Sebi Board Meeting Outcome 28 September 2021: Major decisions taken! Here are 12 key takeaways

Markets regulator Securities and Exchange Board of India (Sebi)'s Board met in Mumbai on Tuesday  under  the Chairmanship   of  Ajay  Tyagi.  The Part-Time Members  joined  the SEBI board meeting  through  video conferencing. Sebi Board in its meet took some major decisions. Here we have compiled the complete list of 12 key takeaways: - 

1 - Proposed  framework  for  Gold  Exchange  and  SEBI  (Vault  Managers) Regulations, 2021: 

The Board,  afterdeliberations, approved the framework for Gold Exchange and SEBI (Vault Managers) Regulations, 2021.

2- Framework for Social Stock Exchange: 

The Board approved the creation of the Social Stock Exchange (SSE), under the  regulatory  ambit  of  SEBI,  for  fund  raising  by  social  enterprises  (SE).  The framework   for   the   SSE   has   been   developed   on   the   basis   of   the recommendations of a working group and a technical group constituted by SEBI. 

3-Review of delisting framework pursuant to open offer: 

The Board approved the proposal to amend the existing regulatory framework for delisting of equity shares pursuant to open offer as provided underthe extant Regulation 5A of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (Takeover Regulations).

4-Review of certain provisions related to Superior Voting Rights Shares Framework: 

The Board decided to relax the eligibility requirements related to Superior Voting Rights (SR) Shares framework.

5-Review of regulatory provisions on Related Party Transactions: 

The  Board  considered  and  approved  the  amendments  to  SEBI  (Listing Obligations  and  Disclosure  Requirements)  Regulations,  2015,  in  relation  to regulatory provisions on related party transactions (RPTs).

6- Investor Charter for Securities Market: 

The Board considered and approved an Investor Charter of SEBI for investors in  the  securities  market. The  Investor  Charter,  inter-alia,  includes  the  Vision statement of SEBI for investors.  Mission statement, Rights and Responsibilities of Investors,Do’s and Don’ts for investors in securities market, etc.

7- Amendment to SEBI (Alternative Investment Funds) Regulations, 2012: 

The  Board  approved  amendment  to  SEBI  (Alternative  Investment  Funds) Regulations, 2012 allowing Category III AIFs to calculate concentration norms based on Net Asset Value of the fund instead of investable funds for investment in listed equities of investee companies.

8-Introduction of Silver Exchange Traded Funds in India: 

The Board approved amendment to SEBI (Mutual Funds) Regulations, 1996 to enable introduction of Silver Exchange Traded Funds with certain safeguards in line with the existing regulatory mechanism for Gold ETFs

9- Amendments  to  SEBI  (Portfolio  Managers)  Regulations,  2020  and  SEBI (Alternative Investment Funds) Regulations, 2012:

The Board approved amendments to the SEBI (Portfolio Managers) Regulations,2020 and the SEBI (Alternative Investment Funds) Regulations, 2012, to facilitate Co-investment  by  investors  of  Alternative  Investment  Funds  (AIF)  through portfolio  management  route. The  Portfolio  Manager  providing  Co-investment services  to  investors  of AIFs  shall  invest  100%  of  the  assets  under  their management   in   unlisted   securities   and   shall   be   exempted   from   certain requirements  under  SEBI  (Portfolio  Managers)  Regulations,  2020,  including minimum investment amount, minimum net-worth etc.

10-Permitting Resident Indians (other than Individuals) to become constituents of FPIs that are registered as AIFs in IFSCs: 

To  facilitate  investment  in  Indian  securities  markets  through  the  FPI  route  by Alternative  Investment  Funds  (AIFs)  set  up  in  International  Financial  Services Centres (IFSCs), the Board considered and approved the proposal to amend the SEBI  (Foreign  Portfolio  Investors)  Regulations,  2019  for  permitting  Resident Indians (other than individuals) to become constituents of FPIs that are registered as AIFs in IFSCs. Such Resident Indians shall be Sponsor/ Manager of the FPI and their contribution in the FPI shall be subject to conditions as specified by the Board.

11- Amendment  to  Schedule  II  of  Securities  and  Exchange  Board  of  India (Intermediaries) Regulations, 2008 -Criteria for determining ‘Fit and Proper Person’:

The Board considered and approved the agenda on criteria for determining ‘Fit and proper Person’.Fit  and  Proper  Person  criteria  shall  be  principle  based or/and rulebasedas applicable. The applicant or intermediary shall have competence and capability in  terms  of  infrastructure,  manpower  requirements  and  financial  soundness including  meeting  the  net  worth  requirement,  as  provided  in  the  regulations applicable to the applicant or the intermediary.The principle based criteria should include integrity, honesty, ethical behaviour, reputation, fairness and character.

12- Inclusion of Cost Accountants for share reconciliation audit under SEBI (D&P) Regulations, 2018:

The Board  deliberated  on  the  existing  provisions  of SEBI  (Depositories  and Participants) Regulations, 2018 [SEBI (D&P) Regulations, 2018],and approved the following proposal to authorize practicing Cost Accountants to carry out share capital reconciliation audit of issuer companies:-

Under the Regulation 76(1) of SEBI (D&P) Regulations, 2018, in addition to qualified Chartered Accountant or practicing Company Secretary, practicing Cost Accountants  are  also  eligible  to  carry  out  share  reconciliation  audit  of  issuer companies.