SEBI broadly took the following decisions, which can reap better benefits for the investors’ community and the small shareholders:

• Insider Trading Regulations:
• Review of the 22 year old Insider Trading Regulations: The said Regulations were promulgated in 1992 and over the years, the capital markets scenario has changed a lot, so this overhauling is a welcome move;
• Insiders’ definition to be widened: It is proposed to include not just the employees, but also contractual employees and intermediaries within the ambit: Now, these intermediaries would not be able to take the excuse that they do not fall within the definition of insider and if they traded on the basis of any unpublished price sensitive information, they would be held liable;
• Insiders to formulate pre scheduled trading plans, to be duly disclosed to the Stock Exchanges: This will be allowed for genuine and bona fide transactions.
• Burden of proof that the concerned Noticee was not in possession of any unpublished price sensitive information, shall be on the Noticee: That is to say, now, it will be for such persons to prove that while doing the trade, they were not in possession of any unpublished price sensitive information.
• Clarity as to what would tantamount unpublished price sensitive information (UPSI): It is proposed to link it with listing agreement thereby widening the ambit of price sensitive information.
• Delisting Regulations:
• For delisting to be successful, the Promoters’ holding after the offer shall reach the threshold of 90%, and atleast 25% of the total number of public shareholders in the Company should tender their shares. Further, the offer price shall be the price at which the Promoters’ holding (alongwith tendered shares) reaches the said level: These decisions will give the public shareholders a better command to decide upon the listed fate of the companies. However, from the industry point of view, the Acquirers/ the Promoters might again find it difficult to attain success of offer, since atleast 25% of the headcount of public shareholders, that too holding the shares in demat mode, should tender their shares. In many illiquid/ suspended scrips, the public shareholders are still non traceable and in such a situation, it might be difficult to garner the 25% headcount.
• Companies, wherein the Promoters have sold any shares during preceding 6 months shall be prohibited from making a delisting offer: This will prevent pre delisting manipulative transactions, which again will be in the ultimate benefit of the public shareholders.
• Tendering of shares under the Delisting/Takeover/Buyback offers to be done through the Stock Exchanges: This is the most welcome move taken by the Regulator. This was a long drawn demand from the Investors community that tendering of shares under these offers should not attract Capital Gains (CG) Tax, but the Securities Transaction Tax (STT). Until now, the investors by tendering their shares under these offers had to pay a much heavy CG Tax as against the very nominal STT. Now, SEBI has accepted this recommendation and the shareholders will now have to shell out much lesser amounts in the form of tax. This move, on one hand will be beneficial for the shareholders, and on the other would improve the prospects of successful delisting offers. In fact, in the past, it has been observed that in most such offers, the public shareholders were not keen in tendering for the reason of huge tax implications.
• Reducing the time line to 76 days: This will surely benefit the Companies as well as the shareholders who tender their shares in the delisting offers, as they will receive their monies faster.
• Conversion of Listing Agreements into Regulations

SEBI with the objective of ensuring better enforceability and at the same time compiling all the mandates of varied SEBI Regulations governing Equity as well as Debt segments of capital market under the ambit of a single document, has approved the proposal of conversion of Listing Agreement into Regulations to be known as SEBI (Listing Obligations and Disclosure Requirements) Regulations.

• Amendment in SEBI (Mutual Funds) Regulations, 1996

SEBI has proposed to permit the Asset Management Companies (“AMCs”) which are falling short of the prescribed net worth (i.e. Rs. 50 crore as per the SEBI (Mutual Fund) Regulations, 1996), to launch maximum of two mutual fund schemes per year till such shortfall continues. However, SEBI has reserved the discretion with it to grant of permission to the aforesaid AMCs.

• Amendment in SEBI (Settlement of certain Administrative and Civil Proceedings) Regulations, 2014 (“Regulations”)

In addition to the extant practice of settling administrative and civil proceedings wherein settlement process can be initiated by the concerned party/ies either Suo moto or on receipt of show cause notice (“SCN”), SEBI has now proposed that in case of minor violations, it will send before the issuance of show cause notice (“SCN”), intimation to the concerned parties about the impending enforcement actions decided to be taken. This will enable the concerned parties to seek settlement of proceedings or make voluntary submissions even prior to receipt of a detailed SCN, thus, curbing the delay in conclusion of proceedings and resultant wastage of resources as well as time.

• Amendments in SEBI (Foreign Venture Capital Investors (“FVCI”)) Regulations, 2000 (“FVCI Regulations”)

With an intent to encourage investment in Infrastructure, SEBI has now allowed investment by FVCIs in all NBFC-CIC (core investment companies). Till date, investment in NBFCs-Equipment Leasing and Hire Purchase was only allowed.