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Notification No.: No. SEBI/LAD-NRO/GN/2024/218
Notification Date: December 12, 2024
Relevant Regulations: SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
SEBI has amended SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (herein after referred to as LODR) by notification of SEBI (Listing Obligations and Disclosure Requirements) (Third Amendment) Regulations, 2024 on December 12, 2024. All the said amendments shall come into force on the date of publication in Official Gazette, viz. December 12, 2024 except sub-regulations VI and XX of regulation 3 of these regulations which shall come into force with effect from December 31, 2024.
Major amendments amongst others include:
a). Definition of half year as listed in Regulation 2(1)(k) has been omitted
b). Deletion of the words ‘by listed entity’ in clause b of Regulation 2(1)(zc), first proviso pertaining to transactions which shall not be considered as a Related Party Transaction
c). Insertion of new clause (d) & (e) after clause (c) of Regulation 2(1)(zc), first proviso, namely:
“(d) acceptance of current account deposits and saving account deposits by banks in compliance with the directions issued by the Reserve Bank of India or any other central bank in the relevant jurisdiction from time to time: Explanation: For the purpose of clauses (c) and (d) above, acceptance of deposits includes payment of interest thereon.
(e) retail purchases from any listed entity or its subsidiary by its directors or its employees, without establishing a business relationship and at the terms which are uniformly applicable/offered to all employees and directors:”
d) The existing definition of securities laws has been further expanded by substitution of clause(zf) in regulation 2, in sub-regulation (1), as follows:
“(zf) “securities laws” means the Act, the Securities Contracts (Regulation) Act, 1956, the Depositories Act, 1996 and the rules and regulations made thereunder and the general or special orders, guidelines or circulars made or issued by the Board thereunder and the provisions of the Companies Act, 2013 or any previous company law and any subordinate legislation framed thereunder, which are administered by the Board;
e) ‘SR equity shares’ have been defined by insertion of new clause (zla), after clause(zl) in regulation 2, in sub-regulation (1), as follows:
“(zla) “SR equity shares” means the equity shares of a listed entity having superior voting rights compared to all other equity shares issued by that listed entity;”
f) A new proviso shall be inserted after Regulation 6(1) which pertains to appointment of a qualified company secretary as the compliance officer, as follows:
“Provided that the Compliance Officer shall be an officer, who is in whole time employment of the listed entity, not more than one level below the board of directors and shall be designated as a Key Managerial Personnel.”
g) In regulation 6, after sub-regulation (1A) and the proviso thereto, the following new-sub-regulation shall be inserted, namely,-
“(1B) Any vacancy in the office of the Compliance Officer of such listed entity in respect of which a resolution plan under section 31 of the Insolvency Code has been approved, shall be filled within a period of three months of such approval:
Provided that, in the interim, such listed entity shall have not less than one full-time key managerial personnel managing its day-to-day affairs.”
h) Regulation 7(3) has been omitted, hence the requirement of submitting a compliance certificate to the exchange, duly signed by both the compliance officer of the listed entity and the authorised representative of the share transfer agent, wherever applicable, within [thirty days from the] end of the financial year, certifying compliance with the requirements of sub- regulation (2), has been done away with.
i) Insertion of sub-regulation(1A) after Regulation 10(1), as follows:
“(1A) The Board may enable integrated filing of periodic reports, statements, documents and any other information required to be filed by a listed entity under the Act or the regulations made thereunder in the format and within the timelines as may be specified.”
j) Regulation 13(3) has been substituted whereby the timeline of 21 days from end of quarter allowed for filing of Statement of redressal of Investor Grievances has been changed to timeline to be prescribed by SEBI. This change will be effective from December 31, 2024
k) Symbol 26A to be inserted in Regulation 15(2) as prescribed
l) In Regulation 15 (clause a)(second proviso),words above regulations shall be replaced ‘with the words, numerals and symbols “corporate governance provisions as specified in regulations 17 to 27, clauses (b) to (i) and (t) of sub-regulation (2) of regulation 46 and para C, D and E of Schedule V’ and the words “or” appearing after the words “equity share capital” and before the words and symbol “the net-worth of such entity”, shall be substituted with the word “and”
m) In Regulation 16(1)(c), the word “income” wherever appearing shall be substituted by the word “turnover”
n) In Regulation 16(1), clause (d), which defines ‘senior management’, the words “Company Secretary and the Chief Financial Officer” shall be substituted by the words and symbols “persons identified and designated as key managerial personnel, other than the board of directors, by the listed entity”
o) Regulation 17(1A) deals with the appointment /continuance of appointment of any person as Non-executive Director who has attained 75 years only if a special resolution has been passed to that effect. A new proviso has been inserted whereby the listed entity shall ensure the compliance of above provision at the time of appointment or re-appointment or any time prior to the non-executive director attaining the age of seventy- five years
p) Entire sub-regulation (1C) of Regulation 17 has been substituted
q) In regulation 17, in sub-regulation (1E), in the existing first proviso – after the words and symbols “under sub-regulation (1) of this regulation,” and before the words “due to expiration of the term of office”, the words and symbols “sub-regulation (1) of regulation 18, sub-regulation (1) or (2) of regulation 19, sub-regulation (2) or (2A) of regulation 20 or sub-regulation (2) or (3) of regulation 21,” shall be inserted ;
and before the existing first proviso, the following new proviso shall be inserted, namely,- “Provided that if the vacancy in the office of a director results in non-compliance with the provisions of sub-regulation (1) of regulation 18, sub-regulation (1) or (2) of regulation 19, sub-regulation (2) or (2A) of regulation 20 or sub-regulation (2) or (3) of regulation 21, the listed entity shall ensure compliance at the earliest and in any case not later than three months from the date of such vacancy:”
r) Regulation 17(2) to be read as:
The board of directors shall meet at least four times a financial year, with a maximum time gap of one hundred and twenty days between any two consecutive meetings.
s) Insertion of ‘along with the rationale’ in the explanatory statement in Regulation 17(11)
t) Meetings of the Audit Committee to be read as( Reg. 18(2) clause(a)):
The audit committee shall meet at least four times in a financial year and not more than one hundred and twenty days shall elapse between two consecutive meetings.
u) Regulation 19(3A) to be read as under:
The nomination and remuneration committee shall meet at least once in a financial year
v) Regulation 20(3A) to be read as under:
The stakeholders relationship committee shall meet at least once in a financial year.
w) Regulation 21(3A) to be read as under:
The risk management committee shall meet at least twice in a financial year.
x) In regulation 23, in sub-regulation (2), in the second proviso, after clause (d) and the Explanation thereto, the following new clauses and the proviso shall be inserted:
“(e) remuneration and sitting fees paid by the listed entity or its subsidiary to its director, key managerial personnel or senior management, except who is part of promoter or promoter group, shall not require approval of the audit committee provided that the same is not material in terms of the provisions of sub-regulation (1) of this regulation.
(f) The members of the audit committee, who are independent directors, may ratify related party transactions within three months from the date of the transaction or in the immediate next meeting of the audit committee, whichever is earlier, subject to the following conditions: (i) the value of the ratified transaction(s) with a related party, whether entered into individually or taken together, during a financial year shall not exceed rupees one crore; (ii) the transaction is not material in terms of the provisions of sub-regulation (1) of this regulation; (iii) rationale for inability to seek prior approval for the transaction shall be placed before the audit committee at the time of seeking ratification; (iv) the details of ratification shall be disclosed along with the disclosures of related party transactions in terms of the provisions of sub-regulation (9) of this regulation; (v) any other condition as specified by the audit committee: Provided that failure to seek ratification of the audit committee shall render the transaction voidable at the option of the audit committee and if the transaction is with a related party to any director, or is authorised by any other director, the director(s) concerned shall indemnify the listed entity against any loss incurred by it.”
y) A new proviso has been inserted in Regulation 23(9) after third proviso, to remove the requirement of disclosure of remuneration and sitting fees paid to Directors & KMP except who is part of promoter or promoter group, if the same is immaterial.
z) In regulation 24, in sub-regulation (1), in the Explanation, the word “income” wherever appearing shall be substituted with the word “turnover”; and insertion of non-obstante clause after Reg. 24(6):
“Nothing contained in this sub-regulation shall be applicable if such sale, disposal or lease of assets is between two wholly-owned subsidiaries of the listed entity
aa) Substitution of Regulation 24A(1) to provide as follows:
Every listed entity and its material unlisted subsidiaries incorporated in India shall undertake Secretarial Audit by a Secretarial Auditor who shall be a Peer Reviewed Company Secretary and shall annex a Secretarial Audit Report in such form as specified, with the annual report of the listed entity.
bb) Provisions relating to appointment/re-appointment of Secretarial Auditor with approval of shareholders in AGM inserted. Also the casual vacancy arising out of resignation, death or disqualification of a Secretarial Auditor shall be filled by the board of directors of the listed entity within a period of three months and the secretarial auditor so appointed shall hold office till the conclusion of the next annual general meeting. Further new sub-regulations have been inserted w.r.t eligibility, qualifications and disqualifications of Secretarial Auditor which have to be complied with w.e.f April 1, 2025.
cc) A new proviso has been inserted in Regulation 24A(2) which provides that the listed entity shall ensure that with effect from April 1, 2025, the Secretarial Compliance Report submitted to the stock exchange(s) on annual basis is signed only by the Secretarial Auditor or by a Peer Reviewed Company Secretary who satisfies the conditions mentioned in sub-regulations (1A) and (1B) of this regulation.
dd) In regulation 26A, after the existing sub-regulation (2) and the provisos thereto, the following new sub-regulation shall be inserted, namely,-
“(3) Any vacancy in the office of Chief Executive Officer, Managing Director, Whole Time Director or Manager or Chief Financial Officer of such listed entity in respect of which a resolution plan under section 31 of the Insolvency Code has been approved, shall be filled within a period of three months of such approval: Provided that, in the interim., such listed entity shall have not less than one full-time key managerial personnel managing its day-to-day affairs.”
ee) Changes in timeline of submission of Corporate Governance Report from ‘within 21 days of the end of each quarter’ to ‘within the timelines, as may be specified by the Board from time to time.”[Regulation 27(2)clause (a) and clause (b) has been omitted]. This change shall be effective from December 31, 2024
ff) Regulation 30(6) clause (i) provides that a listed entity shall disclose material events or information within 30 minutes from the closure of Board meeting in which the decision pertaining to the event or information has been taken. New proviso inserted after Regulation 30(6) clause (i) which provides :
“Provided that in case the meeting of the board of directors closes after normal trading hours of that day but more than three hours before the beginning of the normal trading hours of the next trading day, the listed entity shall disclose the decision pertaining to the event or information, within three hours from the closure of the board meeting: Provided further that in case the meeting of the board of directors is being held for more than one day, the financial results shall be disclosed within thirty minutes or three hours, as applicable, from closure of such meeting for the day on which it has been considered.”
gg) A new proviso has been inserted in Regulation 30(6), after clause (iii) and before existing proviso stating that if relevant information about claims against the listed entity , excluding tax related disputes is maintained in SDD, disclosure has to be made within 72 hours of receiving Notice
hh) Regulation 31A(2) which provides for Re-classification of the status of any person as a promoter or public by S.E. only upon receipt of an application from the listed entity has been omitted
ii) Substitution of Regulation 31A(3) Clause (a) such that the promoters seeking re-classification shall make request for re-classification to the listed entity along with rationale for the same. Listed entity to seek NOC of S.E. for such reclassification along with the views of the board of directors within five days of consideration of the request by the board of directors. The listed entity shall place the reclassification request before the shareholders in a general meeting for approval, within sixty days of receipt of no-objection letter from the recognized stock exchange, along with the views of the board of directors on the request and the no-objection letter received from the recognized stock exchanges. The listed entity shall further notify the stock exchanges within five days of obtaining shareholder approval and effect the reclassification.
jj) Regulation 36(1)(b) provides for sending hard copy of the statement containing the salient features of all the documents, as prescribed in Section 136 of Companies Act, 2013 or rules made thereunder to those shareholder(s) whose email ids are not registered with the listed entity. The same has been substituted such that instead ‘A letter providing the web-link, including the exact path, where complete details of the Annual Report is available’ shall be sent.
kk) Omission of the requirement of sending annual report referred to the holders of securities, not less than twenty-one days before the annual general meeting.( Reg. 36(2))
ll) Sub-regulations (2), (3), (6), (8), (9) and (10) of Regulation 40 pertaining to Transfer or transmission or transposition of securities shall be omitted
mm) Time period of giving Notice of Record Date has been reduced from 7 to 3 working days (regulation 42(2))
nn) Regulation 42(3) has been omitted which dealt with ‘The listed entity shall recommend or declare all dividend and/or cash bonuses at least five working days (excluding the date of intimation and the record date) before the record date fixed for the purpose.’
oo) Regulation 42(4) has been amended whereby the listed entity shall ensure the time gap of at least 5 working days between two record dates from earlier 30 days
pp) Regulation 42(5) which dealt with intimation of date of closure of transfer books for physical shares has been omitted
qq) A new proviso ‘The requirement to send proxy forms shall not be applicable to general meetings held only through electronic mode’ shall be inserted in regulation 44(4)
rr) Memorandum of Association and Articles of Association and a brief profile of board of directors including directorship and full-time positions in body corporates shall also be placed on the website of the company besides other information(Regulation 46(2))
ss) Regulation 47(1) pertaining to advertisements in newspapers to be substituted as follows:
‘The listed entity shall publish an advertisement in the newspaper, within forty-eight hours of conclusion of the meeting of board of directors at which the financial results were approved, containing a Quick Response code and the details of the webpage where complete financial results of the listed entity, as specified in regulation 33, along-with the modified opinion(s) or reservation(s), if any, expressed by the auditor, is accessible to the investors.
Nothing provided under this regulation shall preclude a listed entity from publishing, if it so chooses, the financial results in terms of regulation 33 along-with the modified opinion(s) or reservation(s), if any, expressed by the auditor in the newspaper as per the format specified within 48 hours of conclusion of the meeting of the board of directors at which the financial results were approved.’
Existing sub-regulations (2) and (3) of Regulation 47 and the proviso thereto shall be omitted
tt) Existing clause (b) of Regulation 52(2) to be substituted with the following:
‘The quarterly financial results submitted shall be approved by the board of directors’
& after clause (b) and before clause (c), the following clause (ba) shall be inserted, namely, – “(ba) The financial results submitted to the stock exchange shall be signed by the chairperson or managing director, or a whole time director or in the absence of all of them, it shall be signed by any other director of the listed entity who is duly authorized by the board of directors to sign the financial results.”
uu) In Schedule II, in Part E, in Paragraph A, after sub-paragraph (i), the following new sub-paragraph shall be inserted, namely,-
“(ii) The listed entities ranked from 1001 to 2000 as per the list prepared by recognized stock exchanges in terms of sub-regulation (2) of regulation 3 shall endeavour to have atleast one woman independent director on its board of directors.”
vv) In Schedule II, in Part E, after Paragraph E, the following new paragraphs shall be inserted, namely,-
“F. Independent Directors The independent directors of top 2000 listed entities as per market capitalization shall endeavour to hold at least two meetings in a financial year, without the presence of non-independent directors and members of the management and all the independent directors shall endeavour to be present at such meetings.
G. Risk Management Listed entities ranked from 1001 to 2000 in the list prepared by recognized stock exchanges in terms of sub-regulation (2) of regulation 3 may constitute a risk management committee with the composition, roles and responsibilities specified in regulation 21.”
ww) Besides above, various amendments have been made in Schedule to the LODR Regulations as detailed in sub-regulation XXXVIII & XXXIX of Regulation 3 of SEBI (Listing Obligations and Disclosure Requirements) (Third Amendment) Regulations, 2024.
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