SEBI issues the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Fourth Amendment) Regulations, 2020
These Regulations will now be applicable to a rights issue by a listed issuer; where the aggregate value of the issue is INR 50 crore or more. Further, in case of rights issue of less than INR 50 crore, the issuer shall prepare the letter of offer in accordance with requirements and file the same with SEBI, for information and dissemination on the SEBI’s website. Prior to this amendment, the aggregate value of the right issue was required to be INR 10 crore or more and the present amendment has enhanced this value to INR 50 crore or more. In respect of the general conditions of the rights issue, the Amendment Regulations explain the concept of ‘finance for the specific project’ to mean finance of capital expenditures only. Prior to this amendment, there was no explanation provided for this term. The Amendment Regulations have brought sweeping changes and have thoroughly revised the provisions relating to disclosures in the letter of offer. Part B of Schedule VI has been revised by virtue of this amendment and Part B -1 has been inserted.
SEBI extends time limit for bond submission by trading members till 31st October.
SEBI has decided to provide flexibility to the SEs/ CCs for modifying the Undertaking cum Indemnity bond they need to take from TMs/ CMs and suitably modify the draft undertaking wherever required.
SEBI further extends the timelines for compliance with the regulatory requirements by the trading members/clearing members.
The timeline for maintaining call recordings of orders/instructions received from clients has been extended up to 31st December 2020.
SEBI grants relaxation with respect to validity of SEBI observations and revision in issue size.
The validity of SEBI observations which is expiring between 1st October, 2020 and 31st March, 2021 has been extended till 31st March, 2021 subject to an undertaking from lead manager to the issue confirming compliance with Schedule XVI of the ICDR Regulations, 2018 while submitting the updated offer document to the Board.
SEBI relaxes its Guidelines for preferential issue and institutional placement of units by a listed REIT
Real Estate Investment Trusts (REITs) are now permitted to make institutional placements two weeks after the date of prior institutional investment. Prior to this amendment, the Guidelines had stipulated for a gap of six months between two institutional placements. Further, the amendment provides that the REIT can opt for a pricing method for any preferential issues made during the period beginning from 28th September 2020 to 31st December 2020. In this regard, SEBI has specified the pricing method to be followed.
SEBI amends Operating Guidelines for Investment Advisers in IFSC
In addition to the companies and LLPs, the amendment now also permits ‘other similar structures recognised under the laws of the parent jurisdiction’ to apply for registration as Investment Advisers in IFSC. The amendment further clarifies that there is no necessity of forming a separate company or LLP in cases where the applicant is already a company of LLP in IFSC. Clause 4 has been amended to clarify that when IAs offer investment advisory services to persons resident outside India or non-resident Indians they must comply with guidelines issued by the relevant overseas regulator or authority. The present amendment has also clarified that either the IAs or the parent entity must fulfil the net worth requirement which is presently fixed at USD500,000. The requirement must be met separately and independently for each activity undertaken by it under the relevant regulations.
SEBI issues an Advisory on Recovery of Assets of Defaulter Members of Stock Exchanges and of Debit Balance Clients
Through this Circular SEBI categorically advises Stock Exchanges and Clearing Corporations to initiate suitable action for liquidating assets of the defaulter member and of the debit balance clients. This action must be initiated before the appropriate court within six months from the declaration of the member as a defaulter. Additionally, such action extends to both movable and immovable assets of the defaulter member, which are not in possession of the SE/ CC. Moreover, the recovery of the funds of the debit balance clients will be limited only to the extent of the debit balance.
SEBI relaxes its Guidelines for preferential issue and institutional placement of units by a listed InvIT
Infrastructure Investment Trusts (InvITs) can now make institutional placements two weeks after the date of prior institutional investments. Prior to this amendment, the Guidelines had stipulated for a gap of six months between two institutional placement. Further, the amendment provides that the InvIT can opt for a pricing method in case of any preferential issues made during the period beginning from 28th September 2020 to 31st December 2020. In this regard, SEBI has specified the pricing method to be followed.
SEBI to rationalize eligibility criteria and disclosure requirements for Rights Issues
The SEBI has decided to amend SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 to rationalize eligibility criteria and disclosure requirements for Rights Issues. The amendments will be effective from the date it is notified in the Gazette. The amendment is proposed with an objective to make the fund raising through this route, easier, faster and cost effective.
SEBI provides for System-Driven Disclosures (SDD) of the PAN of the promoters under SEBI (SAST) Regulations, 2011
This circular provides for capturing the PAN of the promoters from listed companies as mentioned in para 2,3 & 4 of the Annexure A of the circular dated September 09, 2020 for SAST disclosures too.
