Listed firms allowed to delay AGMs by a month, SEBI eases norms for companies under lockdown

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Updated: March 26, 2020 4:27:06 PM

According to the circular issued by the market regulator, top 100 listed companies by market capitalisation will get a one month relaxation on holding of Annual General Meeting (AGM).

Coronavirus lockdown, sebi, coronaviruas pandemic, coronavirus infection, stock markets, latest news on sebiAGMs, under normal conditions are to be held by the end of August.

After having eased norms on financial result disclosure for listed companies, the Securities and Exchange Board of India (SEBI), Thursday provided further relaxation from compliance with certain provisions of the Listing Obligations and Disclosure Requirements (LODR). According to the circular issued by the market regulator, top 100 listed companies by market capitalisation will get a one month relaxation on holding of Annual General Meeting (AGM). Further listed entities will also get a one month breather on following the regulation 40(9), according to the SEBI issued circular. The move comes as India continues to practice a 21-day lockdown, in order to curb the spread of Coronavirus pandemic.

AGMs, under normal conditions are to be held by the end of August, however, under the extension provided the same can be done till September, 30. Under Regulation 40(9), listed entities have to ensure a Company Secretary provides a certificate stating that all share certificates have been timely issued within one month of the end of each half of the financial year. With the fresh relaxation, companies clutched by the lockdown across the country will breathe a sigh of relief as they struggle to comply with various norms under a lockdown. The announcement by SEBI comes on the same day when Finance Minister Nirmala Sitharaman announced a Rs 1.7 lakh crore relief package for the poor. 

Committee meetings that are conducted by listed firms have also been given a 3-month extension by the market regulator. The meeting of the nomination and remuneration committee, Stakeholder relation committee and the risk management committee — having a requirement to meet at least once a year — can now be held till the end of June this month. SEBI’s January 20 circular about the  Standard Operating Procedure (SoP) on imposition of fines and other enforcement actions for non-compliances with provisions of the LODR too has been postponed till June 30 this year. 

SEBI in its circular pointed out that listed companies, that are required under the LODR to publish information relating to declaration of quarterly and board meeting, shall be exempted from doing so till the  middle of May 2020.

The Market regulator had earlier last week allowed listed companies to defer disclosure of results for the fourth quarter of this fiscal and the yearly results. Under the 21-day lockdown businesses, unless under the essential services category, will have to make their employees work from home. SEBI has also been asked by the stock brokers association, Anmi to consider a systematic closure of the stock markets, according to news agency PTI. Reportedly stock brokers have been struggling to reach their offices during the lockdown period.

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