The Registrar of Companies (RoC) has imposed fines totaling Rs 27,10,800 on LinkedIn Technology Information Pvt Ltd (LinkedIn India), Microsoft CEO Satya Nadella, LinkedIn CEO Ryan Roslansky, and seven other individuals for violations of the Significant Beneficial Owner (SBO) norms under the Companies Act, 2013. This action, reported by PTI, was taken by the Ministry of Corporate Affairs (MCA) on May 22.
Microsoft, which acquired LinkedIn in December 2016, now faces these penalties due to the failure of its Indian subsidiary and key executives to comply with SBO disclosure requirements. The 63-page order from the RoC (NCT of Delhi & Haryana) specifies that LinkedIn India, Nadella, Roslansky, and others did not adhere to the reporting mandates outlined in section 90(1) of the Companies Act.
The RoC’s order states, “… Satya Nadella and Ryan Roslansky are the SBOs in relation to the subject company and are liable to a penalty under section 90(10) of the Act, due to their failure to report as per section 90(1).” It highlights that Ryan Roslansky, who became the global CEO of LinkedIn Corporation on June 1, 2020, started reporting directly to Nadella.
Section 90 of the Companies Act requires companies to disclose details of their SBOs. The RoC found that LinkedIn India and its officers did not take the necessary steps to identify and report the SBOs, leading to penalties.
LinkedIn India faces a fine of Rs 7 lakh, while Nadella and Roslansky have been fined Rs 2 lakh each. The other fined individuals are Keith Ranger Dolliver, Benjamin Owen Orndorff, Michelle Katty Leung, Lisa Emiko Sato, Ashutosh Gupta, Mark Leonard Nadres Legaspi, and Henry Chining Fong.
Additionally, the RoC noted that the company and its officers failed to send mandatory notices as required under rule 2A (2) of the Companies (Significant Beneficial Owners) Rules, 2018. This oversight constitutes a contravention of section 90(5) and is subject to penalties under section 450. The order emphasizes the liability of all officers, including non-executive directors, due to their presumed knowledge of the company’s holding structure.
The Ministry of Corporate Affairs, through its gazette notification no OS.831(E) dated 24.03.2015, has appointed the undersigned as Adjudicating Officer (AO) under section 454 of the Companies Act, 2013, read with Companies (Adjudication of Penalties) Rules, 2014.
