Mumbai: To safeguard investors of firms listed on non-operational bourses, capital market regulator Sebi on Friday asked to all such companies to get listed on the nationwide stock exchanges within 18 months.
The promoters and directors of such companies who would fail to list even after the extended time of 18 months would have to undergo 'stricter scrutiny' for their any future association with securities market.
The move comes as exclusively listed companies of de-recognised, non-operational or exited stock exchanges have sought time to list in nationwide bourses.
The Securities and Exchange Board of India (Sebi) received representations from such companies stating that "although they are interested and eligible to migrate to the main boards of nationwide stock exchanges, they are not in a position to opt for the same due to paucity of time."
"In the interest of investors of such companies, it has been decided to allow a time line of 18 months, within which such companies shall obtain listing upon compliance with the listing requirements of the nation-wide stock exchange, Sebi said in a circular.
However, the timeline has been given, subject to the certain conditions including listing in nation-wide stock exchanges is permitted only in respect of those class of securities that were already listed in the non-operational bourse.
These companies seeking listing on nation-wide exchanges would not undergo any material changes in their shareholding pattern which suggests change of control at the time of listing.
The firms which have been moved to dissemination boards of nation-wide bourses and want to migrate to such exchanges but not getting the NoC from non-operational exchanges, Sebi said that in such cases, exclusively listed companies which were filing returns for the last two financial years with their respective Registrar of Companies (RoC) may be treated as a compliant firm.
Besides, the requirement of No Objection Certificate (NoC) or any other documents may not be insisted upon by the nationwide exchange which is providing the listing platform, it added.
For the listing purpose, the company would have to obtain compliance certification from any independent professionals. The nationwide stock exchanges would also have to carry out independent verification for ensuring the compliance of the requirements.
All the promoters and directors of such companies, who have failed to provide the trading platform or exit to its shareholders, even after the extended time of 18 months will have to undergo stricter scrutiny for their any future association with securities market.
Sebi asked nationwide stock exchange to have a dedicated cell to process the application of exclusively listed companies of non-operational or exited bourses.
The applications of these companies for compliance with this circular would be disposed off as early as possible but not later than two months from the date of receipt of the application.
Until such listing, these companies would continue to remain in the dissemination boards of the nationwide stock exchanges.
As per the norms, exclusively listed companies which fail to obtain listing in any other nation-wide stock exchange will cease to be a listed firm and will be moved to the dissemination board by the existing stock exchange.
In May 2014, Sebi had asked stock exchanges to facilitate in a time-bound manner the process for listing of companies that are currently trading on non-compliant bourses.
