CIRCULAR NO. SEBI/HO /MIRSD/MIRSD_DOR/P/CIR/605/2021, DATED 03-08-2021
SEBI allows non-scheduled Payments Banks to register as ‘Bankers to an Issue’
Editorial Note: The SEBI has permitted non-scheduled Payments Banks to register as ‘Bankers to an Issue’. Now, non-scheduled Payments Banks, which have prior approval from Reserve Bank of India, shall be eligible to act as a BTI subject to fulfilment of the conditions stipulated in the BTI Regulations. In addition, Payments Banks registered as a BTI shall also be permitted to act as a Self-Certified Syndicate Bank.
NOTIFICATION NO. SEBI/LAD- NRO/GN/2021/34, 33 AND 31, DATED 03-08-2021
SEBI includes provisions relating to ‘Accreditation Agency’ in AIF, portfolio managers, and IA regulations
Editorial Note : The SEBI has amended the SEBI (Alternative Investment Funds) Regulations, 2012 (“AIF Regulations”), SEBI (Portfolio Managers) Regulations, 2020 (“PMS Regulations”) and SEBI (Investment Advisers) Regulations, 2013(“IA regulations”) to facilitate participation by Accredited agency in the securities market. The accreditation of investors by an agency may lead to identifying a class of investors who have the ability and willingness to invest in the securities market.
NOTIFICATION NO. SEBI.LAD- NRO/GN/2021/32., DATED 03-08-2021
SEBI tweaks eligible criteria for Foreign Portfolio Investors Editorial Note: SEBI has notified the SEBI (Foreign Portfolio Investors) (Amendment) Regulations, 2021. Now resident Indians other than individuals shall also be eligible to apply for registration as FPIs subject to riders viz. (i) such resident Indian, other than individuals, is an eligible fund manager of the applicant, as provided u/s 9A(4) of the Income Tax Act, 1961; and (ii) the applicant is an eligible investment fund as provided u/s 9A(3) of the IT Act, 1961 which has been approved the IT Rules, 1962.
NOTIFICATION NO. SEBI/LAD-NRO/GN/2021/35., DATED 03-08-2021
SEBI amends LODR norms to further strengthen independence of Independent Directors
Editorial Note: The SEBI has notified the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) (Third Amendment) Regulations, 2021 wherein provision related to
independent directors in order to further strengthen the independence of IDs. Now, the appointment, re-appointment or removal of an independent director of a listed entity,shallalsobesubjectedtothe approval of shareholders by way of a special resolution.
PRESS RELEASE, DATED 03-08-2021
12,889 shell companies struck off in FY 2020-21: Union MoS for Corporate Affairs
independent directors in order to further strengthen the independence of IDs. Now, the appointment, re-appointment or removal of an independent director of a listed entity, shall also be subjected to the approval of shareholders by way of a special resolution.
Editorial Note: The Union Minister of State for Corporate Affairs Shri Rao Inderjit Singh in a written reply to a question in Rajya Sabha stated Special Task Force has been set up by the Government to look into the issue of “Shell Companies” which has inter-alia recommended the use of certain red flag indicators as alerts for identification of Shell Companies. The Govt.has undertaken a Special Drive for identification and strike off of Companies by invoking the provisions of section 248 (1) of the Act, he said.
CIRCULAR NO. SEBI/HO/IMD/IMD-I/DOF5/P/CIR/2 021/610, DATED 04-08-2021
Mutual funds need to maintain current accounts in multiple banks for ease of doing business: SEBI
Editorial Note: Based on the request of mutual fund industry, the SEBI has clarified that mutual funds should maintain current accounts in an appropriate number of banks for the purpose of receiving subscription amount and for payment of redemption / dividend / brokerage / commission etc. to facilitate financial inclusion, convenience of investors and ease of doing business.
CIRCULAR NO. SEBI/HO/DDHS/DDHS_DIV3/P/CIR /2021/611, DATED 04-08-2021
New provisions for InvITs to be complied within 6 months of issuance of circular: SEBI
Editorial Note: The SEBI had amended the SEBI (Infrastructure Investment Trusts) Regulations, 2014 (“InvIT Regulations”) with respect to the requirement of minimum number and holding of unit holders for unlisted InvITs. Now, the SEBI has clarified that Registered unlisted InvITs which have already issued units as on the date of circular, shall comply with the amended provisions of InvIT Regulations within a period of six months from the date of this circular.
CIRCULAR NO. SEBI/HO/FPI&C/P/CIR/2021/609, DATED 04-08-2021
SEBI modifies Operational Guidelines for FPIs and DDPs
Editorial Note: In order to enable Resident Indian fund managers to benefit from the provisions of the SEBI (Foreign Portfolio Investors) Regulations, 2019, the SEBI has modified Operational Guidelines for FPIs and Depository Designated Participants (DDPs) wherein it has stated that the contribution of resident Indian individuals shall be made through the LRS notified by RBI and shall be in global funds whose Indian exposure is less than 50%.”
Rajya Sabha approves of Limited Liability Partnership (Amendment) bill, 2021
Editorial Note: The Rajya Sabha has passed the Limited Liability Partnership (Amendment) Bill, 2021. The Amendment Bill seeks to facilitate greater ease of living to law-abiding corporates and to decriminalise certain provisions of the Act. Key changes as proposed in the bill includes as viz. introduction of the concept of ‘small LLPs’, de-criminalisation of certain offences, empowering Govt. to establish special courts, Authorisation to Regional directors.
NOTIFICATION NO. S.O. 3156(E), DATED 05-08-2021
MCA exempts Foreign Cos. from applicability of provisions of Section 387 to 392 relating to prospectus in IFSCs
Editorial Note: The Central Government has exempted foreign companies and companies incorporated or to be incorporated outside India from the applicability of the provisions of sections 387 to 392 (both inclusive), with respect to the prospectus, and all matters incidental thereto in the International Financial Services Centres set up under section 18 of the Special Economic Zones Act, 2005.
NOTIFICATION NO. SEBI/LAD-NRO/GN/2021/36, DATED 05-08-2021
SEBI tweaks Mutual Funds norm to allow forfeiture of amount invested by AMCs for violating code of conduct
Editorial Note: The SEBI has notified the Securities and Exchange Board of India (Mutual Funds) (Second Amendment) Regulations, 2021. Regulation 76 has been substituted to allow SEBI to pass order to forfeit amount invested by AMCs for violating Code. Also Sub-regulation (16A) has been inserted to regulation 25 providing that AMC shall invest such amounts in such schemes of the mutual fund, based on the risks associated with the schemes, as may be specified by the Board from time to time.”.
NOTIFICATION NO. G.S.R. 538(E), DATED 05-08-2021
E-offering, subscription, and listing of securities in IFSCs shall not be construed as electronic mode for Foreign Cos.
Editorial Note: MCA has notified the Companies (Registration of Foreign Companies) Amendment Rules, 2021. Amendment adds an explanation to rule 2(1)(c) providing that electronic-based offering of securities, subscription thereof, or listing of securities in the IFSCs under SEZ Act, 2005 shall not be construed as ‘electronic mode’ as a place of business of a ‘foreign company’. The Companies (Specification of Definitions Details) Rules, 2014defines term’electronic mode’ in the context of a foreign company.
NOTIFICATION NO. SEBI/LAD -NRO/GN/2021/37, DATED 05-08-2021
SEBI amends prohibition of insider trading norms; raises maximum reward for informants to Rs. 10 crores
Editorial Note: The SEBI has amended the prohibition of insider-trading regulations to increase the maximum reward for informants to Rs. 10 crores from the existing upper limit of Rs. 1 crore. The amendment further provides that if the total reward payable is less than or equal to Rupees one crore, the Board may issue the reward upon the Board’s final order. ‘Informant’ is an individual(s), who voluntarily submits a voluntary information disclosure form relating to violation of insider trading laws to SEBI.
NOTIFICATION NO. SEBI/ LAD- NRO/GN/2021/39, DATED 09-08-2021
SEBI notifies norms on Issue and Listing of Non-Convertible Securities
Editorial Note: The SEBI has notified the SEBI (Issue and Listing of Non- Convertible Securities) Regulations, 2021. the regulations shall come into force on the 7th day from date of its publication in Official Gazette. The regulations prescribe norms relating to Eligibility criteria, public issue and listing of debt securities and non-convertibleredeemable preferenceshares (NCRPS), listing of private placement of debt securities and NCRPS, issuance, and listing of perpetual debt instruments, etc.
NOTIFICATION NO. SEBI/LAD- NRO/GN/2021/46, DATED 13-08-2021
SEBI eliminates requirement of continual disclosure from Takeover code
Editorial Note: The SEBI has notified the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2021 wherein the requirement of continuous disclosure by a person, persons acting in concert, and the promoter of every target company has been dispense with.
CIRCULAR NO. SEBI/HO/CFD /DIL/CIR/P/2021/614, DATED 13-08-2021
SEBI issues guidelines on issuance of non-convertible debt instruments along with warrants
Editorial Note: SEBI has issued guidelines for non-convertible debentures with warrants products, whereby it made the electronic book platform (EBP) mandatory for the non-convertible debt instruments(NCD) portion of the issue. The move is aimed at streamlining the procedure of issuance and applicability of the EBP mechanism on the NCDs portion. EBP platform mechanismshall bemandatory for NCDs portion of the issue (for both stapled and segregated offer, said SEBI.
NOTIFICATION NO. SEBI/LAD- NRO/GN/2021/42, DATED 13-08-2021
SEBI eliminates requirement of continual disclosure from Takeover code
Editorial Note: The SEBI has notified the SEBI (Substantial Acquisition of Shares and Takeovers) (Second Amendment) Regulations, 2021 wherein the requirement of continuous disclosure by a person, persons acting in concert, and the promoter of every target company has been dispense with.
CIRCULAR NO. SEBI/HO/CFD/ DIL /CIR/P/2021/614, DATED 13-08-2021
SEBI issues guidelines on issuance of non-convertible debt instruments along with warrants
Editorial Note: SEBI has issued guidelines for non-convertible debentures with warrants products, whereby it made the electronic book platform (EBP) mandatory for the non-convertible debt instruments(NCD) portion of the issue. The move is aimed at streamlining the procedure of issuance and applicability of the EBP mechanism on the NCDs portion. EBP platform mechanismshall bemandatory for NCDs portion of the issue (for both stapled and segregated offer, said SEBI.
NOTIFICATION NO. SEBI/LAD- NRO/GN / 2021/42, DATED 13-08-2021
Now listed entities are not required to disclose information relating to credit rating in their financial statements: SEBI
Editorial Note: The SEBI has amended the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 wherein rule 52 has been amended. As a result, listed entities while submitting half yearly / annual financial results, are not required to disclose information related to credit rating and change in credit rating (if any), asset cover available, in case of non-convertible debt securities, and previous due date for the payment of interest/ dividend.
NOTIFICATION NO. SEBI/LAD-NRO/GN/2021/45, DATED 13-08-2021
SEBI reduces lock-in period for promoter contribution from 3 years to 18 months
Editorial Note: The SEBI has notified the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Third Amendment) Regulations, 2021 wherein regulation 16 for lock-in period of specified securities held by promotor has been amended. As a result lock-in period ofminimum promoters’ contribution has beenreduced to 18 months from a period of three years from the date of commencement of commercial production or date of allotment in the initial public offer, whichever is later.
CIRCULAR NO. SEBI/HO/IMD1/DOF1/OW/P/2021/1 7965, DATED 05-08-2021
Investment advisers are not allowed to charge ‘implementation fee’ for their clients: SEBI clarifies
Editorial Note: The SEBI has issued clarification though informal guidance sought by Vansh Capital Private Limited with respect to ‘implementation fee’ for advisory clients whereby it has clarified that Investment advisers are allowed to provide the implementation services to its clients, but It cannot receive any direct or indirect consideration for such services at any point of time including advisory service period.
MCA mandates Cos to disclose details of Crypto Currency and CSR in financial Statements:
Editorial Note: Union Minister of State for Corporate Affairs Shri Rao Inderjit Singh in a written reply to a question in Rajya Sabha stated that, in order to bring in greater
transparency in reporting of financial statements, the Ministry of Corporate Affairs vide notification dated 24.03.2021 has amended the Schedule III to the Companies Act, 2013 effective from 01st April 2021 to mandate various disclosures by companiesrelating to virtualcurrency and CSR in their financial statements.
NOTIFICATION NO. SEBI/LAD-NRO/GN/2021/40, DATED 13-08-2021
SEBI notifies single regulations on Share Based Employee Benefits and Sweat Equity
Editorial Note: The Market Regulator, SEBI has merged of SEBI (Issue of Sweat Equity) Regulations, 2002 and SEBI (Share Based Employee Benefits) Regulations, 2014 into a single regulation called the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021. The new regulation has provided flexibility in switching the administration of their schemes from the trust route to the direct route and vice versa.
NOTIFICATION NO. SEBI/LAD-NRO/GN/2021/44, DATED 13-08-2021
SEBI eases eligibility norms for acquiring or holding shares Editorial Note: The SEBI has notified the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Second Amendment) Regulations, 2021 wherein norms related to acquiring or holding shares has been amended. Now, a person can acquire shares for intermediators without seeking prior approval of the Board.
CIRCULAR NO. SEBI/HO/MIRSD/MIRSD_CRADT/C IR/P/2021/618, DATED 13-08-2021
SEBI asks depositories to create, host, and maintain a system using ‘Distributed Ledger Technology’
Editorial Note: In order to strengthen the process of security creation, monitoring of security created, monitoring of asset cover and covenants of the non-convertible securities, the SEBI has asked depositories to create, host, and maintain a system using the distributed ledger technology. The new system shall come into effect from April 01, 2022. However, testing of the system shall start from January 01, 2022.
CIRCULAR NO. SEBI/HO/CFD/DCR-III/CIR/P/2021/ 615, DATED 13-08-2021
SEBI revises procedure for tendering and settlement of shares through Stock Exchange
Editorial Note: In order to reduce the systematic risk and risks associated with the movement of securities from the demat account of shareholders to Clearing Corporation account and vice-versa, the SEBI has amended the procedure for tendering and settlement of shares through Stock Exchange. The said revised mechanism shall be applicable to all the tender offers for whichPublic Announcement is made on or after October 15, 2021.
CIRCULAR NO. SEBI/HO/CFD/CMD/CIR/P/2021/61 6, DATED 13-08-2021
SEBI revises format for disclosure of shareholding pattern of promoters and promoter group entities
Editorial Note: In the interest of transparency to the investors, the SEBI has revised format for disclosure of shareholding pattern. Consequently, all listed entities are now provide shareholding, segregated into promoter(s) and promoter group. At present, the shareholdings of promoter(s) and promoter group entities are collectively disclosed showing shareholding pattern of the Promoter and Promoter Group’.
CIRCULAR NO. SEBI/HO/CDMRD/DRMP/CIR/P/2021/619, DATED 17-08-2021
SEBI specifies additional penalty for repeated delivery default .
Editorial Note: To put in place a suitable deterrent mechanism to address instances of repeated delivery defaults, the SEBI has specified that it will impose an additional penalty of 3% of the total value of the delivery default in the case of ‘repeated default’ by a seller or a buyer.
NOTIFICATION NO. G.S.R. 580(E), DATED 19-08-2021
MCA amends norms relating to creation and maintenance of databank of independent directors
Editorial Note: MCA has notified the Companies (Creation and Maintenance of databank of Independent Directors) Second Amendment Rules, 2021. A new rule 6 has been inserted requiring the Institute to submit an annual report on the capacity building of independent directors within 60 days from the end of every financial year to every individual whose name is included in the data bank and also to every company in which such individual is appointed as an independent director in prescribed format.
NOTIFICATION NO. G.S.R. 579(E). DATED, 19.08.2021
MCA tweaks norms relating to appointment of Independent Directors
Editorial Note: MCA has notified the Companies (Appointment and Qualification of Directors) Amendment Rules, 2021 whereby rule 6 has been amended to exempt (a) an advocate of a court; or (b) in practice as a chartered accountant; or (c) in practice as a cost accountant; or (d) in practice as a company secretary having 10 years of experience from passing online proficiency self-assessment test.
CIRCULAR NO. SEBI/HO/IMD/IMD-I/DOF1/P/CIR/2 021/622, DATED 31-08-2021
Now investment advisors can seek membership of BASL till Oct 31, 2021: SEBI
Editorial Note: In order to ensure compliance with Regulation 6(n) of the Investment Advisors (IA) Regulations and to keep their registration in force, all existing IAs were advised to seek membership of BASL within three months of the recognition of BASL i.e., by August 31, 2021. Now the SEBI has decided to extend the timeline for seeking membership of BASL by existing IAs by a period of two months till October 31, 2021.
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