Reckoning Group CEO as Significant Beneficial Owner of LinkedIn India is far-fetched

I am pleased to share that Lawstreetindia.com, Taxsutra’s portal on Corporate Laws has published my article, that was written in the backdrop of a penalty order dated 22.05.2024 issued by the Registrar of Companies (RoC), NCT of Delhi & Haryana in the case of LinkedIn Technology Information Private Limited, India under sections 89 and 90 of the Companies Act, 2013. The RoC held Satya Nadella, CEO and Chairman, Microsoft Corporation, USA (ultimate parent company of LinkedIn India) and Ryan Roslansky, CEO, LinkedIn Corporation, USA as SBOs of LinkedIn India. 

The article analyses all legal aspects covered by the ROC in his order, relevant provisions of the Companies Act, 2013 read with concomitant SBO Rules, and Financial Action Task Force (FATF) recommendations, to come to the conclusion that Satya Nadella and Ryan Roslansky could be identified as beneficial owners if they were actually benefiting out of LinkedIn India (irrespective of percentage of direct or indirect shareholding), for example, as professional managers of a Pooled Investment Vehicle, an issue that was mentioned in the ROC order but not conclusively proved to apply in this case. Since these persons, despite having control over LinkedIn India’s management and policy decisions, are presently responsible to the Board of Directors of parent company and are deriving salary from that parent company, the extant provisions of the Companies Act, 2013 read with SBO Rules, do not permit holding them as SBOs of LinkedIn India.

All interested stakeholders may access the article at the link given below:

https://lnkd.in/dJ5r-Xht