21 January, 2016

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StartUp India Scheme - Compliance Regime based on Self-Certification

StartUp India Scheme - Compliance Regime based on Self-Certification


To reduce the regulatory burden on Startups thereby allowing them to focus on their core business and keep compliance cost low

Regulatory formalities requiring compliance with various labour and environment laws are time consuming and difficult in nature. Often, new and small firms are unaware of nuances of the issues and can be subjected to intrusive action by regulatory agencies. In order to make compliance for Startups friendly and flexible,  simplifications are required in the regulatory regime.
Accordingly, the process of conducting inspections shall be made more meaningful and simple.

Startups shall be allowed to self-certify compliance (through the Startup mobile app) with 9 labour and environment laws (refer below). In case of the labour laws, no inspections will be conducted for a period of 3 years. Startups may be inspected on receipt of credible and verifiable complaint of violation, filed in writing and approved by at least one level senior to the inspecting officer.

In case of environment laws, Startups which fall under the ‘white category’ (as defined by the Central Pollution Control Board (CPCB)) would be able to self-certify compliance and only random checks would be carried out in such cases.
Labour Laws:

•    The Building and Other Constructions Workers’ (Regulation of Employment & Conditions of
Service) Act, 1996
•    The Inter-State Migrant Workmen (Regulation of Employment & Conditions of Service) Act, 1979
•    The Payment of Gratuity Act, 1972
•    The Contract Labour (Regulation and Abolition) Act, 1970
•    The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952
•    The Employees’ State Insurance Act, 1948 Environment Laws:
•    The Water (Prevention & Control of Pollution) Act, 1974
•    The Water (Prevention & Control of Pollution) Cess (Amendment) Act, 2003
•    The Air (Prevention & Control of Pollution) Act, 1981


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