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Sebi Comes Out New Framework To Check Non-compliance Of Listing Rules

According to a Sebi circular, exchanges can impose a fine of Rs 50,000 per instance for non-compliance with respect to obtaining in-principle approval of bourses before issuance of securities.

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Sebi on Wednesday put in place a stricter mechanism to deal with non-compliance of listing conditions under which stock exchanges will have powers to slap penalties up to Rs 50,000 for certain violations.

At present, a stock exchange is allowed to charge a maximum amount of Rs 10,000 for each violation of listing norms that need to be complied with by companies.

According to a Sebi circular, exchanges can impose a fine of Rs 50,000 per instance for non-compliance with respect to obtaining in-principle approval of bourses before issuance of securities.

The bourses can levy a fine of Rs 25,000 each in cases of non-disclosure of dividend distribution policy in annual reports and on the websites of the entities.

The amount would also be applicable in the cases of non-convening of annual general meeting within a period of five months from the close of a financial year and for not taking exchange’s approval before filing request for change of name with Registrar of Companies (RoC).

The new framework would come into force with effect from compliance periods ending on or after March 31, 2020.

The move is aimed at maintaining consistency and adopting a uniform approach in the matter of levy of fines for non-compliance with certain provisions of the listing regulations.

Besides, the exchanges can impose a penalty of Rs 10,000 for delay in furnishing prior intimation about the company’s board meeting as well as delay in non-disclosure of record date or dividend declaration, and non-compliance with norms pertaining to having a functional website.

(PTI)


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