 2025, the Central Electricity Regulatory Commission (CERC) notified guidelines for virtual power purchase agreements (VPPAs). A VPPA is a financial settlement contract that is executed between the generator and the consumer outside of the power market, without involving any physical delivery of electricity generated. These agreements are intended to help designated consumers meet their renewable energy consumption obligation (RCO). This obligation was introduced through an amendment to the Energy Conservation Act, 2001 in 2022. It requires designated consumers to source a minimum percentage of electricity requirement from non-fossil sources. Designated consumers include distribution companies, open access consumers (who procure electricity directly from generators), and captive users (who generate electricity for their own use).

Currently, RCO may be fulfilled by: (i) utilising electricity from non-fossil sources; or (ii) purchasing renewable energy certificates (RECs) from generators through competitive bidding on power exchanges. RECs are issued to generators for supplying electricity from renewable sources. Key features of the guidelines include:

(i) Design of VPPA: A VPPA is intended to be a bilateral contract between a renewable energy generating station (REGS) and a designated consumer for at least 1 (one) year on mutually agreed terms and conditions. REGS shall be allowed to sell the electricity component through power exchange or any other mode authorised under the Electricity Act, 2003, or the Power Market Regulations, 2021, and such sale shall be for purposes other than for RCO compliance. The RECs received thereby shall be transferred to the designated consumer who can use such RECs for RCO compliance

The VPPA for RCO compliance shall be non-tradable and non-transferable, and the contracting parties shall be bound by the contract terms for the entire period of the contract. In case of a change of ownership, the responsibilities of REGS under the VPPA shall be transferred, as per applicable laws.

(ii) Payment terms: The generator and the designated consumer will decide a mutually agreed price. Difference between the price realised through sale and the pre-agreed price will be settled bilaterally in accordance with agreed terms and conditions.

(iii) Dispute settlement: The guidelines specify that a dispute will be mutually settled as per the contract

Scheme for promotion of manufacturing of rare earth magnets introduced

On November 26, 2025, the Ministry of Heavy Industries introduced a scheme to promote manufacturing of sintered rare earth permanent magnets (REPM).[6] Key features of the scheme are as follows:

(i) Objective: The scheme aims to establish India’s first REPM manufacturing ecosystem with a total capacity of 6,000 (six thousand) metric tons per annum (MPTA) to strengthen self-reliance in critical inputs for electric vehicles, renewable energy, electronics, aerospace, and defence sectors.

(ii) Financial outlay: The scheme has a total financial outlay of approximately USD 809.34 million, with sales linked incentives of approximately USD 717.07 million on the sale of REPMs for a period of 5 (five) years, and a capital subsidy of approximately USD 83.38 million for setting up integrated manufacturing facility. The incentives are designed to encourage domestic production across the entire value chain, from rare earth oxides to finished magnets.

(iii) Implementation: The scheme will be implemented through a global competitive bidding process, under which 5 (five) beneficiaries will be selected and allocated up to 1,200 (one thousand two hundred) MTPA capacity each. The total duration of the scheme is 7 (seven) years from the date of award, including a 2 (two) year gestation period for setting up the manufacturing facilities and a 5 (five) year period for disbursement of sales-linked incentives.

Foreign Exchange Management (Borrowing and Lending) Regulations, 2018

On October 06, 2025, the RBI issued the Foreign Exchange Management (Borrowing and Lending) (Amendment) Regulations, 2025. Pursuant to such amendment, the authorised dealer banks (AD Banks) are allowed to lend in Indian Rupees to a person resident outside India being individuals and banks in Bhutan, Nepal, and Sri Lanka for cross-border trade transactions.

Amendments regarding undertaking of financial services

The RBI by notification dated December 5, 2025, has issued the Reserve Bank of India (Commercial Banks – Undertaking of Financial Services) (Amendment) Directions, 2025 (Amended Directions), amending the Reserve Bank of India (Commercial Banks – Undertaking of Financial Services) Directions, 2025 (Directions). The Amended Directions came into effect with immediate effect from December 5, 2025.

(i) Expansion of scope for lending through group entities: The Amended Directions extend the applicability of paragraph 18(4) of the Directions (which prescribes conditions that are applicable to banks where lending business is undertaken through a group entity) to all non-banking financial companies (NBFCs) and housing finance companies (HFCs) that form part of a bank group. Key compliances include stipulations on advances, and limits per borrower for loans and advances against shares, debentures and bonds and Indian depository receipts, initial public offering financing and employee stock ownership plan financing.

(ii) Key definitions introduced:

(a) ‘Agency Business’ are defined as an arrangement under which a bank or its group entity acts as an agent of a third-party product or service provider (TPPSP), without risk participation, to facilitate the sale of regulated financial products or services. Activities may include marketing, sales, promotion, acting as the initial point of contact for grievance redressal, and after-sales services.

(b) ‘Group Entity’ are defined to include subsidiaries, joint ventures, and associates of a bank. Entities held under a non-operative financial holding company (NOFHC) are expressly excluded from being treated as group entities for the purposes of the Amended Directions.

(c) ‘Referral Services’ are clarified to permit banks to refer customers to TPPSPs by sharing information regarding regulated products or services, subject to conditions. Banks are restricted from participating in TPPSP processes, permitting use of bank branding in TPPSP documents, or integrating TPPSP processes into bank platforms or premises, except through a simple redirect link.

(iii) Departmentalisation and business structuring requirements: All core banking activities under sections 5(b) and 6(1) of the Banking Regulation Act, 1949 (Act) are required to be undertaken either departmentally or through a group entity established under section 19 of the Act. The business of banking and acceptance of time deposits must be undertaken only departmentally, with a limited exception permitting acceptance of time deposits by an HFC where specifically allowed. The Amended Directions introduce a ‘one business–one entity’ requirement across a bank group, subject to board-approved rationale for deviations. Where lending activities are undertaken through NBFC or HFC group entities, such entities are required to comply with regulations applicable to ‘Upper Layer NBFCs’ (excluding listing requirements) and certain lending restrictions that were earlier applicable only to banks. Banks that are not in conformity with the Master Directions are prohibited from undertaking any new business in the relevant segment from April 1, 2026, and are required to submit a compliance status by March 31, 2026. Existing facilities may continue until their respective maturities. Certain financial services, including mutual fund operations, insurance activities, pension fund management, investment advisory services, portfolio management services, and broking, are required to be undertaken only through separate group entities and not departmentally.

(iv) Investment framework: The Amended Directions revise investment limits and conditions applicable to banks and bank groups, including investments in group entities, non-financial entities, asset reconstruction companies, and alternate investment funds, real estate investment trusts, and infrastructure investment trusts. Reporting of breaches of investment limits through the ‘PRAVAAH’ portal within 15 (fifteen) days is mandated. Banks not compliant with the revised investment norms are required to submit an action plan by March 31, 2026, and achieve full compliance by March 31, 2028.

Amendment to NOHFC Directions

The RBI, by notification dated December 5, 2025, issued the RBI (Non-Operative Financial Holding Company) (Amendment) Directions, 2025, amending the Reserve Bank of India (Non-Operative Financial Holding Company) Directions, 2025 (Master Directions for NOFHC). The amended directions came into effect with immediate effect.

The amended directions prescribe revised provisions governing the organisation of business activities within a bank group operating under an NOFHC structure. An NOFHC is a non-operating holding company, mandated under the RBI’s licensing framework for banks and governed by directions issued under the Reserve Bank of India Act, 1934, which holds the bank and other regulated financial services entities and does not itself undertake business activities, except as permitted by the RBI.

Under the substituted provisions, all activities permitted to a bank under section 6(1)(a) to (o) of the Banking Regulation Act, 1949 (covering core banking and related activities) are required to be undertaken by the bank itself. Certain specified financial services, i.e., mutual fund business, insurance business, pension fund management, investment advisory services, portfolio management services and broking services, are required to be undertaken only through a subsidiary, joint venture or associate held by the NOFHC, and can be carried out without prior approval of the RBI provided that the RBI is intimated within 15 (fifteen) days of the board resolution passed for undertaking such business.

For undertaking any form of business (other than those listed above), prior approval of the RBI is mandatory. The amended directions further clarify that activities not permitted to be undertaken by a bank shall likewise not be permitted to be undertaken by entities held under the NOFHC.

Amendments to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (LODR Regulations)

On November 19, 2025, SEBI introduced amendments to the LODR Regulations by way of SEBI (Listing Obligations and Disclosure Requirements) (Fifth Amendment) Regulations, 2025 (Amendment Regulations).[7] Key highlights of the Amendment Regulations are as follows:

(i) Materiality Thresholds: A scale-based threshold mechanism has been introduced under schedule XII to classify a related party transaction (RPT) entered into by a listed company as material, where such transaction, either individually or taken together with previous transactions during a financial year, exceeds the prescribed threshold as set out below:

(ii) Significant RPTs: All RPTs shall require prior approval of the audit committee of the listed entity where such RPTs (entered into individually or taken together with previous transactions during a financial year) are transactions to which a subsidiary of the listed entity is a party, but the listed entity itself is not, and exceed: (a) 10% (ten per cent) of the annual standalone turnover of the subsidiary, as per the last audited financial statements of the subsidiary; or (b) the threshold for material related party transactions applicable to the listed entity, as specified in schedule XII of LODR Regulations.

The threshold for significant RPTs is subject to an exemption for small-value transactions based on an absolute monetary limit of approximately USD 111,173. Accordingly, where a transaction between a subsidiary and a related party (of the listed entity or the subsidiary), on an aggregate basis, does not exceed approximately USD 111,173, such transaction is not required to be placed before the Audit Committee of the listed entity for approval, even if the above thresholds are otherwise breached.

Arbitration clause valid despite naming a disqualified arbitrator

On October 7, 2025, the Supreme Court of India (SC) in Offshore Infrastructures Limited v. M/s Bharat Petroleum Corporation Limited held that the statutory disqualification of a named arbitrator does not render the underlying arbitration agreement invalid or inoperative. The SC opined that while an arbitrator may become ineligible under section 12(5) Arbitration and Conciliation Act, 1996 (Arbitration Act) due to his relationship with the parties to, counsel of, or subject-matter, of the dispute, the arbitration clause itself shall continue to remain enforceable. The SC also observed that arbitration clauses often reflect a clear intention of the parties to resolve disputes through arbitration, and such intent cannot be defeated merely because the named arbitrator is rendered ineligible due to subsequent statutory amendments.

The SC held that section 12(5) operates to ensure neutrality and independence of arbitrators but does not extinguish the parties’ agreement to arbitrate. Instead, in such situations, courts are empowered to appoint a neutral and independent arbitrator, thereby preserving the efficacy of the arbitral process.

Valid termination of arbitration based on unregistered and unstamped sale agreement

On October 15, 2025, the Delhi High Court in Gaurav Aggarwal v. Richa Gupta upheld the termination of arbitral proceedings under section 32(2)(c) of the Arbitration Act, holding that an arbitration founded on an unregistered and unstamped agreement to sell is unsustainable. The High Court observed that the agreement to sell (ATS) forming the basis of the dispute related to the transfer of sub-leasehold rights in immovable property and therefore constituted a contract for sale under section 54 of the Transfer of Property Act, 1882. As a result, the ATS was required to be compulsorily registered and duly stamped under the Registration Act, 1908 and applicable stamp laws in Uttar Pradesh, India. Since the ATS was neither registered nor stamped, the Court held that it was unenforceable in law and could not be relied upon to sustain arbitral proceedings. The arbitral tribunal was therefore justified in terminating the arbitration under section 32(2)(c) on the ground that continuation of proceedings had become legally impossible.

Limitation period not extended due to typographical errors in an arbitral award

On October 8, 2025, the Delhi High Court in M/s TEFCIL Breweries Ltd. v. M/s Alfa Laval India Pvt. Ltd. held that mere correction of typographical or clerical errors in an arbitral award does not extend the limitation period for filing a challenge under section 34 of the Arbitration Act. The court observed that the arbitral tribunal had delivered its original award on October 17, 2017, followed by an additional award on May 18, 2018, and subsequently carried out minor clerical corrections. Rejecting the contention that limitation would commence from the date of receipt of the corrected copy, the Court held that where a section 33 application has been filed, the limitation under section 34(3) begins from the date of disposal of such application, irrespective of later clerical corrections. The court clarified that corrections which are purely typographical and do not alter the substance or reasoning of the award cannot be treated as fresh or revised awards so as to reset the limitation clock.

Arbitral award may be set aside by mutual consent

On October 17, 2025, the Delhi High Court in M/s Oyo Hotels and Homes Pvt. Ltd. & Anr. v. M/s Ashiana Manufacturing India Ltd. held that an arbitral award may be set aside by the court with the mutual consent of the parties and that the dispute may be referred to fresh arbitration under the Arbitration Act. The court affirmed that where both parties agree to the setting aside of an award, there is no legal bar to remitting the matter for fresh adjudication, whether before the same or a newly appointed arbitrator. Relying on the SC’s decision in Mutha Construction v. Strategic Brand Solutions (I) Pvt. Ltd. and consistent with its earlier precedents, the court exercised its powers to set aside the award by consent and appoint a fresh sole arbitrator, reinforcing the principle of party autonomy and the consensual foundation of arbitration under the Arbitration Act.

Labour codes implemented

On November 21, 2025, the Ministry of Labour and Employment (MLE) notified the implementation of the 4 (four) consolidated labour codes, namely the Code on Wages, 2019, the Industrial Relations Code, 2020, the Occupational Safety, Health and Working Conditions Code, 2020, and the Code on Social Security, 2020 (collectively the Codes). With this notification, the Codes have come into force and collectively replace 29 (twenty-nine) Central labour legislations, introducing a unified and modern statutory framework governing wages, industrial relations, social security, and workplace safety across India.

The MLE noted that although the Codes were enacted between 2019 and 2020, their implementation follows more than 5 (five) years of stakeholder consultations and preparatory measures undertaken by the Central and State Governments. While the Codes are now in force, their full operational effect remains contingent on the notification of the corresponding rules by the centre and respective states, many of which are yet to be brought into effect, for which MLE notified draft rules on December 30, 2025, pending stakeholder objections for each Code. Nonetheless, certain authorities have already initiated administrative and compliance measures aligned with the emerging framework under the Codes, including adoption of revised definitions and beneficiary categories, particularly under the Code on Social Security, 2020. In this backdrop, employers should anticipate a phased transition and proactively undertake a review of their human resource policies, employment contracts, compliance systems, and workforce documentation to ensure timely alignment with the new labour law regime once the rule-making process is completed.

For further details on Codes please refer to:

(i) The Code of Wages: https://cms-induslaw.com/en/ind/publication/the-code-of-wages

(ii) The Code on Social Security: https://cms-induslaw.com/en/ind/publication/the-code-on-social-security

(iii) The Industrial Relations Code: https://cms-induslaw.com/en/ind/publication/the-industrial-relations-code

(iv) The Occupational Safety, Health and Working Conditions Code: https://cms-induslaw.com/en/ind/publication/the-oshwc-code

Notification of Companies (Meetings of Board and its Powers) Amendment Rules, 2025

On November 3, 2025, the Ministry of Corporate Affairs (MCA) notified the Companies (Meetings of Board and its Powers) Amendment Rules, 2025 (Amendment Rules) amending the Companies (Meetings of Board and its Powers) Rules, 2014. The amendment expands and clarifies the scope of the expression ‘business of financing industrial enterprises’ for specified categories of finance entities.[8]

The MCA clarified that, in the case of a Non-Banking Financial Company (NBFC) registered with the RBI, the expression includes the business of granting loans or providing guarantees or security for the due repayment of loans, when carried out in the ordinary course of business. Further, in respect of a finance company registered with the International Financial Services Centres Authority (IFSCA), the expression now includes activities specified under regulation 5(1)(ii)(a) and (e) of the IFSCA (Finance Company) Regulations, 2021, such as lending in the form of loans, commitments and guarantees, credit enhancement, securitisation, financial leasing, sale and purchase of portfolios, and activities relating to global or regional corporate treasury centres, when undertaken in the ordinary course of business. This amendment adds clarification that activities such as lending and giving of guarantees undertaken by NBFCs and IFSCA registered finance companies in ordinary course of business do not require a separate board approval.

Digital Personal Data Protection Rules operationalised

On November 13, 2025, India operationalized its first comprehensive digital personal data regime with the coming into force of the Digital Personal Data Protection Rules, 2025 (Rules), issued under the Digital Personal Data Protection Act, 2023 (DPDP Act).[9] With the notification of the Rules, the DPDP Act has become fully operational, establishing India’s first standalone legal framework governing the processing of digital personal data. The Rules impose stringent compliance obligations on organisations classified as data fiduciaries, including restrictions on data collection strictly to what is necessary for specified purposes, requirements for verifiable parental consent in respect of children’s data, and mandatory and prompt breach notifications to affected data principals and the regulator. The framework also provides enhanced accountability standards for entities handling sensitive and large-scale data processing. The regime has extraterritorial application, extending to entities located outside India that offer goods or services to individuals in India or engage in profiling of data principals within India. The operationalisation of the DPDP Act through the Rules marks a significant shift in India’s data protection landscape, requiring organisations to urgently review and realign their data governance, consent mechanisms, and incident response frameworks to ensure compliance.

For further details please refer to https://cms-induslaw.com/en/ind/publication/dpdp-rules-an-attempt-to-bring-order-to-the-chaos

Definition of ‘small company’ amended

The MCA has amended the definition of a ‘small company’ under section 2(85) of the Companies Act, 2013 (the Act) by increasing the paid-up share capital and turnover thresholds to approximately USD 111,146 and approximately USD 11.1 million respectively, pursuant to rule 2(1)(t) of the Companies (Specification of Definitions Details) Rules, 2014. This represents a significant enhancement from the earlier thresholds of approximately USD 444,585 and approximately USD 4.5 million and brings the limits to the maximum permitted under the Act.

Companies qualifying as small companies continue to benefit from reduced compliance requirements, including abridged filings and lower penalties, while certain entities such as holding companies, subsidiaries, section 8 companies under the Act, and entities governed by special statutes remain excluded and continue to be subject to mandatory dematerialisation under rule 9B of the Companies (Prospectus and Allotment of Securities) Rules, 2014. The revised thresholds substantially reduce the number of private companies required to dematerialise their securities, addressing operational, cost and shareholder-level challenges associated with dematerialisation. This also enables smaller companies to scale with greater regulatory flexibility, while also easing the compliance burden on depositories and market intermediaries.

Parliament passes insurance law reforms to liberalise FDI

The Parliament on December 17, 2025, passed the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill, 2025 (Bill) amending 3 (three) Acts, The Insurance Act, 1938, The Life Insurance Corporation Act, 1956 and The Insurance Regulatory and Development Authority Act, 1999.[10] Life Insurance Corporation under this bill has been provided with autonomy to open zonal offices and align foreign offices with laws of respective jurisdictions. Key features of the Bill include:

(i) Foreign direct investment (FDI): 100% (one hundred percent) FDI permitted in insurance companies allowing more foreign player participation.

(ii) Licensing: One time licensing introduced for ease of doing business and provisions for suspension of license instead of cancellation.

(iii) Regulatory approval threshold: Transfer of share capital requiring regulatory approval has an increased threshold of 5% (five percent) from previous 1% (one percent) and the net owned fund requirement for foreign reinsurance branches has been reduced from approximately USD 600 million to approximately USD 120 million.

(iv) Policyholder protection and governance: Introduction of a dedicated Policyholders’ Education and Protection Fund to enhance insurance awareness and mandate alignment of policyholder data practices with the DPDP Act, 2023. Insurance Regulatory and Development Authority of India has been given powers to disgorge wrongful gains from insurers and intermediaries and penalties are being rationalised and factors for imposition of penalties are being introduced.

1. Honda Motor Co., Ltd. has decided to invest in OMC Power Private Limited to support the launch of a leasing business in India for uninterruptible power supply (UPS) devices that use Honda’s Mobile Power Pack e: batteries.[11] Beginning in January 2026, OMC Power will offer leased UPS solutions to households, small businesses, schools and other facilities, aiming to provide a more stable and cleaner alternative to diesel generators in areas with unreliable electricity. Under the arrangement, Honda’s battery-sharing subsidiary in India, Honda Power Pack Energy India Pvt. Ltd., will supply the portable, swappable Honda Mobile Power Pack e: units to OMC Power, which will integrate them with its UPS systems and manage lease operations. Honda’s investment follows joint demonstration tests in Uttar Pradesh showing that repurposing electric motorcycle batteries can help stabilize local energy supply and reduce environmental impact.

2. Mitsubishi UFJ Financial Group (MUFG) announced an investment of approximately USD 4.4 billion for the acquisition of 20% (twenty per cent) stake via preferential issuance of equity shares in Shriram Finance Limited (SFL), marking one of the largest Japanese investments in India’s financial sector, subject to shareholder and regulatory approvals. The investment will strengthen SFL’s capital base and funding profile, allowing for enhanced access to diversified and potentially lower cost capital, and bringing global governance and risk-management expertise, while SFL maintains its focus on vehicle, MSME and retail lending across semi-urban and rural India.[12]

3. Mizuho Securities (part of Mizuho Financial Group) (Mizuho) has announced strategic partnership with Avendus. Mizuho has announced that it will acquire over 60% (sixty percent) stake in Avendus Capital from US based investment firm, Kohlberg Kravis Roberts & Co. (KKR).[13]

4. Sumitomo Corporation has agreed to acquire a portion of shares in TruAlt Gas Private Limited, a subsidiary of India’s largest ethanol producer TruAlt Bioenergy and entered into a strategic collaboration to expand bioenergy production in India. Under the partnership, the renamed entity will build 16 (sixteen) compressed biomethane gas (CBG) production facilities across India with operations starting in 2026, and both firms plan to grow bioethanol output and sustainable aviation fuel (SAF) production, supporting Sumitomo’s broader energy-transition strategy and India’s renewable fuel goals.[14]

[1] Central Drugs Standard Control Organization (CDSCO), Circular on Requirement of License issued by CDSCO/State Licensing Authorities in procurement of medical devices by procurement agencies, Ministry of Health and Family Welfare, dated 17 Nov 2025, available at https://cdsco.gov.in/opencms/resources/UploadCDSCOWeb/2018/UploadCircularFile/Circular-17-11-2025.pdf, last accessed 8 Jan 2026.

[2] Press Information Bureau, ANRF, in collaboration with ICMR and Gates Foundation, launches Maha MedTech Mission; Maha MedTech Mission to Strengthen India’s Medical Technology Ecosystem, Ministry of Science & Technology, dated October 25, 2025, available at https://www.pib.gov.in/PressReleasePage.aspx?PRID=2182432&reg=3&lang=2, last accessed January 8, 2026.

[3] Ministry of Petroleum and Natural Gas, Petroleum and Natural Gas Rules, 2025, G.S.R. 888(E), The Gazette of India: Extraordinary (Part II — Section 3(i)), dated 09 Dec 2025, available at https://mopng.gov.in/files/Whatsnew/2025-12-19-163402-29rio-PNG-Rules,-2025.pdf, last accessed 08 Jan 2026.

[4] Ministry of Law and Justice (Legislative Department), The Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Act, 2025, Act No. 39 of 2025, dated 20 Dec 2025, available at https://prsindia.org/files/bills_acts/bills_parliament/2025/The_SHANTI_Act_2025.pdf, last accessed 08 Jan 2026.

[5] Central Electricity Regulatory Commission, Guidelines for Virtual Power Purchase Agreements, CERC No. L-1/257/2020/(PMR-4)/CERC, dated 24 December 2025, available at https://cercind.gov.in/regulations/Guidelines-VPPA.pdf , last accessed 08 Jan, 2026.

[6] Press Information Bureau, Cabinet Approves Rs.7,280 Crore Scheme to Promote Manufacturing of Sintered Rare Earth Permanent Magnets (REPM), Government of India, dated 26 Nov 2025, available at https://www.pib.gov.in/PressReleasePage.aspx?PRID=2194684&reg=3&lang=2, last accessed 08 Jan 2026.

[7] Securities and Exchange Board of India, (Listing Obligations and Disclosure Requirements) (Fifth Amendment) Regulations, 2025, dated November 19, 2025, available at https://www.sebi.gov.in/legal/regulations/nov-2025/securities-and-exchange-board-of-india-listing-obligations-and-disclosure-requirements-fifth-amendment-regulations-2025_97840.html, last accessed November 30, 2025. 

[8] International Financial Services Centres Authority (IFSCA), Companies (Meetings of Board and its Powers) Amendment Rules, 2025, Notification No. G.S.R. 811(E), dated 03 Nov 2025, available at https://ifsca.gov.in/CommonDirect/GetFileView?id=38fea9cc5969551d78bf00e67000566d&fileName=Companies__Meetings_of_Board_and_its_Powers__Amendment__Rules__2025__1__20251121_0509.pdf, last accessed 08 Jan 2026.

[9] Press Information Bureau, Government notifies DPDP Rules to empower citizens and protect privacy, Ministry of Electronics & Information Technology, dated 14 Nov 2025, available at https://www.pib.gov.in/PressReleasePage.aspx?PRID=2190014&reg=3&lang=2, last accessed 8 Jan 2026.

[10] Press Information Bureau. “The Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Bill, 2025 passed by Parliament; allows up to 100% FDI in insurance companies.” Press Release ID: 2206011 (Ministry of Finance, Government of India). Press Information Bureau, New Delhi, 18 Dec 2025. Available at: https://www.pib.gov.in/PressReleasePage.aspx?PRID=2206011&reg=3&lang=1, last accessed 8 Jan 2026.

[11] Honda Motor Co., Ltd., Honda to Invest in OMC Power, which will Launch Leasing Business for Uninterruptible Power Supply Device in India, Honda Global Newsroom, dated 27 Oct 2025, available at https://global.honda/en/newsroom/news/2025/c251027beng.html, last accessed 08 Jan 2026.

[12] Shriram Finance Ltd. MUFG Partnership Signals a Strategic Growth Phase for Shriram Finance (26 Dec 2025). Shriram Finance Articles – Deposits. Retrieved from https://www.shriramfinance.in/articles/deposits/2025/mufg-partnership-signals-a-strategic-growth-phase-for-shriram-finance. Accessed on Jan. 12, 2026.

[13]Avendus Capital. Avendus and Mizuho Announce Strategic Partnership to Power Growth and Expand Global Capabilities (17 Dec 2025). Avendus Newsroom. Retrieved from https://www.avendus.com/india/newsroom/avendus-and-mizuho-announce-strategic-partnership-to-power-growth-and-expand-global-capabilities. Accessed on Jan. 12, 2026.

[14] Sumitomo Corporation. Collaboration with TruAlt Bioenergy, India’s largest ethanol producer; Compressed Biomethane Gas Production and Sales to Commence Next Year – Acquisition of Shares in TruAlt Gas Private Limited, Plans Include Production of Bioethanol and SAF (Nov. 13, 2025). Sumitomo Corporation in Europe. Retrieved from https://www.sumitomocorp.com/en/europe/news/topics/2025/group/20251113. Accessed on Jan. 12, 2026.