Sebi drops certain disclosure requirements for promoters upon share acquisition

By: |
August 17, 2021 4:05 PM

The Securities and Exchange Board of India (Sebi) has amended the takeover regulations because of the implementation of the System Driven Disclosures (SDD).

sebi disclosuresThe new rule has become effective from August 13

Capital markets regulator Sebi has removed certain disclosure requirements for acquirers and promoters of companies.

The Securities and Exchange Board of India (Sebi) has amended the takeover regulations because of the implementation of the System Driven Disclosures (SDD).

Under the new rule, certain disclosure obligations for the acquirers/ promoters on acquisition or disposal of shares aggregating to 5 per cent and any change of 2 per cent thereafter, annual shareholding disclosures and creation or invocation or release of encumbrance registered in depository systems under takeover regulations would not be applicable.

The amendment will be effective from April 1, 2022, the regulator said in a notification, dated August 13.

The development came after the board of Sebi approved a proposal in this regard earlier this month.

Under SDD, relevant disclosures are disseminated by the stock exchanges based on the aggregation of data from the depositories without human intervention.

The SDD for the said disclosures is already in place and runs parallel with the submission of physical disclosures under the takeover regulations, Sebi had said in its board meeting.

The obligation for physical disclosures would be done away with effect from April 1, 2022, it had added.

Separately, the regulator has amended the regulations on listing obligations and disclosure requirements.

These relate to issuers who have listed non-convertible debt securities, non-convertible redeemable preference shares, perpetual debt instruments and/ or perpetual non-cumulative preference shares.

These amendments are aimed at improving transparency, rationalisation and removing redundant provisions to provide further robustness to the corporate bond market.

With regards to documents and information to holders of non-convertible securities, Sebi said the listed entity will have to send soft copies of the full annual reports to all the holders of such securities who have registered their email address either with the listed entity or with any depository.

The new rule has become effective from August 13.

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