Comprehensive comparative analysis of SEBI (Listing Obligations and Disclosure Requirements) (Second Amendment) Regulations, 2021.

Regulation

Erstwhile provisions

Amended provisions

Regulation 7-Share TransferAgent

Compliance Certificate Shall be submitted within one month of end of each half of the financial year (half yearly)

Compliance Certificate Shall be submitted within 30 days of the end of the financial year (annually).

Regulation  15- Corporate Governance

Under  Reg.15(2)(a), after the existing proviso, a new proviso inserted:

Provided further that once the corporate governance provisions become applicable to a listed entity, they shall continue to remain applicable till such time the equity share capital or the net-worth of such entity reduces and remains below the specified threshold (equity share capital not exceeding rupees ten crore and net worth not exceeding rupees twenty five crore) for a period of 3 consecutive financial years.

Regulation 21(2)- Risk Management Committee

Applicable to top 500 listed entities, on the basis of market capitalisation.

Applicable to top 1000 listed entities, on the basis of market capitalisation.

Composition of Risk Management Committee:

Majority members of the board of directors.

2/3^rd Independent Directors in case of outstanding SR equity shares.

Composition of Risk Management Committee:

Minimum 3 members with majority of them being members of the board of directors, including at least 1 independent director.

2/3^rd Independent Directors in case of outstanding SR equity shares.

The risk management committee shall meet at least once in a year.

The risk management committee shall meet at least twice in a year.

New Reg. 3(b) inserted;

The quorum for a meeting of the RMC shall be either 2 members or 1/3rd of the members of the committee, whichever is higher, including at least 1 member of the board of directors in attendance.

New Reg. 3(c) inserted:

The meetings of the RMC shall be conducted in such a manner that on a continuous basis not more than 180 days shall elapse between any two consecutive meetings.

A new proviso inserted after regulation 21(4):

The role and responsibilities of the Risk Management Committee shall mandatorily include the performance of functions specified in Part D of Schedule II.

New Reg. 21(6) inserted: 

The Risk Management Committee shall have powers to seek information from any employee, obtain outside legal or other professional advice and secure attendance of outsiders with relevant expertise, if it considers necessary.

Regulation 22(1)- Vigil mechanism.

The listed entity shall formulate a vigil mechanism for directors and employees to report genuine concerns.

The listed entity shall formulate a vigil mechanism/ whistle blower policy for directors and employees to report genuine concerns.

Regulation-24(5) Material subsidiary

A listed entity shall not dispose of shares in its material subsidiary resulting in reduction of its shareholding (either on its own or together with other subsidiaries) to less than fifty percent or cease the exercise of control over the subsidiary without passing a special resolution in its General Meeting.

A listed entity shall not dispose of shares in its material subsidiary resulting in reduction of its shareholding (either on its own or together with other subsidiaries) to less than or equal to fifty percent or cease the exercise of control over the subsidiary without passing a special resolution in its General Meeting.

Regulation 24(A)- Secretarial Audit

Every listed entity and its material unlisted subsidiaries incorporated in India shall undertake secretarial audit and shall annex with its annual report, a secretarial audit report, given by a company secretary in practice, in such form as may be specified.

Every listed entity and its material unlisted subsidiaries incorporated in India shall undertake secretarial audit and shall annex a secretarial audit report given by a company secretary in practice, in such form as specified, with the annual report of the listed entity (regulation 24A numbered as regulation 24(1)).

New Reg. 24(2) inserted:

Every listed entity shall submit a secretarial compliance report in such form as specified, to stock exchanges, within 60 days from end of each financial year (aligned with  SEBI Circular No.: CIR/CFD/CMD1/27/2019 dated February 08, 2019.)

Regulation 25(3)- Meeting of Independent Director

The independent directors of the listed entity shall hold at least one meeting in a year.

The Independent Director of the listed entity shall hold one meeting in a financial year (aligned with Clause VII of Schedule II to the Companies Act, 2013).

Regulation 27-Corporate Governance Report.

To be submitted within 15 days from close of quarter.

To be submitted within 21 days from the end of each quarter.

Regulation 29(1)(f)- Prior intimation of board meeting

The listed entity shall give prior intimation to stock exchange about the meeting of the board of directors for considering the proposal of declaration of bonus securities, if it is a part of agenda papers of the Board meeting.

Now prior intimation to be given to stock exchange about the meeting of the board of directors for considering the proposal of declaration of bonus securities irrespective of whether the same is a part of the agenda papers or not.

Regulation 30(6)- Outcome of board meeting

Disclosure with respect to events specified in sub-para 4 of Para A of Part A of Schedule III shall be made within 30 minutes of the conclusion of the board meeting.

Disclosure of Event specified in sub-para 4 of Para A of Part A of Schedule III shall be made within the timelines specified therein.

Timelines specified in sub-para 4 of Para A of Part A of Schedule III

The listed entity shall disclose to the Exchange(s), within 30 minutes of the closure of the Board meeting.

Provided that in case of board meetings being held for more than 1 day, the financial results shall be disclosed within 30 minutes of end of the meeting for the day on which it has been considered (new proviso inserted in Schedule III, in Part A, in Paragraph A, in clause 4,  after the sub-clause (i)).

Regulation 32 (6)- Statement of deviation(s) or variation(s)

Where the listed entity has appointed a monitoring agency to monitor utilisation of proceeds of a public or rights issue, the listed entity shall submit to the stock exchange(s) any comments or report received from the monitoring agency (no timeline specified).

Where the listed entity has appointed a monitoring agency to monitor utilisation of proceeds of a public or rights issue, the listed entity shall submit to the stock exchange(s) any comments or report received from the monitoring agency within 45 days from the end of each quarter. (timeline specified).

Regulation 33(6)- Statement on Impact of audit qualification

The statement on Impact of audit qualification (for audit report with modified opinion) and the accompanying annual audit report shall be reviewed by Stock Exchange.

Now, the same has been done away with.

Regulation 34(2)(f)-Business Responsibility Report

Business Responsibility Report to be submitted by top 500 listed entity on basis of market capitalisation.

Business Responsibility Report (BRR) to be submitted by top 1000 listed entities based on market capitalization.

This requirement to submit BRR shall be discontinued after the financial year 2021–22.

With effect from financial year 2022–23, the top 1000 listed entities based on market capitalization shall submit a business responsibility and sustainability report in the format as specified by the Board from time to time.

Regulation 36(3)(e)- Document and information to be provided to shareholders

In case of the appointment of a new director or re-appointment of a director, the shareholders must be provided shareholding of non-executive directors.

In case of the appointment of a new director or re-appointment of a director, the shareholders must be provided shareholding of non-executive director in the listed entity,  including shareholding as a beneficial owner.

Regulation 37- Scheme of Arrangement

Requirement to obtain Observation Letter or No objection Letter from stock exchange before filing any scheme of arrangement under Sections 230-234 and Section 66 of Companies Act, 2013, whichever applicable.

Requirement of obtaining Observation Letter from stock exchange has been done away with.

Regulation 40(9)- Compliance Certificate with respect to  transfer, sub-division, consolidation, renewal, exchange or endorsement of calls/allotment monies.

To be submitted within 1 month of the end of each half of the financial year (half yearly).

To be submitted within 30 days of the end of the financial year (annually).

Regulation 43A- Dividend Distribution Policy

Applicable to top 500 listed entities based on market capitalization. Dividend distribution policy shall be disclosed by the listed entity in their annual reports and on their websites.

The listed entities (other than top 500)  may disclose their dividend distribution policies on a voluntary basis in their annual reports and on their websites.

Applicable to top 1000 listed entities based on market capitalization.

Dividend distribution policy shall be disclosed on the website of the listed entity and a web-link shall also be provided in their annual reports.

The listed entities (other than top 1000) may disclose their dividend distribution policies on a voluntary basis on their websites and provide a web-link in their annual reports.

Regulation 44(3)- Meeting of Shareholders and Voting

The listed entity shall Submit to stock exchange details regarding the voting result within 48 Hours of conclusion of its General Meeting.

The listed entity shall submit to stock exchange details regarding the voting result within 2 working days of conclusion of its General Meeting.

Regulation 45(3)- Change in name

The Listed entity shall before filing the request for change of name with the Registrar of Companies, seek approval from Stock Exchange by submitting a certificate from chartered accountant stating compliance with conditions provided in regulation 45(1).

Requirement of Stock Exchange approval has been omitted.

Explanatory statement to the notice seeking shareholders’ approval for change in name, shall include a certificate from a practicing chartered accountant stating compliance with conditions provided in regulation 45(1).

Regulation 46(2)(o)- Website Disclosure

Schedule of analyst or institutional investor meet:

The listed entity is required to disclose the schedule of analyst or institutional investor meet and the presentations made to them on its website under regulation 46.

 The word “meet” have explained as shall mean group meetings or group conference calls conducted physically or through digital means.

The presentation and the audio/video recordings shall be promptly made available on the website and in any case, before the next trading day or within 24 hours from the conclusion of such calls, whichever is earlier for a minimum period of five years and thereafter as per the archival policy of the listed entity and the transcripts of such calls shall be made available on the website within 5 working days of the conclusion of such calls, and shall be hosted on the website of the listed entity and preserved in accordance with clause (a) of regulation 9.

The requirement for disclosure(s) of audio/video recordings and transcript shall be voluntary with effect from April 01, 2021 and mandatory with effect from April 01, 2022.

Audited financial statement of subsidiary company:

The audited financial statements of each of the subsidiaries was required to be placed on the website prior to the amendment regulations.

Additional disclosures shall be made on the website of the company:

• Secretarial compliance report
• Disclosure of the policy for determination of materiality of events or information
• Contact details of KMP authorized for the purpose of determining materiality of an event or information
• Statements of deviation(s) or variation(s) as specified in regulation 32
• Dividend distribution policy
• Annual return as provided under section 92 of the Companies Act, 2013

Regulation 47 -Newspaper advertisement

The listed entity shall publish notice of the Board  meeting where financial results shall be discussed and statements of deviation(s) or variation(s).

The requirement to publish notice of meeting of the board of directors where financial results shall be discussed and statements of deviation(s) or variation(s) has been done away with.