The Ministry of Corporate Affairs has fined Microsoft-owned LinkedIn India, Satya Nadella, and eight other individuals for violating the significant beneficial owner norms under the Companies Act. Satya Nadella is the CEO of Microsoft, which acquired the professional networking platform LinkedIn in December 2016. In a 63-page order, the Registrar of Companies (NCT of Delhi & Haryana) stated that LinkedIn India and the individuals had violated the Significant Beneficial Owner (SBO) norms under the Companies Act, 2013.
Satya Nadella and Ryan Roslansky are the Significant Beneficial Owners (SBOs) of the company, and they are liable to a penalty under section 90(10) of the Act for failing to report as required by section 90(1). Ryan Roslansky was appointed as the global CEO of LinkedIn Corporation on June 1, 2020 and began reporting to Satya Nadella," the RoC, which falls under the ministry, stated in the order. Section 90 of the Act relates to Significant Beneficial Owner (SBO) disclosures, which mandates companies to provide SBO details.
The company and its officers are facing penalties totaling Rs 27,10,800 for failing to take the necessary steps to identify the Significant Beneficial Owner (SBO) in relation to the company. The Registrar of Companies (RoC) has imposed these penalties on LinkedIn Technology Information Pvt Ltd (LinkedIn India), Nadella, LinkedIn CEO Ryan Roslansky, and seven other individuals.
For SBO norms violations, a penalty of Rs 7 lakh has been slapped on LinkedIn India. Fines of Rs 2 lakh each have been imposed on Nadella and Roslansky, respectively.
Other individuals who have been fined are Keith Ranger Dolliver, Benjamin Owen Orndorff, Michelle Katty Leung, Lisa Emiko Sato, Ashutosh Gupta, Mark Leonard Nadres Legaspi, and Henry Chining Fong.
The company and its officers failed to send a notice, which was mandatory as per rule 2A (2) of the Companies (Significant Beneficial Owners) Rules, 2018. This led to a contravention of section 90(5) for which penalty has been provided under section 450. All the officers, including the non-executive directors, are liable for this violation due to the presumption of clear knowledge on the part of each of such directors about the holding structure of the company.
LinkedIn India has been set up as a subsidiary of Microsoft Group. An appeal can be filed against the order with the Regional Director (NR) within 60 days from the date of receipt of this order.
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Inputs from PTI
