Latest notification of SEBI on SEBI LODR (Amendment) Regulations, 2021

Latest notification of SEBI on SEBI LODR (Amendment) Regulations, 2021

The Securities and Exchange Board of India (SEBI) issued a notification on 8 January 2021 wherein it notified the SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2021 (Regulations) that seeks to amend SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (previous regulations)

The SEBI has issued a notification wherein it sought to amend the previous regulations with a new one. The said notification of SEBI came into force on 8 January 2021. It introduced new regulations of 2021 that have amended the previous regulations of 2015.

Following are certain major changes that are introduced by the latest regulations-

- In Schedule III, in Part A, clause 16, the existing sub-clause(l) shall be substituted with specific features and details of the resolution plan as approved by the Adjudicating Authority under the Insolvency Code

- It shall not involve commercial secrets, that includes details related to Pre and Post net-worth of the company

- Details of assets of the company post-Corporate Insolvency Resolution Process(CIRP)

- Details of securities continuing to be imposed on the companies' assets

- Other material liabilities imposed on the company

- Detailed pre and post shareholding pattern assuming 100% conversion of convertible securities

- Details of funds infused in the company, creditors paid-off

- Additional liability on the incoming investors due to the transaction, source of such funding etc.

- Impact on the investor revised Price Earning (P/E), Return on Net Worth (RONW) ratios etc.

- Names of the new promoters, key managerial persons(s), if any, and their experience in the business or employment

- Cases where promoters are companies, then in that case history of such companies and names of natural persons in control; and a brief description of business strategy is required

The new regulations of 2021 further mention certain new insertions in Schedule III, in Part A under point A, in clause 16, after the existing sub-clause (m). It mentions that a new clause shall be inserted wherein-

- It proposed steps that are to be taken by the incoming investor/acquirer for achieving the Minimum Public Shareholdings (MPS)

- Quarterly disclosure of the status of achieving the MPS, and the details as to the delisting plans, if any approved in the resolution plan