Securities and Exchange Board of India

On 17-05-2024, the Securities Exchange Board of India issued the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2024 to amend the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Amendments in Regulations 3, 17, 21(5), 25, 30, 34, 43-A, and 44 will come into force from 31-12-2024. Other provisions came into effect on 17-5-2024.

Key Points:

  1. Earlier, Regulation 3(2) entailed that the provisions of these regulations which become applicable to listed entities on the basis of market capitalisation criteria will continue to apply to such entities even if they fall below such thresholds.

    Now, it lays down that:

    • On December 31st, stock exchanges will have to prepare a list of entities and these entities will be ranked on the basis of their average market capitalisation.

    • After 3 months from December 31st, the relevant provisions will become applicable to a listed entity which is required to comply with the requirements.

    • Any entity complying for the first time or after a period of cessation will systems and processes for compliance with Regulation 34(2)(f) within 3months from December 31 or the beginning of the immediate next financial year.

    • Disclosures to be made as per the Business Responsibility and Sustainability Report Core annually.

  2. The amendment s inserts sub-regulations (2A) and (2B) which state that:

    • In case of change of rank, the entity will fall outside the purview of the provisions which become applicable to a listed entity based on the market capitalisation.

    • The provisions will cease to apply at the end of the financial year after December 31st of the third consecutive year.

  3. A new proviso has been inserted to Regulation 26A (1), providing that the vacancies shall be filled up by the listed entity at the earliest and not later than six months from the date of the vacancy where it is required to take the approval of the regulatory, government or statutory authorities to fill up such vacancies. The same proviso has been inserted in Regulation 26A (2).

  4. A new proviso to Regulation 29(1) has been inserted which states that if a placement is done according to the provisions of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018, no intimation regarding the determination of issue price in a qualified institutions placement is required.

  5. Two new clauses have been inserted in regulation 29(1) providing about inclusion of proposals wherein:

    • There takes place any alteration in the form or nature of any security of the listed entity this is listed on the stock exchange or in the rights or privileges of the holders.

    • Where any alteration is made in the date on which the interest on debenture or bonds or even the redemption amount of redeemable shares or of debentures of bonds become payable.

  6. A new proviso to Regulation 30(11), has been inserted providing that when the listed entity confirms any reported event or information, on which pricing norms provided under legislations as mentioned in the proviso are applicable, within 24 hours, then the effect on the price of the equity shares of the listed entity due to the material price movement and confirmation of the reported event or information may be excluded for calculation of the price for that transaction.

  7. Regulation 30 (11A) has been inserted which states that the promoter, director, key managerial personnel, or senior management of a listed entity must provide adequate, accurate, and timely response to the queries or explanation sought by the listed entity so that sub-regulation 11 is complied with, and such information should be shared by the listed entity to the stock exchanges.

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