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Regulatory Initiatives for Simplifying Legal Language in India

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Regulators are taking steps to simplify legal language in legislative drafting, recognizing that overly complex wording can hinder understanding and lead to legal challenges.

The Insurance Regulatory and Development Authority of India has established a committee with the mandate to review and suggest clear and legally sound policy wordings. This initiative aligns with the goal of ensuring insurance accessibility and affordability for all by 2047.

Similarly, the Ministry of Corporate Affairs (MCA) has recently notified Section 64B of the Competition Act, 2002, that grants the Competition Commission of India (CCI) the authority to issue guidelines. These guidelines mandate the rule -making to be clear and precise language, and inter alia include the rules to have (i) title of the guideline, (ii) date from which such guidelines will be effective, (iii) one paragraph shall contain only one sentence and one aspect of guidelines and should not have multiple sentences and aspects, (iv) one paragraph shall contain one subject matter of policy and (v) the provisions shall be drafted in precise, clear and in a simple language.

Recently SEBI also constituted Working Groups to recommend simplification in its regulations and improve compliance processes and reduce costs associated with compliance.

The Insurance Regulatory and Development Authority of India Circular is accessible at: IRDAI Circular – Committee for Plain language for Policy Wordings

The Competition Commission of India amendment gazette notification is accessible at:  CCI – Form of Publication of Guidelines

SEBI Press Release is accessible at: SEBI Press Release – Working Groups to recommend on simplification, ease of compliance and reduction in cost of compliance

Finance Minister of India Ms. Nirmala Sitharaman during Union Budget 2022-203 had said “To simplify, ease and reduce cost of compliance, financial sector regulators will be requested to carry out a comprehensive review of existing regulations. For this, they will consider suggestions from public and regulated entities…”.

With elections approaching, ease of doing business is buzz of the town and for regulators to emulate.

Readers are welcome to share their views with Regstreet Law Advisors at info@regstreetlaw.com

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