TMI BlogAMENDMENTS TO SEBI (DISCLOSURE AND INVESTOR PROTECTION) GUIDELINES, 2000X X X X Extracts X X X X X X X X Extracts X X X X ..... is, however, processed by SEBI and stock exchanges in a manner similar to that of a draft IPO document. ( b ) It is felt that there is a need to enable well established and compliant listed companies to access Indian primary market in a time effective manner through follow-on public offerings and rights issues. Accordingly, it has been decided to enable listed companies satisfying certain specified requirements to make Fast Track Issues (FTIs). ( c ) The amendments made vide this circular enable such listed companies to proceed with follow-on public offering/rights issue by filing a copy of the Red Herring Prospectus (in case of book built issue)/Prospectus (in case of fixed price issue) registered with the Registrar of Companies or the letter of offer filed with Designated Stock Exchange, as the case may be, with SEBI and stock exchanges. Such companies are not required to file draft offer document with SEBI and stock exchanges. ( ii ) Amendments to Guidelines on Issue of Indian Depository Receipts (IDRs) - Presently, SEBI (DIP) Guidelines provide that only Qualified Institutional Buyers (QIBs) can apply in an IPO of IDRs. It has been decided to amend SEBI ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... blic issue for value not exceeding ₹ 1,00,000. ( vi ) Clarification on the term CEO/CFO - SEBI (DIP) Guidelines requires all directors, CEO and CFO of the issuer company to certify that disclosures made in the offer document are true and correct. It is now clarified that the terms CEO and CFO in SEBI (DIP) Guidelines shall have the same meaning as assigned to them in clause 49 of the Equity Listing Agreement. ( vii ) Deletion of the chapter on Guidelines for Issue of Capital by Designated Financial Institutions (DFIs) - SEBI had introduced separate guidelines in 1992 for primary issuances by DFIs, to place companies/corporations/institutions engaged mainly in financing of developmental activities and playing a catalytic role in the infrastructure development of the country on a different footing. Presently, DFIs operationally compete on equal footing with private entities and it is felt that DFIs, as a concept, may have outlived its utility. It has therefore been decided to remove the special dispensations given to DFIs by deleting the chapter on Guidelines for Issue of Capital by DFIs from SEBI (DIP) Guidelines. ( viii ) Monitoring of issue proceeds ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents to clauses 5.3.3, 6.8.4.1 and 6.12.4 shall be applicable to all draft offer documents filed with SEBI after the date of this circular. ( iii ) All other amendments shall come into force with immediate effect. 4. This circular and the entire text of SEBI (DIP) Guidelines, including the amendments issued vide this circular, are available on SEBI website at www.sebi.gov.in under the categories Legal Framework and Issues and Listing. 5. All registered merchant bankers are directed to ensure compliance with the applicable amendments made vide this circular. Yours faithfully, Neelam Bhardwaj Encl.: Annexure I Annexure I Amendments to SEBI (DIP) Guidelines, 2000 Chapter I Preliminary 1. In clause 1.2.1, after sub-clause ( xiib ), the following sub-clause shall be inserted, namely:- ( xiic ) Fast Track Issue means a public issue or rights issue made by a listed company which satisfies all the requirements of clause 2.1.2A. 2. In clause 1.2.1, after sub-clause ( xxiva ), the following sub-clause shall be inserted, namely:- ( xxivb ) Retail Individual Shareholder means a shareholder of a listed company, who - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company or its promoters or whole time directors as on the reference date; and ( h ) The entire shareholding of the promoter group is held in dematerialised form as on the reference date. Explanation - For the purposes of this clause : ( a ) Reference date shall mean : ( i ) in case of a public issue of securities by a listed company satisfying all the requirements specified in this clause, the date of filing of red herring prospectus (in case of a book built issue) or prospectus (in case of a fixed price issue) with ROC; and ( ii ) in case of a rights issue of securities by a listed company satisfying all the requirements specified in this clause, where the aggregate value of such securities, including premium, if any, exceeds ₹ 50 lakhs, the date of filing of letter of offer with Designated Stock Exchange. ( b ) Average market capitalisation of public shareholding shall mean the sum of daily market capitalization of public shareholding for a period of one year up to the end of the quarter preceding the month in which the proposed issue was approved by the Board/shareholders, as the case may be, divided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in requirements 8. Clauses 4.13 and 4.13.1 and the proviso to the latter shall be omitted. Chapter V Pre-issue obligations 9. In clause 5.2, the following sentence shall be inserted at the end, namely :- In case of a fast track issue, the requisite fee shall be paid along with the copy of the red herring prospectus, prospectus or letter of offer, as the case may be, filed under clause 2.1.2A.2. 10. In clause 5.3.2.2, the following proviso shall be inserted, namely :- Provided that in case of a fast track issue, inter se allocation of responsibilities (Schedule II) shall not be submitted to the Board. 11. In clause 5.3.3.1, for the word prospectus , the words offer document shall be substituted. 12. Clause 5.3.3.1A shall be renumbered as clause 5.3.3.1B and after the words along with the draft offer document and before the full stop, the words or in case of a fast track issue, along with the copy of the red herring prospectus, prospectus or letter of offer filed under clause 2.1.2A.2 shall be inserted. 13. The following shall be inserted before the renumbered clause 5.3.3.1B, namely:- 5.3.3.1A In case of a fast track iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .1 Nothing contained in clauses 5.3.1.3, 5.3.3.1, 5.3.3.2, 5.3.4.1, 5.3.5.1, 5.3.6.1, 5.3.6.2 and sub-clauses ( i ) and ( iii ) of clause 5.6.2 shall apply to a fast track issue. Chapter VI Contents of offer document Section I - Contents of the prospectus 22. In clause 6.3 - ( i ) before the existing first proviso, the following proviso shall be inserted, namely :- Provided that nothing contained in sub-clauses ( a ) and ( j ) of clause 6.8.3.2 and clause 6.9.5.8 and nothing contained in clause 6.10.3.1 in respect of entities not covered under section 370(1)(B) of the Companies Act, 1956 shall apply to a listed company satisfying all the requirements specified in clause 2.1.2A.1. ( ii ) in the existing 1st proviso, for the words Provided that in case of a public issue by listed company , the words Provided further that in case of a public issue by a listed company other than a fast track issue shall be substituted. ( iii ) in the existing second proviso, for the word aforesaid , the word second shall be substituted. 23. In clause 6.8.2.8, the following proviso shall be inserted, namely:- Provided that in case of a fast track iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use ( b ) shall apply to a fast track issue. 29. In clause 6.9.6.2, after sub-clause ( c ), the following proviso shall be inserted, namely:- Provided that nothing contained in sub-clause ( c ) shall apply to a fast track issue. 30. In clause 6.10.3.1, after sub-clause ( k )( ii ), the following proviso shall be inserted, namely:- Provided that nothing contained in this clause shall apply to an issue made by any Government company, statutory authority or corporation or any special purpose vehicle set up by any of them. 31. In clause 6.10.3.2, after the words filing draft prospectus with the Board and before the colon, the words or in case of a fast track issue, one month before the reference date shall be inserted. 32. After clause 6.10.3.2, the following Explanation shall be inserted, namely:- Explanation - For the purposes of this clause, the term reference date shall have the same meaning as assigned to it in Explanation ( a ) to clause 2.1.2A.1. 33. In clause 6.11.1.3, after sub-clause ( f ), the following proviso shall be inserted, namely:- Provided that nothing contained in this clause shall apply to an issue made by an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection III - Contents of the letter of offer 40. In clause 6.39- ( i ) for the words section of this Chapter , the words section I of this Chapter shall be substituted. ( ii ) before the existing first proviso, the following proviso shall be inserted, namely :- Provided that nothing contained in clauses 6.8.2.2, 6.8.2.3, sub-clauses ( a ), ( b ), ( c ), ( d ) and ( e ) of clause 6.8.3.2, clauses 6.8.4.12, 6.9.2.1, 6.9.2.2, 6.9.2.3, 6.9.2.4, 6.9.4, 6.9.6, 6.10.3, 6.12.16, 6.12.17, 6.12.18, 6.12.20 and 6.12.21 shall apply to a rights issue falling under 2.1.2A.1. ( iii ) in the existing first proviso, for the words Provided that , the words Provided further that in a case not falling within the preceding proviso shall be substituted. ( iv ) in the existing second proviso, for the word aforesaid , the word second shall be substituted. Chapter VIA Issue of Indian Depository Receipts (IDR s) Part I - General Requirements 41. In clause 6A.3- ( i ) for sub-clause (4), the following shall be substituted, namely :- 4. In every issue of IDR- ( i ) At least 50 per cent of the IDRs issued shall be subscribed to by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the basis of allotment occurring at the end, the words and figures the date of allotment shall be substituted. Chapter VIII Other Issue Requirements 48. In clause 8.2.1( e )- ( i ) after the words draft offer document with the Board and before the full stop, the words and also at time of filing red herring prospectus and prospectus with ROC shall be inserted. ( ii ) the following proviso shall be inserted, namely :- Provided that in case of a public issue of securities by a listed company satisfying all the requirements specified in clause 2.1.2A, there shall be no partly paid up shares/other securities at the time of filing red herring prospectus and prospectus with ROC. 49. In clause 2A of Explanation to clause 8.3.4, for the words the shareholders who, on the record date (date fixed for the purpose of determining the eligible shareholders) , are holding shares worth up to ₹ 50,000 determined on the basis of closing price as on the previous day , the words retail individual shareholders shall be substituted. 50. In clause 8.5, after sub-clause ( g ), the following sub-clause shall be inserted, namely :- ( h ) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd 9.2 to draft offer document filed with SEBI shall be construed as having been made to red herring prospectus (in case of a book built issue) or prospectus (in case of a fixed price issue) filed with ROC or letter of offer filed with Designated Stock Exchange , unless the context otherwise requires. Chapter X Guidelines for Issue of DEBT Instruments 58. In clause 10.2.5, the following proviso shall be inserted, namely :- Provided that in case of a fast track issue of debt instruments, the certificate specified in this clause shall not be filed with SEBI. Chapter XI Guidelines on Book Building 59. In clause 11.3.1, for sub-clause ( xxa ), the following sub-clause shall be substituted, namely :- ( xxa ) The bidding terminals shall contain a online graphical display of demand and bid prices updated at periodic intervals, not exceeding 30 minutes. The book running lead manager shall ensure the availability of adequate infrastructure for data entry of the bids in a timely manner. 60. After clause 11.3.6 and the sub-clauses thereto, the following clauses shall be inserted, namely :- 11.4 Applicability to fast track issues 11.4.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith and appropriate disclosures as to compliance with the clause have been made in the draft prospectus/letter of offer. 7. We undertake that clauses 4.9.1, 4.9.2, 4.9.3 and 4.9.4 of the SEBI (Disclosure and Investor Protection) Guidelines, 2000 shall be complied with. We confirm that arrangements have been made to ensure that promoters contribution and subscription from all firm allottees would be received at least one day before the opening of the issue .We undertake that auditors certificate to this effect shall be duly submitted to the Board. We further confirm that arrangements have been made to ensure that promoters contribution shall be kept in an escrow account with a Scheduled Commercial Bank and shall be released to the company along with the proceeds of the public issue. 8. Where the requirements of promoters contribution is not applicable to the issuer, we certify the requirements of promoters contribution under clause 4.10 sub-clause ( a ), ( b ) or ( c ), as may be applicable are not applicable to the issuer. 9. We certify that the proposed activities of the issuer for which the funds are being raised in the present issue fall within the main objects l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the para ending with draft prospectus with SEBI till date and before the words Yours faithfully, the following paras shall be inserted, namely :- We confirm that agreements have been entered into with both the depositories for dematerialisation of the securities of the issuer. We certify that as per the requirements of 1st proviso to clause 4.9.1 of the SEBI (Disclosure and Investor Protection) Guidelines, 2000, cash flow statement has been prepared and disclosed in the red herring prospectus and/or prospectus. 71. After Schedule VI, the following Schedule shall be inserted, namely :- Schedule VI-A (Clause 5.3.3.1A) Additional Confirmations/Certification to be included in due Diligence Certificate for fast Track Issues 1. We confirm that none of the intermediaries named in the red herring prospectus (in case of a book built issue)/prospectus (in case of a fixed price issue)/letter of offer (in case of a rights issue) have been debarred from functioning by any regulatory authority. 2. We confirm that the issuer is eligible to make fast track issue in terms of clause 2.1.2A of the SEBI (Disclosure and Investor Protection) Guidelines, 2000. The fulfi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ries; ( c ) details of lock-in have been provided to all the stock exchanges on which securities are to be listed, before the listing of the securities. (2) We certify that shares offered as minimum promoters contribution, if any, have been locked-in for a period of three years as per clauses 4.11.1 and 4.11.2 of the SEBI (Disclosure and Investor Protection) Guidelines, 2000. (3) We certify that excess promoters contribution has been locked-in as per clauses 4.12.1 and 4.12.2 of the SEBI (Disclosure and Investor Protection) Guidelines, 2000. (4) We certify that clause 4.12.3 of the SEBI (Disclosure and Investor Protection) Guidelines, 2000 has been duly complied with. (5) We certify that provisions regarding lock-in of securities have been duly complied with in accordance with clause 4.14 of the SEBI (Disclosure and Investor Protection) Guidelines, 2000. Place : Lead Merchant Bankers to the Issue Date : With Official Seal(s) Schedule XX-A Formates of Issue Advertisements 74. In Parts B and C of Schedule XX-A, the words, Syndicate Members, Brokers , ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
