On 10 October, SEBI issued guide on minimum shareholding compliance.
- Covers non-compliance with the minimum public shareholding (MPS) requirements.
- Set out procedure that must be followed in respect of non-compliant listed entities.
- Stock exchanges to review MPS rule compliance, based on shareholding pattern etc.
- Within 15 days from observation of non-compliance, shall issue notice to the entity.
- In case of non-compliance, impose fine of 5,000 rupees per day of non-compliance.
- Depositories to freeze promoter, promoter group shareholding, pending compliance.
- Promoter, promoter group, directors not to hold new positions until entity complies.
Over 1 Year
- Increased fine of 10,000 rupees per day of non-compliance until date of compliance.
- Depositories to freeze all promoter and promoter group securities in Demat account.
- Stock exchange may also consider compulsory de-listing of the non-compliant entity.
- Stock exchanges shall periodically disclose on their website names of non-compliant
entities, size of fine, freezing of shares, other action and status of entity compliance.
- Circular to come into force with immediate effect.