Centre weighs new regulatory framework for large startups

A panel may suggest additional compliance requirements for startups to boost governance

- Gireesh Chandra Prasad

The corporate affairs ministry will examine the need for a new regulatory regime for large startups that have grown beyond a certain size to ensure their governance systems become more robust without compromising on ease of doing business, a person familiar with the development said.

A panel of experts advising the ministry—company law committee—will examine this shortly, the person said on the condition of anonymity.

The move comes at a time many Indian startups have achieved scale, have become hugely valuable and have raised large amounts of private capital, but their management capability to handle the governance and compliance obligations in line with their size has raised concerns.

The government wants the large startups to measure up and ensure good governance through a tailored regime while not posing any fresh compliance requirements for small startups.