Related Party Transaction (RPT)

  • November 25, 2021
  • Posted by: OptimizeIAS Team
  • Category: DPN Topics
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Related Party Transaction (RPT)

Subject – Economy

Context – Asian Paints’ promoters must resign from board: In govern

Concept –

  • RPT means transaction between:
  1. Listed entity and a related party of the listed entity;
  2. Listed entity and a related party of the subsidiary of the listed entity;
  3. Subsidiary of the listed entity and a related party of the listed entity;
  4. Subsidiary of the listed entity and a related party of the subsidiary of the listed entity;
  • Related Party Transactions (RPT) are just that — transactions that a company does with parties related to it. An RPT is an arrangement between two entities which share a pre-existing business relationship.
  • The Companies Act, 2013has not prohibited RPTs as a whole but instead lays down safety measures that need to be followed while dealing with RPTs.
economy Related Party Transaction (RPT)