SEBI Financial Year 2024

Important updates in the Securities Law during FY 2023-24

Amendments in the Securities Law during the financial year 2023-2024

1. Introduction of Legal Entity Identifier (LEI) for listed non-convertible securities, securitized debt instruments, and security receipts

The issuer that is proposing to issue and list non-convertible securities or securitized debt instruments and security receipts on or after September 01, 2023, shall report their LEI code in the Centralized Database of Corporate Bonds and Depositories respectively at the time of allotment of the ISIN.

Entities in India can obtain LEI from Legal Entity Identifier India Ltd (LEIIL), a subsidiary of the Clearing Corporation of India Limited (CCIL). The Depositories shall map the LEI code provided by the issuers with the ISIN at the time of activation of the ISIN.

2. Investment in units of Mutual Funds in the name of the minor through the guardian

Revision has been made in the mode of payment for investment in units of Mutual Funds by the minor through a guardian. Under the revised terms, payment for investment by any mode can be made to the Asset Management Companies (AMCs) using the bank account of the minor, parent, or legal guardian, or a joint account of the minor with parent/legal guardian.

Further, for existing folios, AMCs are required to insist upon a Change of Pay-out Bank mandate before redemption is processed. Irrespective of the source of subscription payment, all redemption proceeds shall be credited only to the verified bank account of the minor, i.e. the account the minor may hold with the parent/ legal guardian after completing all KYC formalities.

3. Dematerialisation of securities of Hold Cos and SPVs held by Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InVITS)

SEBI directed REITs and InVITs to hold the securities of HoldCos and SPVs in dematerialized form only and the Manager of the REIT/ InVIT to ensure the same.

4. Online Processing of investor service requests and complaints by RTA (Registrar to an Issue & Share Transfer Agent)

SEBI introduced online processing of investor service requests and complaints by Registrars to Issue & Share Transfer Agents (RTAs). A proposal for a two-phase approach to digitize the processing of investor service requests has been issued. In Phase I, RTAs for listed companies must establish a user-friendly website and online portal. This portal allows investors to submit and track requests/complaints with features like acknowledgment, clear procedures, and category selection. Each request gets a unique reference number for monitoring. Phase II entails a common website operated by Qualified Registrars to an Issue (QRTAs), directing investors to the relevant RTA portal by entering the company’s name. This streamlines resolution and improves efficiency in addressing investor issues.

5. Filing of Annual Secretarial Compliance Report (ASCR) in XBRL format on the BSE Listing Centre and NSE Electronic Application Processing System (NEAPS) platform.

The listed entities are to file ASCR under Regulation 24A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 in XBRL Mode.

6. SEBI (Listing Obligations and Disclosure Requirements) (Second Amendment) Regulations, 2023

Key Amendments Include: –

The top 100 listed entities from February 01, 2024, onwards and the top 250 listed entities from August 01, 2024, onwards are required to either confirm, deny, or clarify any reported event/ information circulating in the “Mainstream Media” regarding impending specific material events/ information within 24 hours.
Introduction of Quantitative Criteria for Determining Materiality.
Changes to the list of Events/ Information that are deemed Material.
Disclosure of Communication received from Authorities.
Shareholders’ Approval for continuation of Directors of Listed Entities.
Shareholders’ Approval for “Special Rights”
Shareholders’ Approval for the Sale, Lease, or Disposal of Undertaking(s).

7. Master Circular on Scheme of Arrangement by Listed Entities

The Master Circular issued by SEBI provided access to all the applicable circulars in one place relating to the Scheme of Arrangements by Listed Entities. The Master Circular has clarified that the ‘relevant date’ for the purpose of computing pricing shall be the date of the Board Meeting in which the Scheme of Arrangement is approved. The provisions of the Master Circular shall not apply to schemes that solely provide for the merger of a wholly owned subsidiary of its division with the parent company.

The Master Circular has prescribed the provisions relating to the following subject:

Requirements before the Scheme of arrangement is submitted for sanction by the National Company Law Tribunal (NCLT).
Application for relaxation under Sub-rule (7) of rule 19 of the Securities Contracts (Regulation) Rules, 1957.
Format of the Compliance Report to be submitted along with the draft scheme.
Computation of Fair Share Exchange Ratio.
Format for Auditor’s Certificate for the proposed Accounting Treatment.
Format for a report on complaints received on the Draft Scheme from various sources (complaints/comments written directly to the listed entity or forwarded to it by the Stock Exchanges/SEBI) prior to obtaining an Observation Letter from Stock Exchanges on the Draft Scheme.
Format for a report on unpaid dues of SEBI, Stock Exchanges, and the Depositories prior to obtaining an Observation Letter from Stock Exchanges on the Draft Scheme.
Format of the Compliance Report to be submitted along with the application for relaxation under Sub-rule (7) of rule 19 of the Securities Contracts (Regulation) Rules, 1957) if listing of Non-Convertible Redeemable Preference Shares (NCRPS) / Non-Convertible Debentures (NCDs) is envisaged through a Scheme of Arrangement.

8. Issuance of units of Alternative Investment Funds (“AIFs”) in dematerialized form

AIFs, pursuant to the 2nd Amendment dated June 15, 2023, to SEBI (AIFs) Regulations, 2012 to dematerialize their units within the following timelines:

Particulars	Schemes of AIFs with corpus ≥ Rs 500 Crore	Schemes of AIFs with corpus < Rs 500 Crore
Dematerialization of all the units issued	Latest by October 31, 2023	Latest by April 30, 2024
Issuance of units only in dematerialized form	November 01, 2024 onwards	May 01, 2024 onwards

The manager of AIF shall submit a report on compliance with the dematerialization requirements on www.siportal.sebi.gov.in.

The trustee/sponsor of AIF to ensure that the ‘Compliance Test Report’ prepared by the manager includes compliance with the dematerialization requirements.

9. Standardised approach to valuation of investment portfolio of Alternative Investment Funds

The securities whose valuation norms have already been prescribed under SEBI (Mutual Funds) Regulations, 1996 to be valued as per the norms prescribed therein. Valuation of securities that are not covered under SEBI (Mutual Funds) Regulations, 1996 to be carried out as per valuation guidelines endorsed by any AIF Industry Association. It shall be the responsibility of the Manager to ensure that the investment of schemes is valued in the manner prescribed by SEBI.

10. Format for Annual Secretarial Compliance Report for InvITs and REITs

SEBI has issued the format of an Annual Secretarial Compliance Report for InvITs and REITs, to be issued by a Practising Company Secretary (PCS) appointed by the Manager or Investment Manager of the entity, as applicable, to examine the compliance of all applicable SEBI Regulations and circulars/guidelines issued thereunder. The Annual Secretarial Compliance Report must be submitted to the stock exchanges within 60 days from the end of each financial year and to be included in the entity’s Annual Report.

11. Format of Compliance Report on Governance for REITs and InVITs

SEBI has issued a format of Compliance Report on Corporate Governance for InvITs and REITs. The Manager or Investment Manager of the entity, as applicable, is to submit a quarterly Compliance Report signed by the Compliance Officer or CEO of the Manager or the Investment Manager, as applicable, to the stock exchanges within 21 days from the end on the quarter.

12. Manner of achieving minimum public unitholding – REITs and InVITs

SEBI has notified methods for listed REITs and InvITs which have public unitholding below 25%, to achieve compliance with the 25% minimum public unitholding requirement. The listed REITs or InvITs are mandated to achieve minimum public unitholding of at least 25% within 3 years from the date of listing of the units pursuant to the initial offer.

13. SEBI (Issue and Listing of Non- Convertible Securities) 2nd Amendment Regulation

Key Amendments inter-alia include:

New definitions of Key Managerial Personnel and Senior Management.
Parity in disclosures introduced for Public Issue and Private Placement of non-convertible debt securities.
General Information Document and Key Information Document introduced for Private Placements.
Shelf Placement Memorandum to be phased out.

14. Appointment of Director nominated by the Debenture Trustee on boards of issuers

In accordance with the requirements for the issue and listing of non-convertible securities, entities registered under the Companies Act, 2013 to ensure that its Articles of Association require its Board of Directors to appoint as director, the person nominated by the debenture trustee(s) viz. a Nominee Director.

Issuers that are not companies under the Companies Act, 2013 have the option, in case of certain events of defaults, to designate a non-executive/independent director/trustee/member of its governing body as a Nominee Director in consultation with the debenture trustee(s). However, issuers that are not companies under the Companies Act, 2013 to submit an undertaking on this behalf to their debenture trustee(s).

15. Amendments to guidelines for the preferential issue and institutional placement of units by a listed REIT or InVIT

SEBI modified the Pricing method for preferential issues and institutional placement of units by listed REITs and InVITs. Institutional placement should be made by a listed REIT or InVIT at a price not lower than the average of the weekly high and low closing prices of units of the same class quoted on the stock exchange during the 2 weeks preceding the relevant date. However, the REIT or InVIT may offer a discount of up to 5% on the calculated price, subject to approval from unitholders through a resolution. The relevant date shall be the date of the meeting in which the board of directors of the manager decides to open the issue.

16. Business Responsibility and Sustainability Report (BRSR) Core – Framework for assurance and ESG disclosures for value chain

Top 1000 listed entities (by market capitalization) shall make disclosures as per the updated BRSR format, as part of their Annual Reports from the FY 2023 – 2024. The Listed entities shall mandatorily undertake reasonable assurance of the BRSR Core as per the following timelines:

Financial Year	Applicability of BRSR Core to top listed entities (market capitalization)
2023-24	Top 150 listed Entities
2024-25	Top 250 listed Entities
2025-26	Top 500 listed Entities
2026-27	Top 1000 listed Entities

Disclosures for Value Chain shall be made by the listed company as per BRSR Core, as part of its Annual Report. Value Chain consists of the top upstream and downstream partners of a listed entity, cumulatively comprising 75% of its purchases/sales (by value).

Listed entities shall report the KPIs in the BRSR Core for their value chain to the extent it is attributable to their business with that value chain partner, as part of its Annual Report. Such reporting may be segregated for upstream and downstream partners or can be reported on an aggregate basis and will apply to the top 250 listed entities (by market capitalization), on a comply-or-explain basis from FY 2024-25 and limited assurance shall be applicable from FY 2025-26.

17. Disclosure of material events/information by listed entities under Regulations 30 and 30A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI LODR”).

SEBI has specified the following with regard to disclosure requirements of material events/information under Regulations 30 and 30A of SEBI LODR:

Details that a listed entity needs to disclose for the events that are deemed to be material as specified in Para A of Part A of Schedule III of the SEBI LODR.
Details which a listed entity needs to disclose for events on which the listed entity shall apply materiality in terms of Para B of Part A of Schedule III of the SEBI LODR.
Timeline for disclosing events given in Part A of Schedule III of SEBI LODR.
Guidance on when an event/information can be said to have occurred for disclosures under Regulation 30 of the SEBI LODR.
Guidance on the criteria for determination of materiality of events/information

18. Glide path for implementation of framework for restricting trading by Designated Persons (“DPs”) by freezing PAN at security level to all listed companies in a phased manner

Timelines for phase-wise implementation of the framework for restricting trading by DPs by freezing PAN at the security level: –

Companies to be covered	PAN freeze start date
Listed companies that are part of benchmark indices i.e., NIFTY 50 and SENSEX	Already applicable
Top 1,000 companies in terms of BSE Market Capitalization as of June 30, 2023 (excluding companies part of benchmark indices)	October 1, 2023
Next 1,000 companies in terms of BSE Market Capitalization as of June 30, 2023	January 1, 2024
Remaining companies listed on BSE, NSE & MSEI	April 1, 2024
Companies getting listed on Stock Exchanges post issuance of circular dated July 19, 2023	1^st day of the second quarter from the quarter in which the company gets listed

19. New category of Mutual Fund schemes for Environmental, Social, and Governance (“ESG”) Investing and related disclosures by Mutual Funds

SEBI in view of the increasing need for green financing, has permitted the launch of multiple ESG schemes with different strategies by Mutual Funds.

The schemes under ESG to be launched with any one of the strategies:

Exclusion
Integration
Best-in-class & Positive Screening
Impact investing
Sustainable objectives
Transition or transition-related investments.

The Mutual Funds are to invest a minimum of 80% of the Total Assets under Management (AUM) of the ESG scheme in equity & equity-related instruments of the above-mentioned strategy of the scheme.

The remaining portion of investment shall not contrast to the strategy of the scheme. AMCs to ensure that the schemes launched by Mutual Funds are clearly distinct in terms of asset allocation, investment strategy, etc.

The ESG scheme is to invest at least 65% of its AUM in companies that are reporting on comprehensive BRSR and are also assuring BRSR Core disclosures.

With effect from October 01, 2024, the ESG schemes to invest a minimum of 65% of AUM in companies that are reporting on comprehensive BRSR and are also assuring BRSR Core disclosures and balance investment in companies having BRSR disclosures.

ESG schemes that are not in compliance with investment criteria as of October 01, 2024, to ensure compliance with the requirement by September 30, 2025. During this period of one year, ESG schemes do not undertake any fresh investments in companies without assurance on BRSR Core.

20. Mandating Legal Entity Identifier (LEI) for all non – individual Foreign Portfolio Investors (FPIs)

Non-individual Foreign Portfolio Investors (FPIs) unlike earlier, mandatorily provide their Legal Entity Identifier (LEI) details in the Common Application Form (“CAF”) to, be used for registration, KYC, and account opening of FPIs.

All existing FPIs (including those applying for renewal) that have not already provided their LEIs to their DDPs were required to provide the same up to January 23, 2024, failing which their account was to be blocked for further purchases until LEI is provided to their DDPs.

FPIs to ensure that their LEI is active at all times. Accounts of FPIs whose LEI code has expired/lapsed are to be blocked for further purchases in the securities market till the time the LEI code is renewed by such FPIs.

21. Online Resolution of Disputes in the Indian Securities Market

SEBI has introduced an Online Dispute Resolution Portal (ODR Portal), a platform for the resolution of disputes arising in the Indian Securities Market with Market participants including Mutual Funds. The ODR portal provides investors with a platform to file complaints if they are dissatisfied with the resolution offered directly by the Asset Management Company or through SEBI’s SCORES platform. Disputes can be raised through the ODR portal within the applicable limitation period provided they are not already being addressed under SCORES guidelines or pending before a court.

ODR Portal named SMART ODR Portal – ‘Securities Market Approach for Resolution Through ODR’ is being made available for investors at https://smartodr.in/login.

22. Amendment in validity period granted to AIF/CIF for overseas investment

SEBI has reduced the validity period of approval given to AIFs and Venture Capital Funds (VCFs) for making overseas investments to 4 months (earlier 6 months). If these funds fail to make investments within the revised time limit, then SEBI can allocate their unutilized limits to other applicant AIFs and VCFs. The time limit has been reduced with an intent to utilize the allocated funds efficiently and, if unutilized, the same is again available to the AIF industry in a shorter period.

23.Transactions in Corporate Bonds through Request for Quote (RFQ) platform by FPIs

To increase liquidity on the RFQ platform vis-à-vis trading in Corporate Bonds by FPIs, FPIs are to undertake at least 10% of their total secondary market trades in Corporate Bonds by value by placing/seeking quotes on the RFQ platform of stock exchanges, every quarter.

24. Reduction of timeline for listing of shares in Public Issue from existing T+6 days to T+3 days

SEBI has reduced the time taken for listing specified securities after the closure of public issues from the existing 6 working days (T+6) to 3 working days (T+3) from the issue closing date (T). Further, the T+3 timeline for listing shall be appropriately disclosed in the Offer Documents of public issues.

25. SEBI (Listing Obligations and Disclosure Requirements) (Third Amendment) Regulations, 2023

SEBI has introduced a framework for voluntary delisting of non-convertible debt securities and non-convertible redeemable preference shares and obligations of the listed entity on such delisting.

26. Modification in Cyber Security and Cyber Resilience framework of Stock Exchanges, Clearing Corporations and Depositories

The Market Infrastructure Institutions(MIIs) are mandated to conduct comprehensive Cyber Audit at least 2 times in an FY along with the Cyber Audit Reports.
MIIs are directed to submit a declaration from the MD/CEO certifying that:

Comprehensive measures and processes including suitable incentive/disincentive structures, have been put in place for identification/detection and closure of vulnerabilities in the organization’s IT systems.
Adequate resources have been hired for staffing their Security Operations Centre (SOC).
There is compliance by the MII with all SEBI circulars and advisories related to cyber security.

27. New format of Abridged Prospectus for public issues of Non-Convertible Debt Securities and/or Non-Convertible Redeemable Preference Shares

SEBI revised the format for disclosures in the abridged prospectus for public issues of non-convertible debt securities and/or non-convertible redeemable preference Shares.

For public issues that open on or after October 1, 2023, the format of an Abridged Prospectus shall be as per Annex-I of the Circular (dated September 04, 2023) instead of Part B of Schedule I of the SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021 Regulations.

Further, it is prescribed that the issuer/ Merchant Bankers shall insert a Quick Response (QR) Code on the last on the last page of the Abridged Prospectus. The scan of such a QR Code on the Abridged prospectus would lead to the Prospectus.

28. Change in Mode of Payment w.r.t. SEBI Investor Protection and Education Fund Bank A/c

Remittances to the SEBI IPEF shall be made only through the link specified at the SEBI website (www.sebi.gov.in) under the head “Click here to pay SEBI IPEF”. The link enables the remitter to make payment in any of the following manners:

Net banking
NEFT/RTGS
Debit Cards
UPI

While making the remittances online, through the above link, remitters shall furnish the requisite information like the name of the payer, PAN, mobile number, email ID, the purpose for which payment is made, the amount to be paid, etc.

29. Mechanism for Sharing of Information by Credit Rating Agencies (CRAs) to Debenture Trustees (DTs)

CRAs shall use the Excel template as placed as an Annexure to the Circular (dated September 04, 2023) for their daily submissions of rating revisions to Debenture Trustees (DTs) as required under SEBI (Credit Rating Agencies) Regulations, 1999 (“CRA Regulations”) and circulars issued thereunder.

Such submissions are to be sent by CRAs to DTs on the same day as the day of rating revisions, on either the generic email ID used for regulatory purposes or email IDs/URLs as may be communicated for this purpose by DTs.

30. Regulatory Reporting by Alternative Investment Funds (AIFs)

SEBI has revised reporting formats by AIFs. The revised reporting format is to be hosted by the AIF associations on their website and to assist AIFs in understanding the reporting requirements and in clarifying/ resolving and addressing any reporting-related issues.

AIFs to submit quarterly reports online through the SEBI Intermediary Portal (SI Portal) within 15 calendar days from the end of each quarter as per the revised format. The association or an AIF Standard Setting Forum will periodically review the reporting format in consultation with SEBI.

Any revisions to the format will be published on association websites at least 1 month before the end of the quarter.

31. SEBI (Listing Obligations and Disclosure Requirements) (Fourth Amendment) Regulations, 2023 (SEBI (LODR) (Fourth Amendment) Regulations, 2023)

A new Regulation 62A is inserted which provides for the listing of subsequent issuances of non-convertible debt securities (NCDs) by listed entities whose NCDs are listed below:

(a) A listed entity whose NCDs are listed shall mandatorily list all NCDs proposed to be issued on or after January 01, 2024, on the stock exchange(s).

(b) A listed entity whose subsequent issues of Unlisted NCDs made on or before December 31, 2023, and outstanding as of December 31, 2023, may list the said Unlisted NCDs on the stock exchange(s);

(c) A listed entity that proposes to list any of its NCDs on the stock exchange(s) on or after January 1, 2024, shall list all outstanding Unlisted NCDs previously issued on or after January 1, 2024, on the stock exchange(s) within 3 months from the date of the listing of the NCDs proposed to be listed.

No listed entity shall be required to list the following securities:

Bonds issued under section 54EC of the Income Tax Act, 1961;
NCDs issued under an agreement entered into between the listed entity of such securities and multilateral institutions;
NCDs issued under an order of any court or Tribunal or regulatory requirement as stipulated by a financial sector regulator namely, the Board, Reserve Bank of India, Insurance Regulatory and Development Authority of India, or the Pension Fund and Regulatory Development Authority.

32. Redressal of investor grievances through the SEBI Complaint Redressal (SCORES) Platform and linking it to the Online Dispute Resolution platform

Entities that receive complaints from investors on SCORES, resolve the complaint and submit an Action Taken Report (ATR) on SCORES within 21 calendar days of receipt of such complaint from April 01, 2024. The Complaint shall also be simultaneously forwarded to the concerned Designated Bodies who are responsible for ensuring of submission of ATR by the entities.

33. Format of Cyber Security Incidence Disclosure under Corporate Governance Report

The listed entities are required to mandatorily disclose cybersecurity incidents, breaches, data, or document loss within the Corporate Governance Report every quarter in XBRL format as per Forma issued by SEBI.

34. Centralized mechanism for reporting the demise of an investor through KRAs

SEBI has introduced a centralized mechanism for reporting and verification in case of the demise of an investor thereby smoothening the process of transmission in the securities market.

SEBI has also spelled out the operational norms including the obligations of regulated entities, including registered intermediaries that have an interface with ‘investors’ / ‘account holders’ who are natural persons.

35. Limited relaxation from compliance with certain provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

SEBI has relaxed the requirement of the listed entity to send a hard copy of the statement containing the salient features of all the documents, as specified in Section 136 of the Companies Act, 2013 and rules made thereunder to those holders of non-convertible securities who have not registered their email address(es) either with the listed entity or with any depository up to September 30, 2024.

36. Relaxation from compliance with certain provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

SEBI has relaxed the requirement of sending proxy forms to holders of securities in all cases mentioning that a holder may vote either for or against each resolution for general meetings (in electronic mode) held till September 30, 2024.

37. Mandatory Filing of Voting Results in XBRL Mode.

SEBI to ensure compliance with standardized reporting measures and facilitate transparent and efficient dissemination of voting outcomes has discontinued the PDF reporting format of the Voting Results submission.

The listed entities are required to report Voting Results under Regulation 44(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 in XBRL format only.

38. Procedural framework for dealing with unclaimed amounts lying with entities having listed non-convertible securities and manner of claiming such amounts by investors

SEBI has standardized the process to be followed by a listed entity that has listed its non-convertible securities for the transfer of unclaimed interest/dividend/redemption amount to an Escrow Account and by the investors for making claims thereof, to define the manner of handling the unclaimed amounts lying in the Escrow Accounts of the listed entities which are not companies, transfer of such amounts to the Investor Protection and Education Fund created by SEBI in terms of section 11 of the SEBI Act, 1992 and claim thereof by the investors.

The framework for the above has been provided in the SEBI circular dated November 08, 2023, as Annexures A & B to the Circular:

Annex-A – Framework for transfer of unclaimed amounts by the listed entities to Escrow Accounts and claim thereof by investors;
Annex-B – Framework for transfer of unclaimed amounts from the Escrow Account of the listed entity (which are not companies) to IPEF and claim thereof by the investors.

39. Simplified norms for processing investor service requests by RTAs and norms for furnishing PAN, KYC details, and Nomination

SEBI, based on representations received from the Registrars’ Association of India, feedback from investors, and to mitigate unintended challenges on account of freezing of folios and referring frozen folios to the administering authority under the Benami Transactions (Prohibitions) Act, 1988 and Prevention of Money Laundering Act, 2002, has done away with the requirement of freezing the folios of holders of securities in physical form wherein PAN, Nomination, Contact details, Bank A/c details and Specimen signature and referral of the same by the RTAs to the aforementioned authorities.

40. Issuance and Credit of units of AIFs in dematerialized form

AIFs are required to dematerialize their units within the following timelines:

Particulars	Schemes of AIFs with corpus ≥ Rs. 500 Crore	Schemes of AIFs with corpus < Rs. 500 Crore
Dematerialization of all the units issued	Latest by October 31, 2023	Latest by April 30, 2024
Issuance of units only in dematerialized form	November 01, 2024 onwards	May 01, 2024 onwards

AIFs to open an “Aggregate Escrow Demat Account” (AEDA) to credit AIF units in cases where investors onboarded either before November 01, 2023/May 01, 2024, have not provided demat details. This account shall be used for the sole purpose of holding demat units of AIFs on behalf of such investors. New units to be issued in demat form shall be allotted to such investors and credited to the AEDA. As and when such investors provide their demat account details to the AIF, their units held in AEDA shall be transferred to the respective investors’ demat accounts within 5 working days.

Accordingly, SEBI has clarified as below regarding the issuance and credit of units of AIFs in demat form:

Details	Schemes with corpus ≥ INR 500 crore as on Oct 31, 2023	Schemes with corpus < INR 500 crore as on Oct 31, 2023, and schemes launched after Oct 31, 2023, irrespective of corpus
Investors who have provided their demat account details	Units issued after Oct 31, 2023, shall be in demat form and credited only to investors’ demat accounts.	Units issued after Apr 30, 2024, shall be in demat form and credited only to investors’ demat accounts.
Investors who have not provided their demat account details	For investors on-boarded prior to Nov 01, 2023, units shall be credited in Aggregate Escrow Demat Account temporarily, till investors provide their demat account details.	For investors on-boarded prior to May 01, 2024, units shall be credited in Aggregate Escrow Demat Account temporarily, till investors provide their demat account details.
Completion of credit of demat units to a) demat accounts of investors who have provided demat account details and b) Aggregate Escrow Demat Account, for those who have not provided demat account details	Latest by Jan 31, 2024	Latest by May 10, 2024

41. Amendments to SEBI (Issue of Capital and Disclosure Requirements) Regulations 2018 and SEBI (Listing Obligation and Disclosure Requirements) Regulations 2015

SEBI has replaced the term ‘Social Audit’ with ‘Social Impact Assessment’ in the SEBI (Issue of Capital and Disclosure Requirements) Regulations 2018 and SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 respectively.

Accordingly, the requirement for an audit of the annual impact report of a Social Enterprise registered on the Social Stock Exchange or which has raised funds through the Stock Exchange, is substituted with the assessment by a Social Impact Assessment Firm employing Social Impact Assessor.

42. Procedure to apply for a waiver of fines levied through the Listing Centre.

SEBI has directed the Exchanges that they may deviate from the actions prescribed in SOP Circulars, if found necessary, only after recording reasons in writing. Accordingly, BSE has provided the procedure to apply for a waiver of fines levied through the Listing Centre.

The Waiver application by companies shall be made by logging into at listing Centre. The path for the same is:
Listing Centre > Listing Operations > Listing Module > Issue Type > Waiver > Sub-process > Waiver
With effect from January 01, 2024, only those applications made through the Waiver Application Module of the Listing Centre would be considered valid waiver applications.

43. Foreign investment in Alternative Investment Funds (AIFs)

The investor of AIF, or its beneficial owner as determined in Rule 9(3) of the PMLA Rules, shall not be a person(s) mentioned in the Sanctions List notified from time to time by the United Nations Security Council and is not a resident in the country identified in the public statement of Financial Action Task Force as:

a jurisdiction having a strategic Anti-Money Laundering or Combating the Financing of Terrorism deficiencies to which countermeasures apply; or
a jurisdiction that has not made sufficient progress in addressing the deficiencies or has not committed to an action plan developed with the Financial Action Task Force (FATF) to address the deficiencies.

In case an investor who has been already on-boarded to the scheme of an AIF, does not meet the revised condition as specified above, the manager of the AIF shall not draw any further capital contribution from such investor for investing, until the investor meets the said condition.

44. Ease of Doing Investments by Investors - Facility of voluntary freezing/ blocking of Trading Accounts by Clients

A framework for Trading Members to provide the facility of voluntary freezing/ blocking the online access of the trading account to the clients on account of suspicious activities will be laid down on or before April 01, 2024, by the ISF, under the aegis of stock exchanges, in consultation with SEBI.

Framework to be implemented by Trading Members with effect from July 01, 2024. A compliance report is to be submitted to SEBI by Stock Exchanges by August 31, 2024.

45. Extension of timeline for verification of market rumors by listed entities

The top 100 listed entities by market capitalization to mandatorily verify and confirm, deny, or clarify market rumors from June 1, 2024, and the top 250 listed entities by market capitalization, to mandatorily verify and confirm, deny, or clarify market rumors from December 1, 2024.

46. Guidelines for returning the draft offer document and its resubmission

To ensure completeness of the offer document for investors and provide greater clarity & consistency in the disclosures and for timely processing, SEBI has issued ‘Guidelines for returning of the draft offer document and its resubmission’.

Accordingly, in addition to Schedule VI of ICDR Regulations, draft offer documents that are not compliant with the instructions provided under the said guidelines shall be returned to the issuer. The guidelines are provided as Annexure A to the SEBI Circular dated February 06, 2024.

47. Centralization of certifications under the Foreign Account Tax Compliance Act (FATCA) and Common Reporting Standard (CRS) at KYC Registration Agencies (KRAs)

SEBI has directed the intermediaries, who are Reporting Financial Institutions (RFI), to upload the FATCA and CRS certifications obtained from the clients onto the system of KRAs with effect from July 01, 2024

The existing certifications obtained from clients before July 01, 2024, shall be uploaded by the intermediaries onto the systems of KRAs within 90 days from February 20, 2024.

48.Corporate Grouping of Listed Companies

BSE has introduced an online facility for filling out information related to the change in the corporate group through the listing center. For identifying the corporate group, criteria/parameters shall, inter alia, be considered by the listed companies / proposed to be listed companies as mentioned in the Circular dated February 09, 2024. The online facility is available in the listing center login below path:

BSE Listing Centre> Listing Compliance > Corporate Group Repository.

49.SEBI (Real Estate Investment Trusts) (Amendment) Regulations, 2024

A new Chapter known as Small and Medium REITs (SM REIT) has been introduced. SM REITs shall have an asset value of at least Rs. 50 crore vis-à-vis minimum asset value of Rs. 500 crore for existing REITs.

The regulatory framework for SM REITs, inter-alia, has been provided which includes the structure of SM REITs, migration of existing structures meeting certain specified criteria, obligations of the investment manager including net worth, experience, and minimum unitholding requirement, investment conditions, minimum subscription, distribution norms, valuation of assets, etc.

50. Repeal of circular(s) outlining the procedure to deal with cases where securities are issued prior to April 01, 2014, involving the offer/allotment of securities to more than 49 but up to 200 investors in a financial year

SEBI has repealed the circulars outlining the procedure to deal with cases involving the issuance of securities prior to Apil 01, 2024 to more than 49 persons but up to 200 persons in a financial year, and which allowed companies to avoid penal action if they provide the investors with an option to surrender the securities and receive the refund amount at a price not less than the amount of subscription money paid along with 15% interest p.a. thereon or such higher return as promised to the investors.

SEBI has decided to repeal the circulars with effect from 6 months from March 13, 2024, to protect the interests of investors in securities and promote the development of and regulate the securities markets.

51. Introduction of the Beta version of the T+0 rolling settlement cycle on an optional basis in addition to the existing T+1 settlement cycle in Equity Cash Markets

A framework has been introduced for the beta version of the T+0 trade settlement cycle on an optional basis. The beta version of T+0 settlement will be introduced for a limited set of 25 scrips and with a limited number of brokers. This will be in addition to the existing T+1 settlement cycle in the equity cash market.

52. Corporate Grouping of Listed Companies

NSE mandated all Listed companies to inform NSE of any change in corporate group of such company due to Corporate Restructuring, Takeover, Merger, Demerger, Acquisition, delisting, etc., within 2 working days of the Effective Date of such change.

For the same NSE has introduced an online module to facilitate the listed companies to file the intimation of change of its corporate group through the NEAPS application link which is as below:
(Link: https://neaps.nseindia.com/NEWLISTINGCORP/login.jsp).

The path to intimate the change in Corporate Group on the NSE Portal is as follows:
NEAPS login > Compliance > Disclosures > Corporate Grouping FPI