MCA Replaces Annual Director KYC with Once-in-Three-Years Abridged Filing to Ease Compliance
The Ministry of Corporate Affairs said the reform is aimed at significantly reducing compliance burden, particularly for independent directors and professionals serving on multiple boards, while maintaining the integrity of the director database.
New Delhi, January 2: The Ministry of Corporate Affairs (MCA) has notified a major compliance reform under the Companies Act, 2013, replacing the annual Know Your Customer (KYC) requirement for company directors with a simplified KYC filing once every three years.
The change follows a detailed review of Rule 12A of the Companies (Appointment and Qualification of Directors) Rules, 2014, undertaken by the MCA pursuant to the recommendations of the High-Level Committee on Non-Financial Regulatory Reforms (HLC-NFRR) and feedback received from stakeholders. The amended rules were notified on December 31, 2025, and will come into effect from March 31, 2026.
What changes under the new framework
Under the revised rules, the existing annual DIR-3 KYC requirement has been replaced by a single abridged KYC intimation to be filed once every three years. The simplified KYC form can be used for multiple purposes, including:
- KYC compliance
- Updation of mobile number
- Updation of email address
- Updation of residential address
- Re-activation of Director Identification Number (DIN)
Importantly, digital signature verification by the director and certification by a professional will now be required only when the form is used to update personal details such as mobile number, email address or residential address. Routine KYC compliance will not require repeated certification.
Relief for compliant directors
The MCA clarified that all directors who have completed their KYC requirements till date are automatically covered under the new provisions. For such directors, the next KYC filing will be due by June 30, 2028, providing substantial relief from repetitive annual compliance.
Directors who have not yet submitted their KYC forms may continue to reactivate their DINs under the existing provisions until March 31, 2026.
Objective: ease of doing business
Officials said the reform is aimed at significantly reducing compliance burden, particularly for independent directors and professionals serving on multiple boards, while maintaining the integrity of the director database.
The move aligns with the government’s broader push for ease of doing business and trust-based regulatory governance, by shifting from repetitive filings to event-based and risk-proportionate compliance.
The notification, G.S.R. 943(E) dated December 31, 2025, has been published in the Gazette and is available on the MCA website (www.mca.gov.in).
