SEBI has approved several rules changes while tightening the disclosure norms for IPOs. SEBI’s board of directors in a meeting held here on Friday approved a proposal to introduce an alternative mechanism by allowing companies looking to submit preliminary documents for IPOs to confidentially submit regulatory information.
The Securities and Exchange Board of India (Sebi) has approved changes in several rules, including tightening of disclosure requirements for initial public offerings (IPOs)
According to SEBI, it is mandatory for the issuer to disclose the offer value based on past transactions and fund raising activities.
SEBI’s board of directors in a meeting held here on Friday approved a proposal to introduce an alternative mechanism by allowing companies looking to submit preliminary documents for IPOs to confidentially submit regulatory information.
The market regulator has also decided to make major changes to bring more flexibility in the structure of Offer for Sale (OFS). This includes doing away with the minimum shareholding requirement for non-promoter shareholders.
At present, non-promoter shareholders willing to offer at least 10 per cent stake in a company and shares worth Rs 25 crore are eligible to participate in the OFS framework.
Apart from this, the capital market regulator has also decided to introduce a two-tier verification process for trading in mutual fund units to safeguard the interest of investors. SEBI said that the new draft in this regard will be implemented from April 1 next year.
At present, all Asset Management Companies (AMCs) are required to verify the withdrawal transactions by two-stage verification for online transactions and signature for offline transactions.
“It has now been decided that two-way verification will be extended to the transaction of purchase of units of mutual funds also,” SEBI said.
The market regulator has also decided to relax the pricing norms for open offers in respect of disinvestment of public sector undertakings.
In addition, SEBI will introduce a regulatory framework to facilitate providers of online bond platforms to sell listed debt securities.
Under the framework, such forums should be run by a SEBI registered broker as a Stock Broker (Loan Segment) or registered with SEBI.
The meeting also decided to extend the deadline by two months to November 30 for implementation of the standardized framework for industry classification by credit rating agencies.
This framework is for rating exercise and research activities and its deadline was to end on Friday itself.
SEBI has also approved the introduction of a new option for the appointment and removal of independent directors from the board of directors of companies. The move will provide flexibility in the approval process for the appointment or removal of independent directors.
