SEBI Board Meeting 30 September, 2024 – Amendment relevant for entities having their specified Securities Listed - MMJC

Amendment in SEBI LODR relevant for entities having their specified securities listed:

1. Single Filing system: The SEBI Board has given an in-principle approval for introduction of single filing system for listed entities to file relevant reports, documents etc. on one exchange which will be automatically disseminated at the other exchange(s).

Actionable: BSE and NSE vide its circular of September 30, 2024[i] has introduced the first phase for the single filing system for “equity” listed and “equity and debt” listed companies for disclosure of Grievance Redressal Mechanism falling under Regulation 13(3) of SEBI LODR from October 01, 2024, onwards.

Once the aforesaid disclosure is filed on one Exchange it should be ensured that the acknowledgment is received from both the Exchanges.

2. Reduce multiple quarterly and half-yearly compliances by introducing an integrated filing framework:

Two broad categories of Integrated Filing have been introduced:

1. Integrated Filing (Governance) comprising of corporate governance report, statement on redressal of investor grievances and
2. Integrated Filing (Financial) comprising of financial results, statement of deviation in use of proceeds and disclosure of related party transactions and quarterly disclosure of o/s defaults on loans/ debt securities[ii] in order to reduce the number of periodic filings.

Once notified listed companies would be required to file above Integrated Filings only on quarterly and half yearly basis.

3. System driven disclosure of shareholding pattern and event-based disclosure of new credit rating or revised credit rating.

In an attempt to reduce reporting requirement -Shareholding pattern and Revision in credit ratings by Stock Exchanges will be system driven.

Shareholding pattern and credit ratings manual disclosures to be done away with.

4. Advertisement of financial results: Once notified detailed advertisement of financial results in newspapers is made optional for listed entities.

5. Timeline to fill up vacancies in board committees:

SEBI LODR already provides for time to fill up vacancies in the board of directors. Now if due to vacancy in board of directors there is also a vacancy in mandatorily committees of board e.g., audit committee, nomination and remuneration committee, stakeholder relationship committee and risk management committee etc. then there was no timeline fixed for filing up the vacancy. Now it is specified by SEBI that time of 3 months from the date of vacancy would be provided to fill up vacancies in committees of listed entities.

Further a period of three months is provided to fill up vacancies in Board, Committees and Key Managerial positions at listed entities coming out of the CIRP under Insolvency and Bankruptcy Code, 2016.   

6. Material Event Disclosures:

• Disclosure of board meeting outcome: Extended time (3 hours instead of 30 minutes) for disclosure of the outcome of Board meetings that conclude after trading hours.
• For disclosure of litigations/disputes involving claims against the listed entity, an additional time (72 hours instead of 24 hours) subject to maintaining such data in a structured digital database.
• Disclosure of tax litigations and tax disputes on the basis of materiality.
• Fines and penalties to be disclosed only: From sector regulators/enforcement agencies: If they exceed Rs 1 lakh or From other authorities: Rs 10 lakh.
  • Previously, all fines/penalties had to be disclosed within 24 hours.

[i] https://www.bseindia.com/markets/MarketInfo/DispNewNoticesCirculars.aspx?page=20240930-60

[ii] https://www.sebi.gov.in/reports-and-statistics/reports/jun-2024/consultation-paper-on-recommendations-of-the-expert-committee-for-facilitating-ease-of-doing-business-and-harmonization-of-the-provisions-of-icdr-and-lodr-regulations_84421.html