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Non-compliance with provisions related to continuous disclosures- (Securities and Exchange Board of India) (29 Dec 2021)


Capital Market

1. SEBI vide circular no. SEBI/HO/DDHS/DDHS/CIR/P/2020/231 dated November 13, 2020 prescribed a uniform structure for levying fines and taking action for non-compliance with continuous disclosure requirements specified under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI LODR Regulations"), by the issuers of listed Non-Convertible Securities and/or Commercial Papers.

2. Pursuant to the recent amendments to SEBI LODR Regulations, it has been decided to issue the present circular in supersession of the aforesaid circular bearing number SEBI/HO/DDHS/DDHS/CIR/P/2020/231 dated November 13, 2020.

3. In view of the above, in the interests of investors and the securities market, the Stock Exchanges shall levy fine and take action in case of non-compliances with continuous disclosure requirements by the issuers of listed Non-Convertible Securities and/or Commercial Paper as specified in Annexure I and Annexure II of this circular respectively.

4. Stock Exchanges may deviate from the above, if found necessary, only after recording reasons in writing.

5. In case a non-compliant entity is listed on more than one recognized stock exchange, the concerned recognized stock exchange(s) shall take uniform action under this circular in consultation with each other.

6. The recognized stock exchanges shall take necessary steps to implement this circular and shall disclose on their website the action(s) taken against the entities for non-compliance(s); including the details of the respective requirement, amount of fine levied/action taken etc.

7. The amount of fine realized as per the structure provided in Annexure I of this circular shall be credited to the "Investor Protection Fund" of the concerned recognized stock exchange.

8. The fines specified in Annexure I of this circular shall continue to accrue till the time of rectification of the non-compliance and to the satisfaction of the concerned recognized stock exchange. Such accrual shall be irrespective of any other disciplinary/enforcement action(s) initiated by recognized stock exchange(s)/SEBI.

9. The recognized stock exchanges may keep in abeyance the action or withdraw the action in specific cases where specific exemption from compliance with the requirements for continuous disclosures/moratorium on enforcement proceedings has been provided for under any Act, Court/Tribunal Orders etc.

10. The above provisions are without prejudice to the power of SEBI to take action under the securities laws.

11. The recognized stock exchanges are advised to bring the provisions of this circular to the notice of issuers of listed Non-Convertible Securities and/or Commercial Paper.

12. This circular shall come into force for the due dates of compliances falling on or after February 01, 2022. It may be noted that the circular dated November 13, 2020 would be applicable till the time current circular comes into force.

13. This circular is issued in exercise of the powers conferred under sections 11(1) and 11A(2) of the Securities and Exchange Board of India Act, 1992 read with Section 9 and 21 of Securities Contracts (Regulation) Act, 1956.

14. The recognized stock exchanges may make consequent changes in their byelaws, if any, to implement this circular.


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