The Securities and Exchange Board of India on 25th July 2022, has published the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) (Third Amendment) Regulations, 2022 through which a new chapter X-A dealing with social stock exchange has been notified.
The provisions of this Chapter shall apply to:
(a) a Not for Profit Organization seeking to only get registered with a Social Stock Exchange;
(b) a Not for Profit Organization seeking to get registered and raise funds through a Social Stock Exchange;
(c) a For Profit Social Enterprise seeking to be identified as a Social Enterprise under the provisions of this Chapter.
Social Stock Exchange means a separate segment of a recognized stock exchange having nationwide trading terminals permitted to register Not for Profit Organizations and / or list the securities issued by Not for Profit Organizations in accordance with provisions of these regulations.
A Social Stock Exchange shall be accessible only to institutional investors and non-institutional investors: Provided that the Board may permit other class(es) of investors, as it deems fit, for the purpose of accessing Social Stock Exchange
Every Social Stock Exchange shall constitute a Social Stock Exchange Governing Council to have an oversight on its functioning. The composition and terms of reference for such Governing Council shall be specified by the Board from time to time.
Not for Profit Organization shall mandatorily seek registration with a Social Stock Exchange before it raises funds through a Social Stock Exchange: Provided that a Not for Profit Organization may choose to register on a Social Stock Exchange and not raise funds through it. The minimum requirements for registration of a Not for Profit Organization on a Social Stock Exchange shall be specified by the Board from time to time.
