Amendments in SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2010
Notification dated: 12th November, 2010
Highlights of the Amendments
| 1. |
Qualified Institutional Buyer: – The scope of term “Qualified Institutional Buyers†is widened by the introduction of “Insurance funds set up and managed by the Department of Posts India†in the said category. |
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| 2. | Retail Individual Investors : – Increase in Limit for Retail individual investors from one lakh rupees to two lakh rupees. | |
| 3. | Retail Individual shareholders: | |
| a. | Increase in Limit for Retail individual shareholders from one lakh rupees to two lakh rupees. | |
| b. | Deletion of below given criteria for the determination of Retail Individual Shareholder: | |
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| 4. | Public announcement with regard to the filing of Draft Offer Document with Board: | |
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The issuer filing the draft offer document with the Board is now required to give a public announcement either on the date of filing the draft offer document with the Board or on the next day in one English national daily newspaper with wide circulation, one Hindi national daily newspaper with wide circulation and one regional language newspaper with wide circulation at the place where the registered office of the issuer is situated, disclosing the fact of filing of draft offer document with the Board and for inviting comments from the public on the same. |
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| 5. | Monitoring agency : Insurance companies have been included in the category of monitoring agencies besides the Public Financial Institutions and schedules commercial banks for monitoring the use of proceeds of the Issue where the Issue size exceeds five hundred crores rupees. | |
| 6. | Conditions for Initial Public Offering: | |
| a. | Regulation 26(5) has been substituted with the following: | |
| “No issuer shall make an initial public offer if there are any outstanding convertible securities or any other right which would entitle any person with any option to receive equity sharesâ€. | ||
| b. | Clause c has been added in proviso to regulation 26(5): | |
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“fully-paid up outstanding convertible securities which are required to be converted on or before the date of filing of the red herring prospectus (in case of book-built issues) or the prospectus (in case of fixed price issues), as the case may be.†|
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| 7. | Submission of Compliance certificate by the Merchant Banker: The merchant bankers shall submit a compliance certificate in the format specified in Part D of Schedule XIII, for the period between the date of filing the draft offer document with the Board and the date of closure of the issue, in respect of news reports appearing in any of the following media: | |
| a. |
newspapers mentioned in sub-regulation (3) of regulation 9; |
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| b. |
major business magazines; |
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| c. |
print and electronic media controlled by a media group where the media group has a private treaty/shareholders’ agreement with the issuer or promoters of the issuer.†|
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| 8. |
Ineligibility of promoters for Preferential Issue in the following circumstances: |
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| a. | Where any person belonging to promoter(s) or the promoter group has sold his equity shares in the issuer during the six months preceding the relevant date, the promoter(s) and promoter group shall be ineligible for allotment of specified securities on preferential basis.†| |
| b. | Where any person belonging to promoter(s) or the promoter group has previously subscribed to warrants of an issuer but failed to exercise the warrants, the promoter(s) and promoter group shall be ineligible for issue of specified securities of such issuer on preferential basis for a period of one year from: | |
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| 9. | In Addition to the above, certain changes have been made in Schedule VIII of the Regulations. | |
Team Corporate Professionals