CLB qualification rules & 51 Public Financial Institution

"8^th October 2007 is today"

Credits to Dr. KS Ravichandran

The Gazette of India G.S.R. 588(E) - Company Law Board (Qualifications, Experience and other Conditions of Service of Members) Amendment Rules, 2007 .

8. Term of office of Chairman, Vice-Chairman and Members.—Except as provided in rule 6 or 7, the Chairman shall hold office till he attains the age of sixty-seven years (the then 65 yrs); the Vice-Chairman shall hold office till he attains the age of sixty-five years (the then 62 yrs)and any other member shall hold office till he attains the age of sixty-two years (the then 60 yrs).

The Gazette of India S.O. 1583(E) - Notification under powers conferred by sub-section (2) of Section 4A of the Companies Act, 1956 .

Now, Tamilnadu Urban Finance & Infrastructure Development Corporation Limited and Kerala Power Finance Corporation Limited is added to the list thereby increasing the count to 51 institutions.

Press Release: 2007-2008/473 - check here, http://www.rbi.org.in/scripts/BS_PressReleaseDisplay.aspx

Misuse of banknotes

It has been brought to the Bank's notice that members of public, institutions and others continue to write messages etc. on the watermark window and deface the portraits etc. on the banknotes. The Bank wishes to reiterate that such practices work against the Clean Note Policy of the Bank. All members of public, institutions and others are, therefore, advised not to write/inscribe anything whatsoever on the banknotes

--
Vj
Trezrrr every pulsss
http://yehseeyes.blogspot.com/

SEBI Timelines for 12 day listing of IPO/FPO/Public issue of securities w.e.f 3rd May 2010 - The Public offer schedule to commence trading

In consultation with market intermediaries, SEBI has issued a press release for Listing with Stock Exchanges to be made within 12 days of closure of public issue wef 1st May 2010.

In the new process, the syndicate members shall capture all data relevant for
purposes of finalizing basis of allotment while uploading bid data in the electronic bidding system of the stock exchanges. In order that the data so captured is accurate, syndicate members may be permitted an additional day to amend some of the data fields entered by them in the electronic bidding system.

It is to be noted that syndicate members shall be responsible for any error in the bid details uploaded by them. In case of apparent data entry error by either syndicate member or collecting bank in entering the application number in their respective schedules other things remaining unchanged, the application may be considered as valid and such exceptions may be recorded in minutes of the meeting submitted to stock exchange(s). In the event of mistake in capturing the application number by either the syndicate member or collecting bank leading to rejection of application, the registrar may identify based on the bid form, the entity responsible for the error. Valid records in electronic file will be those for which money is received.

This circular contains indicative timelines for the various activities in the issue process. The non-ASBA process in this regard is given in Annexure I of the circular. Since the ASBA process also needs to be revised pursuant to the
reduced timelines, the revised ASBA process is indicated in Annexure II of the circular.

Details of the mandatory data fields which are required to be captured into the electronic bidding system by the syndicate members including the fields which are modifiable/non-modifiable is given in Annexure III of the circular.

In order to facilitate quicker processing of applications for the purpose of allotment, instead of the name of the applicant, it is proposed to use PAN which is a unique identification number of the applicant. In this regard, the merchant bankers are directed to ensure that the following is clearly disclosed in the prospectus/abridged prospectus, application form and the pre-issue advertisements: “The applicants may note that in case the DP ID & Client ID and PAN mentioned in the application form and entered into the electronic bidding system of the stock exchanges by the syndicate members do not match with the DP ID & Client ID and PAN available in the depository database, the application is liable to be rejected.”

Stock Exchanges are directed to ensure that in case of revision of bids, there shall be appropriate provisions to capture the details of the payment instrument for difference of amount, if any.  It is given to understand that there is no uniformity in the documents required to be submitted to the stock exchanges along with the listing application which results in delay in the process. In this regard, stock exchanges are directed to clearly indicate the list of documents which they require for giving listing approval, at the time of grant of in-principle approval.

Stock Exchanges, Merchant Bankers, Registrar to an Issue, Bankers to an issue including those acting as Self Certified Syndicate Banks and depositories are directed to ensure that the instructions contained in this circular are complied with. This revised procedure shall be applicable to all public issues opening on or after May 3, 2010.

Download the IPO Timeline or Public Issue Schedule issued by SEBI from T+0 till T + 12 days, where “T” is the issue closing date and “T+12” is the date of commencement of trading vide SEBI CIR/CFD/DIL/3/2010 dated 22nd April 2010.

New Rule 19(2)(b) & 19A for initial & continuous listing requirement of 25% of capital with public as per SCRR amendment 2010 [for all companies]: 10% for 4000 crores to be increased@5% every year

The Securities Contracts (Regulation) Rules 1957 provide for the requirements which have to be satisfied by companies for the purpose of getting their securities listed on any stock exchange in India. A dispersed shareholding structure is essential for the sustenance of a continuous market for listed securities to provide liquidity to the investors and to discover fair prices. Further, the larger the number of shareholders, the less is the scope for price manipulation. Accordingly, the Finance Minister in his Budget speech for 2009-10, inter- alia, proposed to raise the threshold for non- promoter, public shareholding for all listed companies. To implement the Budget announcement the Securities Contracts(Regulation) (Amendment) Rules, 2010 has been notified vide Press Release F.No.5/35/2006-CM dated 4th June 2010 through

this Notification. [download now]

a) The minimum threshold level of public holding will be 25% for all listed companies.

b) Existing listed companies having less than 25% public holding have to reach the minimum 25% level by an annual addition of not less than 5% to public holding.

c) For new listing, if the post issue capital of the company calculated at offer price is more than Rs. 4000 crore, the company may be allowed to go public with 10% public shareholding and comply with the 25% public shareholding requirement by increasing its public shareholding by at least 5% per annum.

d) For companies whose draft offer document is pending with Securities and Exchange Board of India on or before these amendments are required to comply with 25% public shareholding requirement by increasing its public shareholding by at least 5% per annum, irrespective of the amount of post issue capital of the company calculated at offer price.

e) A company may increase its public shareholding by less than 5% in a year if such increase brings its public shareholding to the level of 25% in that year.

f) The requirement for continuous listing will be the same as the conditions for initial listing.

g) Every listed company shall maintain public shareholding of at least 25%. If the public shareholding in a listed company falls below 25% at any time, such company shall bring the public shareholding to 25% within a maximum period of 12 months from the date of such fall.

New definitions in Rule 2 of SCRR:

(d) “public” means persons other than – (i) the promoter and promoter group; (ii) subsidiaries and associates of the company. Explanation: For the purpose of this clause the words “promoter‟ and “promoter group‟ shall have the same meaning as assigned to them under the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements-ICDR) Regulations, 2009.

(e) “public shareholding” means equity shares of the company held by public and shall exclude shares which are held by custodian against depository receipts issued overseas”.

New Rule 19(2)(b) of SCRR:

(i) At least 25% of each class or kind of equity shares or debentures convertible into equity shares issued by the company was offered and allotted to public in terms of an offer document; or
(ii) At least 10% of each class or kind of equity shares or debentures convertible into equity shares issued by the company was offered and allotted to public in terms of an offer document if the post issue capital of the company calculated at offer price is more than Rs. 4000 crores;

Provided that the requirement of post issue capital being more than Rs. 4000 crores shall not apply to a company whose draft offer document is pending with SEBI on or before the commencement of the Securities Contracts (Regulation) (Amendment) Rules, 2010, if it satisfies the conditions prescribed in clause (b) of sub-rule 2 of rule 19 of the Securities Contracts (Regulation) Rules, 1956 as existed prior to the date of such commencement (which is: offering atleast 10% if there are 20 lakh in number of securities, Rs.100 crores of offer size is given to public and follows bookbuilding by offering 60% to QIB)
Provided further that the company, referred in sub-clause (ii), shall bring the public shareholding to the level of at least 25% by increasing its public shareholding to the extent of at least 5% per annum beginning from the date of listing of the securities, in the manner specified by the Securities and Exchange Board of India .
Provided further that the company may increase its public shareholding by less than 5% in a year if such increase brings its public shareholding to the level of 25% in that year.

 

New Rule 19(4) of SCRR – fresh application in all cases now!!!

An application for listing shall be necessary in respect of the following: (a) all new issues of any class or kind of securities of a company to be offered to the public; (b) all further issues of any class or kind of securities of a company if such class or kind of securities of the company are already listed on a recognised stock exchange.

 

New Rule 19(6A) – taking away the power from Clause 40A of Listing Agreement of stock exchanges as there is no more Provisio!!!

All the requirements with respect to listing or continuous listing requirement prescribed by these rules, shall, so far as they may be, also apply to a body corporate constituted by an Act of Parliament or any State Legislature. [Old Provisio deleted]

Note: SEBI’s power to relax listing requirements under SCRR is withdrawn.  Also note, there is no more Clause 40A continuous listing requirement of 10% if the company has 2 crores of listed shares with a market capitalisation of Rs.1000 crore or more.

Clause 40A is now Rule 19A mandating 25% as CONTINUOUS LISTING REQUIREMENT for all Companies:

Every listed company shall maintain public shareholding of at least 25%

Provided that any listed company which has public shareholding below 25% on the commencement of the Securities Contracts (Regulation) (Amendment) Rules, 2010, shall bring the public shareholding to the level of at least 25% by increasing its public shareholding to the extent of at least 5% per annum beginning from the date of such commencement, in the manner specified by SEBI.

Provided further that the company may increase its public sharholding by less than 5% in a year if such increase brings its public shareholding to the level of 25% in that year.

(2) Where the public shareholding in a listed company falls below 25% at any time, such company shall bring the public shareholding to 25%within a maximum period of 12 months from the date of such fall in the manner specified by the Securities and Exchange Board of India.”

Public Comment on Norms for Branch/Liaison Offices in India by Foreign Entities

Dear All,

Public Comment on Norms for
Branch/Liaison Offices in India by Foreign Entities

As per existing provisions of Foreign Exchange Management (Establishment in India of branch or office or other place of business) Regulations, 2000 both opening and closure of Branch/Liaison/Project Offices in India can be done only after getting prior approval from RBI (Central / Regional Office as applicable). This note covers procedural formalities involved in opening of Branch/Liaison/Project Offices in India.

Vide Press Release dated 6^th May 2008, the Reserve Bank of India has proposed to delegate certain powers to authorised dealers regarding extension of validity period of liaison offices of foreign entities and closure of their branch/liaison offices in India. It has proposed to make the delegated powers effective from July 1, 2008 in order to provide necessary time to authorised dealers to assimilate the revised dispensation. So, once it is implemented, if foreign Companies wanted close its Branch/Liaison/Project Offices in India, it can do so once obtaining approval from concern AD instead of Regional Office of RBI. I believe it will reduce considerable time involved in closure liaison/branch office from current time limit of about 2 months in general to complete all the formalities.

Relaxation in Eligibility Criteria

Further, under the present provisions of Foreign Exchange Management Act, a person resident outside India requires prior approval of the Reserve Bank of India for establishing branch/liaison offices in India. The applications are considered by the Reserve Bank on case by case basis subject to the company meeting the eligibility criteria, such as, track record, financial position, etc. with a view to achieving greater transparency, the Reserve Bank of India has also proposed to place in public domain eligibility criteria and procedural guidelines for establishment of branch and liaison offices by foreign entities in India.

For the purpose of seeking public comments, the Reserve Bank has placed on its website, both - the draft circulars regarding delegation of powers for extension of validity period or closure of liaison offices of foreign entities in India and eligibility criteria and procedural guidelines for branch/liaison offices of foreign entities in India. Comments on these can be sent to The Chief General Manager, Foreign Exchange Department, Reserve Bank of India, Central Office (FID), Central Office Building, 11th Floor, S.B.S.Marg, Fort, Mumbai-400001 or by FAX (Fax No. 022-2261 0623) or by e-mail latest by May 20, 2008.

Thanks & Regards

Alagar
Investment Banking
Karvy Investor Services Limited
Chennai
Tel: 044-28151034/3445/3658
Moble: 919884731993/ 919790906827
e-mail: alagar.muthu@karvy.com

SEBI guidelines on Market Access through Authorised Persons under Stock Brokers regulation as amended on 2010

To expand the reach of the markets for exchange traded products, it has been decided to allow SEBI registered stock brokers (including trading members) of stock exchanges to provide access to clients through authorised
persons.

Regulatory Framework for Market Access through Authorised Persons (MIRSD/ DR-1/ Cir- 16 /09 dated 6th November 2009)
1. Who is an “Authorised Person”?
Any person - individual, partnership firm, LLP or body corporate – who is
appointed as such by a stock broker (including trading member) and who
provides access to trading platform of a stock exchange as an agent of the
stock broker.
2. Appointment of Authorised Person
A stock broker may appoint one or more authorised person(s) after obtaining
specific prior approval from the stock exchange concerned for each such person. The approval as well as the appointment shall be for specific segment of the exchange.
3. Procedure for Appointment
a) Stock broker shall select a person in compliance with the criteria laid down
by the Exchange and this framework for appointment as an authorized
person and forward the application of the person to stock exchange for
approval.
b) On receipt of the aforesaid application, the stock exchange
i. may accord approval on satisfying itself that the person is eligible for
appointment as authorized person, or
ii. may refuse approval on satisfying itself that the person is not eligible for
appointment as authorized person.
4. Eligibility Criteria
4.1 An individual is eligible to be appointed as authorised person if he:
a) is a citizen of India;
b) is not less than 18 years of age;
c) has not been convicted of any offence involving fraud or dishonesty;
d) has good reputation and character;
e) has passed at least 10th standard or equivalent examination from an
institution recognized by the Government; and
f) has the certification, as applicable to approved user / sales personnel of
the respective segment, and undertakes to continue to have valid
certification thereafter. [vide SEBI/Cir/MIRSD/AP/8/2010 dated 23rd July 2010]
(Stock Exchange shall prescribe appropriate certification if no such
certification is prescribed under SEBI Regulations and monitor
compliance.)
4.2 A partnership firm, LLP or a body corporate is eligible to be appointed as
authorized person
a) if all the partners or directors, as the case may be, comply with the
requirements contained in clause 4.1 above.
b) the object clause of the partnership deed or of the Memorandum of
Association contains a clause permitting the person to deal in securities
business.
4.3 The person shall have the necessary infrastructure like adequate office
space, equipment and manpower to effectively discharge the activities on
behalf of the stock broker.

4.4 The approved users and/or sales personnel of Authorised Persons shall have the necessary certification of the respective segments at all points of time. [vide SEBI/Cir/MIRSD/AP/8/2010 dated 23rd July 2010]
5. Conditions of Appointment
The following are the conditions of appointment of an authorised person:
a) The stock broker shall be responsible for all acts of omission and
commission of the authorized person.
b) All acts of omission and commission of the authorized person shall be
deemed to be those of the stock broker.
c) The authorized person shall not receive or pay any money or securities
in its own name or account. All receipts and payments of securities and
funds shall be in the name or account of stock broker.
d) The authorised person shall receive his remuneration - fees, charges,
commission, salary, etc. - for his services only from the stock broker and
he shall not charge any amount from the clients.
e) A person shall not be appointed as authorized person by more than one
stock broker on the same stock exchange.
f) A partner or director of an authorised person shall not be appointed as
an authorised person on the same stock exchange.
g) The stock broker and authorised person shall enter into written
agreement(s) in the form(s) specified by Exchange. The agreement shall
inter-alia cover scope of the activities, responsibilities, confidentiality of
information, commission sharing, termination clause, etc.
6. Withdrawal of Approval
Approval given to an authorised person may be withdrawn by the stock
exchange:
a) on receipt of a request to that effect from the stock broker concerned or
the authorised person, subject to compliance with the requirements
prescribed by the stock exchange, or
b) on being satisfied that the continuation of authorised person is
detrimental to the interest of investors or securities market or the
authorised person at a subsequent date becomes ineligible under clause
4 above.
7. Obligations of Stock Broker
a) The stock broker shall be responsible for all acts of omission and
commission of his authorised person(s) and/or their employees,
including liabilities arising there from.
b) If any trading terminal is provided by the stock broker to an authorised
person, the place where such trading terminal is located shall be treated
as branch office of the stock broker.
c) Stock broker shall display at each branch office additional information
such as particulars of authorised person in charge of that branch, time
lines for dealing through authorised person, etc., as may be specified by
the stock exchange.
d) Stock broker shall notify changes, if any, in the authorised person to all
registered clients of that branch at least thirty days before the change.
e) Stock broker shall conduct periodic inspection of branches assigned to
authorised persons and records of the operations carried out by them.
f) The client shall be registered with stock broker only. The funds and
securities of the clients shall be settled directly between stock broker and
client and all documents like contract note, statement of funds and
securities would be issued to client by stock broker. Authorised person
may provide administrative assistance in procurement of documents and
settlement, but shall not issue any document to client in its own name.
No fund/securities of clients shall go to account of authorized person.
g) On noticing irregularities, if any, in the operations of authorised person,
stock broker shall seek withdrawal of approval, withhold all moneys due
to authorised person till resolution of investor problems, alert investors in
the location where authorised person operates, file a complaint with the
police, and take all measures required to protect the interest of investors
and market.
8. Obligations of Exchange
a) The stock exchange shall maintain a database of all the authorised
persons which shall include the following:
I. PAN Number of authorised person and in case of partnership or body
corporate, PAN Number of all the partners or directors as the case
may be.
II. Details of the broker with whom the authorised person is registered.
III. Locations of branch assigned to authorised person(s).
IV. Number of terminals and their details, given to each authorised person.
V. Withdrawal of approval of authorised person.
VI. Change in status or constitution of authorised person.
VII. Disciplinary action taken by the Exchange against the authorised
person.
All the above details, except I above, shall be made available on web site of
the stock exchange.
b) While conducting the inspection of the stock broker, the stock exchange
shall also conduct inspection of branches where the terminals of
authorised persons are located and records of the operations carried out
by them.
c) Dispute between a client and an authorised person shall be treated as
dispute between the client and the stock broker and the same shall be
redressed by the stock exchange accordingly.
d) In case of withdrawal of approval of authorised person due to
disciplinary action, the stock exchange shall issue a press release and
disseminate the names of such authorised persons on its website citing
the reason for cancellation.