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1 SEBI Act, Rules, Regulations, etc. on Fri 15 May 2015 - 12:15

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SEBI releases FAQs on 'Debenture Trustee'

A debenture is an instrument of debt executed by the company acknowledging its obligation to repay the sum at a specified rate and also carrying an interest. It is one of the methods of raising the loan capital of the company. A debenture is thus like a certificate of loan or a loan bond evidencing the fact that the company is liable to pay a specified amount with interest and although the money raised by the debentures becomes a part of the company's capital structure, it does not become share capital.

Read more at:

http://www.sebi.gov.in/cms/sebi_data/attachdocs/1431510867038.pdf



Last edited by rchgiri on Fri 15 May 2015 - 12:18; edited 2 times in total

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SEBI unravels guidelines for Stock exchanges to ensure fair and equitable access to Co-location facility


The facility of co-location or proximity hosting (or by whatever name called) is offered by the stock exchanges to stock brokers and data vendors whereby their trading or data-vending systems are allowed to be located within or at close proximity to the premises of the stock exchanges, and are allowed to connect to the trading platform of stock exchanges through direct and private network.

Read more at:

http://www.sebi.gov.in/cms/sebi_data/attachdocs/1431512252858.pdf

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SECURITIES AND EXCHANGE BOARD OF INDIA
(Share Based Employee Benefits) Regulations, 2014

CIRCULAR

Dated: 16th June,2015

Requirements specified under the SEBI (Share Based Employee Benefits) Regulations, 2014.


1. This has reference to the SEBI (Share Based Employee Benefits) Regulations, 2014 (the Regulations) notified on October 28, 2014. The Regulations provide for certain processes / disclosure requirements to be specified by SEBI. Accordingly, necessary guidelines are being issued and given in the Annexure to this circular.
2. The stock exchanges are advised to bring the contents of this circular to the notice of the companies listed on them and ensure its compliance.
3. This circular is being issued in exercise of the powers under regulation 28 of the Regulations and section 11 read with section 11A of the Securities and Exchange Board of India Act, 1992.
4. This circular is available on SEBI website at sebi.gov.in under the categories “Legal Framework” and “Issues and Listing.

The detailed circular can be read by clicking on the below mentioned link:

http://www.sebi.gov.in/cms/sebi_data/attachdocs/1434444609664.pdf

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Market regulator sets new conditions for reclassification of promoters

MUMBAI, JUNE 23:
Capital market regulator SEBI has said a promoter of a company may cease to be treated as a promoter under three conditions including when a new promoter replaces the old subsequent to an open offer. This would be subject to shareholder approval, the market regulator said.

Infosys experience

Existing promoters may also be re-classified as public in case a company becomes professionally managed — that is, it does not have any identifiable promoter. These are companies where no entity holds more than 1 per cent, while fund houses, banks, financial institutions, insurers, FPIs and the like hold up to 10 per cent.

In case of an entity inherits a promoter’s stake, the inheritor would be classified as promoter.

Re-classification of promoters as public shareholders was taken up by SEBI after the founders of Infosys wanted to re-classify themselves as public shareholders after handing over the day-to-day operations of the company to a professional management in October 2014. The outgoing promoter would not be allowed to hold more than 10 per cent stake in the company and shareholder approval would be required if the outgoing promoter is to be retained as a key management person (MD/CEO/CFO/COO/Company Secretary) of the company for up to a maximum of three years.

The outgoing promoter would not have any special rights (such as a right to veto/ right to board seat) and cannot directly/ indirectly exercise control over the company.

Compliance norm

Increase in public shareholding after re-classification would not be counted towards achieving compliance with minimum public shareholding requirement of 25 per cent SEBI said. Conversely, a public shareholder seeking to re-classify himself as promoter has to make an open offer and would be eligible for exemption from the said obligation.

Re-classification has to be reported to exchanges as a material event, SEBI said.

(This article was published on June 23, 2015)

Source: http://www.thehindubusinessline.com/markets/stock-markets/market-regulator-sets-new-conditions-for-reclassification-of-promoters/article7347220.ece

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Streamlining process of public issues- Obviating the need to issue cheques 23/06/2015


PR No. 167/2015

SEBI Board Meeting

The SEBI Board met at Mumbai today. Highlights of the decisions taken are as follows:

1. Streamlining process of public issues- Obviating the need to issue cheques:

Initial Public Offering (IPO) process streamlined to, reduce time period for listing of issues from T+12 days to T+6 days, increase reach of retail investors to access the IPO and reduce the cost of public issues. With this issuers will have faster access to the capital raised and investors will have early liquidity.

2. Simplified framework for capital raising by technological start-ups and other companies.
Enabling provisions approved for capital raising by technological start-ups and other companies through Institutional Trading Platform.

3. Fast Track Issuances through FPOs or Rights Issue:
Requirement of market capitalization of public shareholding of the issuer for Fast Track Issues (FTI) reduced to Rs. 1000 crore in case of Follow on public offering (FPO) and Rs. 250 crore in case of rights issue. This will help more listed companies to raise further capital using fast track route.

4. Review of Offer for Sale (OFS) through stock exchange mechanism
Changes proposed to encourage greater retail participation in OFS.

5. Reclassification of Promoters as Public:
A rationalised, simple framework put in place for reclassification of promoters as public. The proposed framework will bring in consistency and also enable investors to take informed decisions based on any such move by the company / promoters

6. Annual Report for 2014-15
Annual Report for 2014-15 approved by the Board.
The details of some of the decisions taken are as follows:
1.Streamlining the Process of Public Issues – Obviating the need to issue cheques
In order to reduce the post-issue timeline for listing from existing T+12 days to T+6 days, increase the reach of retail investors and reduce the costs involved in public issue of equity shares and convertibles, Board took the following decisions:

i. Presently more than 99.5 % applications are received from centres where ASBA facility is available. Based on an analysis of a few public issues, in terms of amount, ASBA applications account for 99.90% of the total bid amount received from all investors. Considering the reach and advantages of ASBA, it shall now be mandatory for all investors to make ASBA applications. Amongst many other significant advantages, ASBA enables investors to give the mandate for payment of application money in the application form itself without suffering loss of interest for the intervening period. It also obviates the hassle of refund of money by the issuer as per the difference in application amount and the amount for which shares are finally allotted.

ii. In order to substantially enhance the points for submission of applications, Registrar and Share Transfer Agents (RTAs) and Depository Participants (DPs) shall also be allowed to accept application forms (both physical as well as online) and make bids on the stock exchange platform. This will be over and above the stock brokers and banks where such facilities are presently available.

iii. To help intermediaries and banks to modify their existing systems and train their staff and also enable the investors to adapt to the new system, there will be a phase-in period of 6 months. Accordingly, a public issue which opens on or after January 01, 2016 will have to follow the new system.

2. Simplified Framework for Capital Raising by technological start ups and other companies on Institutional Trading Platform.
The Board undertook a review of the extant regulatory framework in the primary market and noted the suggestions of market participants on making the existing avenues for capital raising amenable for accommodating a larger number of start-up companies. Based on the same, the Board approved the following proposals to amend the regulations concerning the ITP Platform:

i. The platform shall now be called as Institutional Trading Platform (ITP) and shall facilitate capital raising as well.

ii. The said platform will be made accessible to:

a. companies which are intensive in their use of technology, information technology, intellectual property, data analytics, bio-technology, nano-technology to provide products, services or business platforms with substantial value addition and with at least 25% of the pre-issue capital being held by QIBs (as defined in SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009), or

b. any other company in which at least 50% of the pre-issue capital is held by QIBs.

iii. No person (individually or collectively with persons acting in concert) in such a company shall hold 25% or more of the post-issue share capital.

iv. Considering the nature of business of companies which may list on the said platform, disclosure may contain only broad objects of the issue and there shall be no cap on amount raised for General Corporate Purposes. Further, the lock in of the entire pre-issue capital shall be for a period of 6 months from the date of allotment uniformly for all shareholders.

v. As the standard valuation parameters such as P/E, EPS, etc. may not be relevant in case of many of such companies, the basis of issue price may include other disclosures, except projections, as deemed fit by the issuers.

vi. Companies intending to list on the proposed ITP, shall be required to file draft offer document with SEBI for observations, as provided in SEBI (ICDR) Regulations, 2009.

vii. Only two categories of investors, i.e. (i) Institutional Investors (QIB as defined in SEBI (ICDR) Regulations, 2009 along with family trusts, systematically important NBFCs registered with RBI and the intermediaries registered with SEBI, all with net-worth of more than Rs. 500 crore) and (ii) Non-Institutional Investors (NIIs) other than retail individual investors can access the proposed ITP.

viii. In case of public offer, allotment to institutional investors may be on a discretionary basis whereas to NIIs it shall be on proportionate basis. Allocation between the said two categories shall be in the ratio of 75% and 25%, respectively.

ix. .In case of discretionary allotment to institutional investors, no institutional investor shall be allotted more than 10% of the issue size. All shares allotted on discretionary basis shall be locked-in in line with requirements for lock-in by Anchor Investors i.e. 30 days at present.
x. The minimum application size in case of such issues shall be Rs. 10 lakhs and the minimum trading lot shall be of Rs. 10 lakhs.

xi. The number of allottees in case of a public offer shall be 200 or more.

xii. The company will have the option to migrate to main board after 3 years subject to compliance with eligibility requirements of the stock exchanges.

xiii. For Category I and II AIFs, which are required under the SEBI (Alternative Investment Funds) Regulations, 2012 to invest a certain minimum amount in unlisted securities, investment in shares of companies listed on this platform may be treated as investment in ‘unlisted securities’ for the purpose of calculation of the investment limits.
Grandfathering of existing companies listed on SME-ITP:

xiv. The existing companies listed on SME-ITP may continue to be guided by the existing regulatory framework for them including applicable relaxations from compliance with corporate governance requirements.
Rationalisation of disclosures for proposed ITP as well as main board:
xv. Further, in order to rationalize the disclosures requirements for all issuers whether intending to list on the main board or the proposed ITP, it has been decided that the disclosures in offer document with respect to group companies, litigations and creditors shall be in accordance with policy on materiality as defined by the issuer. However, all relevant disclosures shall be available on the website of the issuer. Also, the product advertisements of an issuer will not be required to give details of public/rights issue.

3. Fast Track Issuances – Follow on Public Offerings and Rights Issues
In order to enable more number of listed companies to raise further capital using fast-track route, Board approved the proposal to reduce the minimum public holding requirement from Rs. 3000 crore to Rs. 1000 crore in case of FPO and to Rs. 250 crore in case of rights issue, subject to compliance with following additional conditions:

i. In case of rights issue, promoters shall not renounce their rights, except to the extent of renunciations within the promoter group, or for the purposes of complying with minimum public shareholding norms;

ii. Annualized delivery based trading turnover requirement of 10% of the total paid up capital;

iii. No conflict of interest between the lead manager and the issuer or its group or associate company in accordance with applicable SEBI Regulations;
iv. Shares of the company should not have been suspended from trading as a disciplinary measure in past 3 years;
v. Issuer, promoter group and directors of the issuer should not have settled any alleged violation of securities laws through the consent mechanism with the Board in last 3 years. This is in addition to the existing condition that no show-cause notices should have been issued or prosecution proceedings initiated by SEBI or pending against the issuer or its promoters or whole time directors.

4. Review of Offer for Sale (OFS) of Shares through stock exchange mechanism

A discussion paper was floated on the review of Offer for Sale of Shares (OFS) through Stock Exchange mechanism. The Board considered the comments / suggestions received on the discussion paper and approved the following changes to the present OFS framework:

i. To ensure increased retail participation in the OFS process, OFS notice shall be continued as per present practice i.e. latest by T-2 days, however, T-2 day shall be reckoned from banking day instead of trading day.

ii. To simplify the bidding process for retail investors, it would be mandatory for the seller to provide the option to retail investors to place their bids at cut off price (default option) in addition to placing price bids.

5. Re-classification of Promoters as Public
In order to put in place a policy framework with respect to re-classification of promoters in listed companies as public shareholders under various circumstances, the Board has approved the proposal for putting in place a regulatory framework for the purpose.

Existing promoter of a listed entity may cease to be a promoter and/or re-classify itself as public in the following circumstances, on compliance with conditions stated thereunder:

Pursuant to change in promoter

i. When a new promoter replaces the previous promoter subsequent to an open offer or in any other manner, re-classification shall be permitted subject to approval of shareholders in the general meeting.

ii. Shareholders need to specifically approve whether the outgoing promoter can hold any Key Management Personnel (“KMP”) position in the company. In any case, the outgoing promoter may not act as KMP for a period of more than 3 years from the date of shareholders’ approval.

iii. The outgoing promoter can’t hold more than 10% shares of the company.

Inheritance

In case of transmission/succession/inheritance, the inheritor shall be classified as promoter.

Company not having any identifiable promoter
Existing promoters may be re-classified as public in case the company becomes professionally managed and does not have any identifiable promoter. A company will be considered as professionally managed for this purpose, if:

No person or group along with Persons Acting in Concert (PACs) taken together holds more than 1% shares of the company (including any convertibles/outstanding warrants/ADR/GDR Holding).
Mutual Funds/Banks/Insurance Companies/Financial Institutions/FPIs can each hold up to 10% shares of the company (including any convertibles/outstanding warrants/ADR/GDR Holding).

Erstwhile promoters and their relatives may hold KMP position in the company only subject to shareholders’ approval and for a period not exceeding 3 years from the date of shareholders’ approval.

The following conditions shall also be applicable:
i. The outgoing promoter shall not have any special rights through any formal or informal arrangements.

ii. The outgoing promoter shall not, directly or indirectly, exercise control over the affairs of the company.

iii. Increase in public shareholding pursuant to re-classification of promoters may not be counted towards achieving compliance with minimum public shareholding (MPS) requirement under clause 40A of equity listing agreement read with rule 19A of the Securities Contracts (Regulations) Rules, 1957 (SCRR).

iv. If any public shareholder seeks to re-classify itself as promoter, it shall be required to make an open offer to the shareholders and would not be eligible for exemption from the said obligation.

v. The event of re-classification may be disclosed as a material event in accordance with the listing agreement/regulations.
In order to remove difficulties in specific cases the Board authorized the Chairman, SEBI to take required measures on a case to case basis.

6. SEBI Annual Report: 2014-15
The Board considered and approved the SEBI Annual Report: 2014-15. In compliance with Section 18(2) of SEBI Act, 1992, the same Annual Report would be submitted to the Central Government.

7. FMC- SEBI merger
The Board also discussed operational issues relating to the merger of Forward Markets Commission (FMC) with SEBI.

8. Recommendations of the Depository System Review Committee (DSRC)
An expert committee was constituted by SEBI, to inter-alia review and assess the depository system on the basis of CPSS-IOSCO principles so as to benchmark with global best practices. In its meeting held on November 19, 2014 the Board broadly accepted the recommendations of the committee.

The Board today reviewed the status of the implementation of recommendations and noted that the Depositories have been advised to implement the following:

i. Develop a mechanism to maintain complete reconciled record of total issued and listed capital, including both physical and dematerialized shares.

ii. Risk Management Policy at the Depositories and Information Technology (IT) infrastructure of the Depository Participants.

iii. Popularization of e-KYC among Depository Participants.

iv. Put in place systems to facilitate generation and dispatch of single Consolidated Account Statements (CAS) for investors having investments in securities and Mutual Funds, which has been implemented with effect from March 01, 2015.

9. Interim Use of Funds by the Issuers
In order to prevent misuse of funds during the interim period pending utilization by the issuer, for funds raised through public / rights issue in accordance with SEBI (ICDR) Regulations, 2009, the Board decided that net Issue proceeds pending utilization (for the stated objects) shall be deposited only in the Scheduled Commercial Banks included in the Second Schedule of Reserve Bank of India Act, 1934. In case of public / rights issue of Indian Depository Receipts, the issuer shall keep the funds in a bank having a credit rating of ‘A’ or above by an international credit rating agency.

Mumbai – June 23, 2015

Source: SEBI Website

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Please find the amendments of the following


SEBI (Substantial Acquisition of Shares and Takeovers) (Amendment) Regulations, 2015

Link:

http://www.sebi.gov.in/cms/sebi_data/attachdocs/1427261613075.pdf

SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2015

Link:

http://www.sebi.gov.in/cms/sebi_data/attachdocs/1430885990682.pdf

7 FAQs – DELISTING on Tue 4 Aug 2015 - 7:49

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FAQs – DELISTING

1. What is meant by delisting of securities?

The term "delisting" of securities means permanent removal of securities of a listed company from a stock exchange. As a consequence of delisting, the securities of that company would no longer be traded at that stock exchange.

2. What is the difference between Voluntary delisting and Compulsory delisting?

Compulsory delisting refers to permanent removal of securities of a listed company from a stock exchange as a penalizing measure at the behest of the stock exchange for not making submissions/comply with various requirements set out in the Listing agreement within the time frames prescribed. In voluntary delisting, a listed company decides on its own to permanently remove its securities from a stock exchange.

3. What is the exit opportunity available for investors in case a company gets delisted?

SEBI (Delisting of Securities) Guidelines, 2003 provide an exit mechanism, whereby the exit price for voluntary delisting of securities is determined by the promoter of the concerned company which desires to get delisted, in accordance to book building process. The offer price has a floor price, which is average of 26 weeks average of traded price quoted on the stock exchange where the shares of the company are most frequently traded preceding 26 weeks from the date public announcement is made. There is no ceiling on the maximum price.

In case of infrequently traded securities, the offer price is as per Regulation 20 (5) of SEBI (Substantial Acquisition and Takeover) Regulations. For this purpose, infrequently traded securities is determined in the manner as provided in Regulation 20 (5) of SEBI (Substantial Acquisition and Takeover) Regulations.

4. Does a company listed at BSE/NSE have to provide exit offer to shareholders in case it delists from stock exchanges other than BSE and NSE?

No, the company does not have to provide exit offer to shareholders because it continues to be listed on the BSE / NSE which have nationwide reach and shareholders can exit any time they decide to so by way of selling shares in NSE/ BSE.

Sourse: http://www.sebi.gov.in/faq/faqdelist.html

8 FAQs on delisting of equity shares on Tue 3 Nov 2015 - 22:31

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FREQUENTLY ASKED QUESTIONS ON SEBI (DELISTING OF EQUITY SHARES) REGULATIONS, 2009

PRESS RELEASE, DATED 2-11-2015

These FAQs offer only a simplistic explanation/clarification of terms/concepts related to the SEBI (Delisting of Equity Shares) Regulations, 2009 ["Delisting Regulations, 2009"]. Any such explanation/clarification that is provided herein should not be regarded as an interpretation of law nor be treated as a binding opinion/guidance from the Securities and Exchange Board of India ["SEBI"]. For full particulars of laws governing the delisting of equity shares, please refer to actual text of the Acts/Regulations/Circulars appearing under the Legal Framework Section on the SEBI website.

1. What is meant by delisting of securities?

The term "delisting" of securities means removal of securities of a listed company from a stock exchange. As a consequence of delisting, the securities of that company would no longer be traded at that stock exchange.

2. What is the difference between voluntary delisting and compulsory delisting?

In voluntary delisting, a company decides on its own to remove its securities from a stock exchange whereas in compulsory delisting, the securities of a company are removed from a stock exchange as a penal measure for not making submissions/complying with various requirements set out in the Listing agreement within the time frames prescribed

3. What is the exit opportunity available for investors in case a company gets delisted?

SEBI (Delisting of Securities) Regulations, 2009 provide an exit mechanism to the existing shareholders in the following manner:

Voluntary delisting whereby the exit price is determined through the Reverse Book Building process- The floor price is calculated in accordance with the regulations and the shareholders have to make a bid at a price either on or above the floor price. The exit price would be decided on the basis of bidding by the public shareholders. If the exit price so determined is acceptable to the promoter, the promoter pays that price to the investors and the investors can exit.

Those investors who do not participate in the Reverse Book Building process have an option to offer their shares for sale to the promoters. The promoters are under an obligation to accept the shares at the same exit price. This facility is usually available for a period of at least one year from the date of closure of the delisting process.

Voluntary Delisting for a small company- Any company with paid up capital of less than Rs. ten crore and net worth less than Rs. twenty five crores, whose equity shares have not been traded in any recognized stock exchange for a period of one year and has not been suspended for any non-compliance in the preceding one year would not be required to follow the Reverse Book Building process. In such cases, the promoter decides the exit price in consultation with the merchant banker. The promoter writes to all public shareholders informing the proposal for delisting. Once the requisite consent is received, the promoter makes payment of consideration for the same and the shareholders can exit.

4. Whether a company listed on more than one stock exchange has to provide exit offer to shareholders in case it delists from one stock exchange but remains listed on the other stock exchange?

A company which delists its equity shares from a recognised stock exchange but continues to remain listed on another recognised stock exchange would not be required to provide an exit opportunity to its shareholders provided the equity shares remain listed on any recognised stock exchange which has nationwide trading terminals.

5. Whether the same merchant banker appointed to carry out due-diligence on behalf of the company in terms of Regulation 8(1A) of Delisting Regulations can act as a Manager to the offer?

Yes, the same merchant banker can conduct due-diligence on behalf of the company and also act as the Manager to the Delisting Offer.

6. What is the reference date for calculation of floor price under the delisting Regulations?

The reference date for computing the floor price would be the date on which the recognized stock exchanges were notified of the board meeting in which the delisting proposal would be considered

7. What would constitute demonstration of delivering the letter of offer to all the public shareholders in terms of the proviso to regulation 17(b) of Delisting Regulations in cases where atleast 25% of the public shareholders do not participate in the book building process?

In this regard, it is clarified as under:

a. If the acquirer or the Merchant Banker sends the letter of offer to all the shareholders by registered post or speed post through India Post and is able to provide a detailed account regarding the status of delivery of the letters of offer (whether delivered or not) sent through India Post, the same would be considered as a deemed compliance with the proviso to regulation 17(b) of the Delisting Regulations.

b. If the Acquirer and Merchant Banker are unable to deliver the letter of offer to certain shareholders by modes other than speed post or registered post of India Post, efforts should be made to deliver the letter of offer to them by speed post or registered post of India Post. In that case, a detailed account regarding the status of delivery of letter of offer (whether delivered or not) provided from India Post would also be considered as deemed compliance with the proviso to regulation 17(b) of the Delisting Regulations.

8. In case any third party acquirer makes a delisting offer instead of an open offer under regulation 5A of SEBI(Substantial Acquisition of Shares and Takeover) Regulations, 2011, whether the requirement of Board approval and MB due diligence would apply?

Yes, the requirement of Board approval and due diligence by the Merchant Banker would apply in such cases as well.

9. Can cash component of the escrow account in the delisting offer process be maintained in an interest bearing account?1

Yes, the cash component of the escrow account may be maintained in an interest bearing account. However, the merchant banker shall ensure that the funds are available at the time of making payment to shareholders.

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THE GAZETTE OF INDIA

EXTRAORDINARY

PART – III – SECTION 4

PUBLISHED BY AUTHORITY

NEW DELHI, JULY 08, 2016

SECURITIES AND EXCHANGE BOARD OF INDIA

NOTIFICATION

Mumbai, the 8th July, 2016

SECURITIES AND EXCHANGE BOARD OF INDIA (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS)(SECOND AMENDMENT) REGULATIONS, 2016

No. SEBI/ LAD-NRO/GN/2016-17/008 .─In exercise of the powers conferred by section 11, sub section (2)of section 11A and section 30 of the Securities and Exchange Board of India Act, 1992 (15 of 1992) read with section 31 of the Securities Contracts (Regulation) Act, 1956 (42of 1956),the Securities and Exchange Board of India hereby makes the following regulations to further amend the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, namely:-

1. These regulations may be called the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) (Second Amendment) Regulations, 2016.

2. They shall come into force on the date of their publication in the Official Gazette.

3. In the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, after Regulation 43 the following regulation shall be inserted, namely:-

“Dividend Distribution Policy.

43A. (1) The top five hundred listed entities based on market capitalization (calculated as on March 31 of every financial year) shall formulate a dividend distribution policy which shall be disclosed in their annual reports and on their websites.

(2) The dividend distribution policy shall include the following parameters:

(a) the circumstances under which the shareholders of the listed entities may or may not expect dividend;

(b) the financial parameters that shall be considered while declaring dividend;

(c) internal and external factors that shall be considered for declaration of dividend;

(d) policy as to how the retained earnings shall be utilized; and

(e) parameters that shall be adopted with regard to various classes of shares:

Provided that if the listed entity proposes to declare dividend on the basis of parameters in addition to clauses (a) to (e) or proposes to change such additional parameters or the dividend distribution policy contained in any of the parameters, it shall disclose such changes along with the rationale for the same in its annual report and on its website.

(3) The listed entities other than top five hundred listed entities based on market capitalization may disclose their dividend distribution policies on a voluntary basis in their annual reports and on their websites.”

U.K. SINHA
CHAIRMAN
SECURITIES AND EXCHANGE BOARD OF INDIA

Footnote: 1. The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 were published in the Gazette of India on 2nd September 2015 vide No. SEBI/LAD-NRO/GN/2015-16/013.

2. The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, were subsequently amended on:

(a) December 22, 2015 by Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2015 vide notification no. SEBI/LAD-NRO/GN/2015-16/27.

(b) May 25, 2016 by Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2016 vide notification no. SEBI/LAD-NRO/GN/ 2016-17/001.

Source: http://www.sebi.gov.in/cms/sebi_data/attachdocs/1468383846971.pdf

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GAZETTE OF INDIA EXTRAORDINARY PART – III – SECTION 4 PUBLISHED BY AUTHORITY
NEW DELHI, MAY 27, 2016

SECURITIES AND EXCHANGE BOARD OF INDIA NOTIFICATION
Mumbai, the 27th May, 2016

SECURITIES AND EXCHANGE BOARD OF INDIA (DEPOSITORIES AND PARTICIPANTS) (THIRD AMENDMENT) REGULATIONS, 2016

No. SEBI/ LAD-NRO/GN/2016-17/007- In exercise of the powers conferred by Section 30 of the Securities and Exchange Board of India Act, 1992 (15 of 1992) read with Section 25 of the Depositories Act, 1996 (22 of 1996), the Board hereby makes the following Regulations to further amend the Securities and Exchange Board of India (Depositories and Participants) Regulations, 1996, namely:-

1. These Regulations may be called the Securities and Exchange Board of India (Depositories and Participants) (Third Amendment) Regulations, 2016.

2. They shall come into force on the date of their publication in the Official Gazette.

3. In the Securities and Exchange Board of India (Depositories and Participants) Regulations, 1996, after regulation 35A the following regulation shall be inserted, namely,-

“Wind-down Plan.
35B. Every depository shall devise and maintain a wind-down plan in accordance with guidelines specified by the Board.

Explanation.- For the purpose of this regulation, 'wind-down plan' means a process or plan of action employed, for transfer of the beneficial owner accounts and other operational powers of the depository to an alternative institution that would take over the operations of the depository in scenarios such as erosion of networth of the depository or its insolvency or its inability to provide critical depository operations or services."

U. K. SINHA
CHAIRMAN
SECURITIES AND EXCHANGE BOARD OF INDIA

Footnote: 1. The principal Regulations, Securities and Exchange Board of India (Depositories and Participants) Regulations, 1996 were published in the Gazette of India, Part II on May 16, 1996 vide S.O. No. 345(E).

2. The Securities and Exchange Board of India (Depositories and Participants) Regulations, 1996, were subsequently amended on:
(i) February 7, 1997 by the SEBI (Depositories and Participants) (Amendment) Regulations, 1997 vide S.O. No. 91(E).
(ii) September 5, 1997 by the SEBI (Depositories and Participants) (Second Amendment) Regulations, 1997 vide S.O. No. 640(E).
(iii) January 5, 1998 by the SEBI (Depositories and Participants) (Amendment) Regulations, 1998 vide S.O. No. 18(E).
(iv) January 21, 1998 by the SEBI (Depositories and Participants) (Second Amendment) Regulations, 1998 vide S.O. No. 76(E).
(v) May 20, 1999 by the SEBI (Depositories and Participants) (Amendment) Regulations, 1999 vide S.O. No. 357(E).
(vi) July 7, 1999 by the SEBI (Depositories and Participants) (Second Amendment) Regulations, 1999 vide S.O. No. 546(E).
(vii) September 21, 1999 by the SEBI (Depositories and Participants) (Third Amendment) Regulations, 1999 vide S.O. No. 775(E).
(viii) December 26, 2000 by the SEBI (Depositories and Participants) (Amendment) Regulations, 2000 vide S.O. No. 1160(E).
(ix) May 29, 2001 by the SEBI (Investment Advice by Intermediaries) (Amendment) Regulations, 2001 vide S.O. No. 476(E).
(x) September 27, 2002 by the SEBI (Procedure for holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002 vide S.O. No. 1045(E).
(xi) June 16, 2003 by the SEBI (Depositories and Participants) (Amendment) Regulations, 2003 vide S.O. No. 696(E).
(xii) September 2, 2003 by the SEBI (Depositories and Participants) (Second Amendment) Regulations, 2003 vide S.O. No. 1014(E).
(xiii) October 1, 2003 by the SEBI (Depositories and Participants) (Third Amendment) Regulations, 2003 vide S.O. No. 1156(E).
(xiv) March 10, 2004 by the SEBI (Criteria for Fit and Proper Person) Regulations, 2004 vide S.O. No. 398(E).
(xv) June 10, 2004 by the SEBI (Depositories and Participants) (Amendment) Regulations, 2004 vide S.O. No. 696(E).
(xvi) October 10, 2007 by the SEBI (Depositories and Participants) (Amendment) Regulations, 2007 vide No. 11/LC/GN/2007/4485.
(xvii) March 17, 2008 by the SEBI (Depositories and Participants) (Amendment) Regulations, 2008 vide F. No. 11/LC/GN/2008/20494.
(xviii) May 26, 2008 by the Securities and Exchange Board of India (Intermediaries) Regulations, 2008 vide Notification No. LAD/NRO/GN/2008/11/126538.
(xix) August 8, 2008 by the SEBI (Depositories and Participants) (Second Amendment) Regulations, 2008 vide Notification No. LAD/NRO/GN/2008/18/134585.
(xx) June 19, 2009 by the SEBI (Facilitation of Issuance of India Depository Receipts) (Amendment) Regulations, 2009 vide Notification No. LAD/NRO/GN/2009-10/10/166936.
(xxi) April 13, 2011 by the Securities and Exchange Board of India (Change in Conditions of Registration of Certain Intermediaries) (Amendment) Regulations, 2011vide Notification No. LAD/ NRO/ GN/ 2011-12/03/12650.
(xxii) July 5, 2011 by the Securities and Exchange Board of India (Depositories and Participants) (Amendment) Regulations, 2011 vide Notification No. LADNRO/GN/2011-12/14/21219.
(xxiii) September 11, 2012 by Securities and Exchange Board of India (Depositories and Participants) (Amendment) Regulations, 2012 vide Notification No. LADNRO/GN /2012-13/15/20426.
(xxiv) May 17, 2013 by Securities and Exchange Board of India (Depositories and Participants) (Amendment) Regulations, 2013 vide Notification No. LADNRO/GN/2013-14/09/5738.
(xxv) December 24, 2014 by Securities and Exchange Board of India (Depositories and Participants) (Amendment) Regulations, 2014 vide notification No. LAD/NRO/GN/2014-15/18/1952.
(xxvi) January 21, 2016 by Securities and Exchange Board of India (Depositories and Participants) (Amendment) Regulations, 2016 vide notification No. SEBI/LADNRO/GN/2015-16/032.
(xxvii) March 7, 2016 by Securities and Exchange Board of India (Depositories and Participants) (Second Amendment) Regulations, 2016 vide notification No. SEBI/LAD-NRO/GN/2015-16/038.

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