The Securities and Exchange Board of India (SEBI) on January 14, 2025, issued a Consultation Paper on certain amendments to SEBI LODR Regulations, 2015 with the objective of encouraging dematerialization of securities and streamlining certain processes in view of the current regulatory landscape.
This consultation paper seeks comments/views/suggestions from the public and other stakeholders on the following proposals relating to amendments to the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015:
• Mandating issuance of new securities pursuant to (i) consolidation/split of face value of securities and (ii) scheme of arrangements, only in dematerialised form.
• Modification to certain provisions in view of current market developments.
In order to achieve the objective as stated above, it is proposed to amend SEBI (LODR) Regulations, 2015 to mandate the issuance of securities only in Demat form in case of sub-division/split/consolidation of the face value of securities and scheme of arrangement to encourage Demat holding of securities.
In case an investor does not have a Demat account then the Issuer companies shall be required to open a separate Demat account with a suitable ledger of ownership (“suspense escrow account”) for dealing with such securities.
The Comments/suggestions are solicited from public on the following point:
• Whether issuance of new securities pursuant to (i) subdivision / split / consolidation of Face Value of Securities and Scheme of Arrangement, should be compulsorily allowed in dematerialised form only?
• Whether there is a need to amend aforesaid provisions of SEBI LODR Regulations in view of current regulatory landscape?
The comments/suggestions along with rationale should be submitted no later than February 04, 2025, through the following link:
https://www.sebi.gov.in/sebiweb/publiccommentv2/PublicCommentAction.do?doPublicComm
