The Securities and Exchange Board of India (SEBI) on April 20, 2022 has issued a notification on Streamlining the Process of Public Issues and redressal of Investor grievances to provide a mechanism of compensation to investors for delay in unblocking of application amounts by SCSBs and has prescribed certain compliance and reporting standards to be adopted by SCSBs.
The performance of SCSBs on timely unblocking of application amounts has been reviewed and based on the feedback received from market intermediaries, a new reporting format for Annexure IV of the March’21 Circular has been devised to capture the data of all ASBA applications unblocked by SCSBs and their corresponding date of actual unblock. SCSBs shall submit the Annexure IV of the March’21 Circular in the format prescribed in Annexure IV of this circular.
The compensation prescribed in the March’21 Circular shall be applicable to all ASBA applications processed by the SCSBs.
To claim the processing fee, SCSBs shall make an application to the Merchant Bankers with a copy to the Registrar to the Issue in the format prescribed in Annexure I of this circular (complete with requisite information mentioned therein) with a copy to the Registrar to the Issue, subject to the following conditions:
a) The application shall be made no later than 30 days from the finalization of basis of allotment by Registrar to the Issue.
b) The SCSBs shall make the application only after (i) unblocking of application amounts for each application received by such SCSB has been fully completed; (ii) applicable compensation relating to investor complaints has been paid by the SCSB.
The SCSBs shall continue to be responsible to provide information requested by the Merchant Bankers/ Registrar to the Issue/ Issuer and also remain liable to pay compensation applicable as per the Circular (including any amendments thereof), for delays in unblocking of application amounts after the processing fee has been claimed by the SCSBs.
SEBI has decided that the SCSBs/UPI Apps eligible for Public Issues shall send SMS Alerts to Investors for all ASBA applications and may also provide the Invoice in the Inbox as an additional feature to verify the UPI mandate details. The SMS/Invoice in the Inbox shall include the details as prescribed in Annexure II.
This circular shall come into force with immediate effect. The provisions of this circular shall become part of the offer documents, DRHP and RHP.
[Circular No. SEBI/HO/CFD/DIL2/CIR/P/2022/51]
