Sebi board may discuss NSE IPO, Related party transaction and review of shareholding pattern for MIIs

(Reported by Tarun Sharma)

The board of Securities and Exchange Board of India (Sebi) may discuss whether regulator should commence the process of National Stock Exchange’s offer for sale. Along with this regulator has a plan to wider the scope of definition of related party transaction and Sebi may discuss shareholding norms for market institutional infrastructure (MIIs).

Sebi board is meeting on September 28th for taking several market related agenda in board meeting.

See Zee Business Live TV Streaming Below:

A source close to development told Zee Business “Sebi should allow to NSE to file Draft Red Herring Prospectus (DRHP) for their Offer for sale (OFS) despite of cases are pending with regulator in several department”.

Source further added that “As per internal circular, Sebi does not give any approval for IPO or OFS where companies have not complied Sebi orders. Even Adjduction penalty is pending there also regulator does not give any clearances. Here, several cases are pending and NSE selectively challenged the order of Sebi in courts. In this condition, whether regulator can commence the process of OFS or not might be discussed with board”.

Sebi board may discuss third time in the board about review of ownership and governance norms for facilitating new entrants to set up stock exchange and depository.

A source close to development told Zee Business that “Market Regulation Department may give presentation to board on discussion paper which was issued in January this year. However, this time some amendments is expected on shareholding criteria and MII’s can be merged which was earlier not in discussion paper”.

Sebi may widen the scope of related party transaction. Sebi came out with discussion paper last year after working group submitted their report.

As per working group has proposed a modification in the definition of “Related Party” to include within its scope any person or entity belonging to the promoter or promoter group of the listed entity, irrespective of its shareholding. As per current requirement, such person or entity is required to hold 20% or more shareholding of the listed entity, which is proposed to be omitted. Secondly, covering transactions between the listed entity or any of its subsidiaries on the one hand and a related party of the listed entity or any of its subsidiaries on the other.

Sebi May finalise framework and timeline of implementation of social stock exchange which was proposed in union budget of 2019-20.

Along with this, Sebi has a plan to some amendments in Foreign portfolio investor category 3 and proposal is being placed for enactment of superannuation scheme for Sebi employees.