The Securities and Exchange Board of India (SEBI) on August 06, 2024, issued an amendment to the Master Circular for Real Estate Investment Trusts (REITs) dated May 15, 2024 – Board nomination rights to unitholders of REITs.
Para 18.2.2. (b) of Chapter 18, titled “Board nomination rights to unitholders of REITs”, of the Master Circular for Real Estate Investment Trusts dated May 15, 2024, requires as follows:
“(b) Eligible Unitholder(s) shall be entitled to nominate only one Unitholder Nominee Director, subject to the unitholding of such Eligible Unitholder(s) exceeding the specified threshold. If the right to nominate one or more directors on the Board of Directors of the Manager is available to any entity (or to an associate of such entity) in the capacity of shareholder of the Manager or lender to the Manager or the REIT (or its HoldCo(s) or SPVs), then such entity in its capacity as unitholder, shall not be entitled to nominate or participate in the nomination of a Unitholder Nominee Director.”
It is proposed that the following proviso be included under paragraph 18.2.2. (b) of Master Circular for Real Estate Investment Trusts dated May 15, 2024:
“Provided that the above restriction relating to the right to nominate a Unitholder Nominee Director shall not be applicable if the right to appoint a nominee director is available in terms of clause (e) of sub-regulation (1) of regulation 15 of the SEBI (Debenture Trustees) Regulations, 1993.”
This circular shall come into force with immediate effect.
[Circular No. SEBI/HO/DDHS/DDHS-PoD-2/P/CIR/2024/108]
