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SEBI Board approves SME IPO norm changes; mandates ‘Rs. 1 crore’ operating profit in 2 of 3 preceding years for DRHP filing
SEBI, in its 208th Board Meeting, approved several amendments to regulations, including measures to enhance ease of doing business related to Business Responsibility & Sustainability Reporting, a review of the SME framework under ICDR Norms, a review of Merchant Bankers Regulations, etc.
The Board has approved amendments to the SEBI (LODR) Regulations, 2015 and SEBI (ICDR) Regulations, 2018, to mandate the issuer to have an operating profit of Rs. 1 crore from operations for any 2 out of 3 previous financial years at the time of filing of its draft red herring prospectus. Further, Offer for sale (OFS) by selling shareholders in SME IPO must not exceed 20% of the total issue size and selling shareholders cannot sell more than 50% of their holding.
Some of the key highlights of the Board Meeting are as follows –
(a) Amendments to SEBI (Depositories & Participants) Regulations, 2018 for provisions related to payment of annual fees and charge
(b) Recognition of a ‘Past Risk and Return Verification Agency’
(c) Mandating payments by listed entities to security holders in electronic form only
(d) Assigning responsibility for the use of ‘AI tools’ by MIIs and SEBI-Regulated persons
(e) Review of provisions regarding corporate governance norms for ‘High-Value Debt Listed Entities’
(f) Ease of doing business w.r.t Business Responsibility and Sustainability Report
(g) Measures towards ease of doing business for ESG Rating providers
(h) Measures towards ease of doing business for Small and Medium Real Estate Investment Trusts
(i) Amendments to SEBI (Mutual Funds) Regulations, 1996 to facilitate ease of doing business
(j) Amendments to the definition of UPSI to enhance clarity, certainty, an uniformity in compliance
SEBI extends suspension of trading in derivative contracts in 7 agro commodities to January 31, 2025
Earlier, SEBI issued directions to stock exchanges with a commodity derivatives segment to suspend trading in derivative contracts for 7 agro commodities for a period of one year. Subsequently, the suspension was extended beyond December 20, 2023, to December 20, 2024. Now, SEBI has further extended the suspension of trading in these contracts to January 31, 2025.
RP justified in refusing to hand over Wind Turbine Generators as appellant-OC failed to make payment of dues lying with CD: SC
Vish Wind Infrastrukture LLP v. Shailen Shah, Resolution Professional of Wind World (India) Ltd. - [2024] 169 taxmann.com 347 (SC)
In the instant case, the appellant-operational creditor had entered into an agreement with the corporate debtor for the supply of Wind Turbine Generators (WTGs). The corporate debtor supplied WTGs for which payments were made by the appellant.
Meanwhile, the CIRP was initiated against the corporate debtor and, the appellant had filed its claim of Rs. 132 crores, claiming it to be an advance payment made to the corporate debtor for the supply of WTGs. The claim of the appellant was admitted in the CIRP.
Later, the appellant made a request to RP to supply WTGs in terms of the agreement. The RP rejected the said request on the ground that the appellant owed an amount along with an interest to the corporate debtor and, the appellant’s claim had already been admitted in the CIRP.
The appellant had filed an application before the NCLT seeking a direction for RP to adhere to the terms of agreement and supply immediately WTGs. However, the NCLT vide order rejected the said application. The appellant then challenged the said order before the NCLAT.
The NCLAT vide the impugned order rejected the said application on the ground that the corporate debtor had not received dues from the appellant for which arbitration proceedings were pending. Thus, the decision taken by RP not to handover WTGs was as per the wisdom of RP, who was to run the corporate debtor as a going concern.
The NCLAT further held that RP's decision to refuse the handover of 26 WTGs lying with the corporate debtor was a decision that RP was entitled to take as per the scheme of the Code, which decision could not be said to be contrary to any provisions of the Code or in breach of any right of the appellant.
The Supreme Court held that the appeal filed by the appellant against the order of the NCLAT was to be dismissed.
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Founder Partner | Diploma in Systems Audit DISA (ICAI)
2 个月Progress is built on adaptability. SEBI’s updates remind us that refining processes isn’t just about rules, it’s about creating environments where growth and trust can thrive. These changes underscore SEBI’s commitment to fostering a transparent and investor-friendly ecosystem, balancing regulation with opportunity.