✓ SEBI board has approved certain key amendments to SEBI Delisting Regulations and SEBI Listing Regulations, as follows:
1. Review of delisting framework pursuant to open offer:
The Board approved the proposal to amend the existing regulatory framework
for delisting of equity shares pursuant to open offer as provided under the extant
Regulation 5A of the SEBI (Substantial Acquisition of Shares and Takeovers)
Regulations, 2011 (Takeover Regulations).
2. Review of certain provisions related to Superior Voting Rights Shares
Framework:
- Relaxation in the eligibility requirements related to Superior Voting Rights (SR) Shares framework as follows:
1. As per the existing provisions, an SR shareholder should not be part of promoter group having net worth more than INR 500 Cr. It has been changed to
require that the SR shareholder, as an individual, should not have net-worth of more than INR 1000 Cr.
2. The minimum gap between issuance of SR shares and filing of Red Herring Prospectus is reduced to 3 months from the existing requirement of 6 months.
3. Review of regulatory provisions on Related Party Transactions under SEBI Listing Regulations:
A. Definition of related party shall include:
a. all persons or entities forming part of promoter or promoter group irrespective of their shareholding;
b. any person/entity holding equity shares in the listed entity, as below, either directly or on a beneficial interest basis at any time during the immediately preceding financial year:
i. to the extent of 20% or more
ii. to the extent of 10% or more w.e.f. April 1, 2023.
B. Scope of Related Party Transactions expanded to include following transactions:
a. the listed entity or any of its subsidiaries on one hand and a related party of the listed entity or any of its subsidiaries on the other hand;
b. the listed entity or any of its subsidiaries on one hand, and any
other person or entity on the other hand, the purpose and effect of which is to benefit a related party of the listed entity or any of its subsidiaries w.e.f. April 1, 2023.
C. Prior approval of the shareholders:
- Prior approval of the shareholders of the listed entity shall be required for material RPTs having a threshold of lower of INR 1000 Cr or 10% of the consolidated annual turnover of the listed entity.
D. Approval of the Audit committee shall be required for following:
a. All RPTs and subsequent material modifications as defined by the Audit committee;
b. RPTs where subsidiary is a party but listed entity is not a party subject to threshold of -
i. 10% of the consolidated turnover of the listed entity,
ii. 10% of the standalone turnover of the subsidiary w.e.f. April 1, 2023.
E. Enhanced disclosure of information related to RPTs to be:
a. Placed before the audit committee,
b. Provided in the notice to shareholders for material RPTs, and
c. Submitted to the stock exchanges every six months in the format specified by the Board with the following timelines:
i. within 15 days from the date of publication of financials;
ii. simultaneously with the financials w.e.f. April 1, 2023.
- These amendments shall come into force with effect from April 1, 2022 unless
otherwise specified above.
∆ Other Key Decisions:
1. Framework for Gold Exchange and SEBI (Vault Managers) Regulations, 2021 proposed.
2. Framework for Social Stock Exchange approved.
3. Investor Charter for Securities Market
4. Amendment to SEBI (Alternative Investment Funds) Regulations, 2012
5. Introduction of Silver Exchange Traded Funds in India
6. Amendments to SEBI (Portfolio Managers) Regulations, 2020 and SEBI
(Alternative Investment Funds) Regulations, 2012
7. Permitting Resident Indians (other than Individuals) to become constituents
of FPIs that are registered as AIFs in IFSCs.
8. Amendment to Schedule II of Securities and Exchange Board of India (Intermediaries) Regulations, 2008 -Criteria for determining ‘Fit and Proper
Person’
- Please click here to refer SEBI press release.
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