Exchange prospective on listing regulation

NSE - Confidential1

Exchange Perspective on

Listing Regulations

NSE - Confidential2

INDEXSr. No Particulars

1 Listing Agreement to be signed

2 Duties and Obligation of the Exchange

3 Electronic Filing

4 Regulation wise monitoring by Exchange

5 Impact of LA turning into LR – Penal Provisions & Enforcement

NSE - Confidential3

Listing Agreement to be signed All listed entities shall execute a fresh listing agreement with the SEs within

six months from date of notification of notification i.e. by March 2, 2016.

Company may execute this agreement under the power of old Board Resolution or pass a new resolution. If new resolution required, it can be done by circular resolution.

Listing Regulation will be applicable w.e.f. December 1, 2015 to all listed entities, irrespective of whether Listing Agreement is signed or not.

Language of Listing Agreement is finalized by SEBI. Exchange will sent the Listing Agreement to all listed entities for execution well before December 01, 2015.

NSE - Confidential4

Duties and Obligation of the Exchange Chapter X of Listing Regulation deals with duties and obligation of the stock exchanges.

Duties and Obligation of SEs prescribed in LR:i. All intimation, information, filings, reports, statements, documents or any other

submissions under the Regulation from the listed entities / other person to be disseminated on Exchange website.

ii. Exchange and Depositories to coordinately act to give effect to order on freezing / unfreezing / lock –in of securities.

iii. Role of Exchange in examining Scheme of Arrangement is clearly defined with prescribed turnaround time.

iv. Validity of ‘NOC’ given by the Exchange is 6 months.

v. To facilitate redressal of complaints of listed securities holders from time to time.

Duties and Obligation of the Exchangevi. To monitor the compliance with provisions of listing regulations and

take appropriate actions for non-compliance.

vii. To monitor adequacy and accuracy of disclosures made and take appropriate actions for non-compliance.

viii. To submit the report to SEBI on the outcome of monitoring compliance.

ix. In case of default in compliance, exchange has to initiate appropriate -remedial / penal action.

x. To receive quarterly corporate governance report and examine its adequacy.

NSE - Confidential5

NSE - Confidential6

Electronic Filing Electronic filing is made mandatory. The listed entity shall put in place

infrastructure to make submission through Exchange electronic platform.

NSE’s electronic filing platform ‘NEAPS’ which is already in use is being revamped to make it more user friendly.

The new modules are being introduced to ensure all submissions prescribed under the Regulations.

Register email id and mobile nos. to receive alters and reminders for compliance status.

Electronic Filing

NSE - Confidential7

Secured and authenticate

d mode

Quick dissemination

Immediate confirmation to

corporates

Quick retrieval of past filings

NSE - Confidential8

Regulation wise monitoring by ExchangeRegulation no. Description of filing Timeline

Reg. 7(3) Half yearly compliance certificate regarding maintaince of transfer facility(signed by CO & RTA)

within 1 month from end of half year.

Reg. 7(4) Change in RTA Within 24 hrs.

Reg. 13(3) Quarterly Investor compliant statement within 21 days from EOQ

Reg. 27(2) Quarterly Corporate Governance Report (signed by CO / CEO)

within 15 days of EOQ

Reg. 28(1) in-principal approval for issuing securities (other than Scheme)

Before issuance of securities

Reg. 29 Prior intimation of BM notice for considering financial results, Buy Back, Voluntary delisting, fund raising by further issuance, dividend, bonus, alteration in nature of securities.

2 working days and for financial results 5 days.

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Reg. 30 Disclosure of events / information within 24 hrs of occurrence of events / outcome of Board Meeting submitted within 30 min of the conclusion.

Reg. 31 (1) Shareholding Pattern Within 21 days from EOQ/ within 10 days from change exceeding 2% in capital.

Reg. 32 (1) Statement of deviation / variation Along with quarterly resultsReg. 33 (3) (a) Quarterly financial results along with LR Within 45 days EOQ

Reg. 33 (3) (d) Annual Results along with form A/B Within 60 days from end FY

Reg. 34 Annual Report within 21 working days of its approval / adoption at the AGM

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Reg. 40 (9) Half yearly Certificate from Practicing CS regarding transfer for shares with in 30 days of its lodgment

within 1 month from end of half year.

Reg. 42 Record Date / Book Closer At least 7 working days in advance

Reg. 43 Dividend per share basis Within 30 min of BMReg. 44 Voting results at shareholders meeting Within 48 hrs of conclusion

of shareholders meeting Reg. 45 Name Change of the company Prior apply to ROC for name

changeReg. 46 Company website Information to be updated

within 2 working days from date of such change.

Regulation wise monitoring by Exchange Reg. 30 – Disclosure of events / information:

4 (ii) - Policy determination materiality to be disclosed on website.

5 - contact details of authorise KMPs responsible for determining materiality of events and making disclosures to the SEs.

6 - Disclosures shall be submitted within 24 hrs of occurrence of events and outcome of Board Meeting submitted within 30 min of the conclusion.

7 - Submit disclosures updating material developments on regular basis.

8 – Disclosures submitted to the Exchange shall be hosted on company website for minimum period of 5 years.


Regulation wise monitoring by Exchange Reg. 30 – Disclosure of events / information:

9 – Disclosures regarding events / information w.r.t. material subsidiaries.

10 – Company shall provide specific and adequate reply to all queries raised by SE w.r.t. any events / information.

11- listed company may on its own initiative confirm or deny any reported event or information to Stock Exchange.



Regulation wise monitoring by ExchangeEvents disclosed without applying guideline for materiality - Para A Acquisitions, Scheme of Arrangements, Sale of unit / division/ subsidiary Issuance / forfeiture / buyback of securities / Revision of ratings Outcome of BM (within 30 min) Agreement which are binding and not normal course of business

(shareholder/ family settlement/ media co.) Change in Directors, KMPs, CO, RTA, Auditors CDR / One time settlement/ BIFR / Winding up petition Fraud/defaults by promoters / KMPs / arrest of promoters / KMPs. Notices / proceedings of shareholders meeting / Amendment to MoA –

AoA Schedule of Analyst / institutional investor meet / presentation


Regulation wise monitoring by ExchangeEvents to be disclosed by applying guideline for materiality - Para B Commencement of commercial production / postponement Change is general character / nature of business by arrangement Capacity addition / product launch Agreement which are binding and not normal course of business

(loan agreement as a borrower) Disruption of operations due to natural calamity force majeure events

(strike) Litigation/ dispute / regulatory action with impact Fraud/defaults by directors (other than KMPs) or employees ESOP / ESPS scheme / Allotment pursuant to ESOP Effect / impact of change in regulatory framework Withdrawal / cancellation / suspension of key licenses

Regulation wise monitoring by ExchangeReg. 30 – Disclosure of events / information: Exchange Monitoring

To monitor accuracy and adequacy of the disclosures.

To seek clarification / explanation in case of inaccuracy / inadequacy / delay in disclosures submission.

The listed entity is obliged to provide specific and adequate reply for all queries raised by the Exchange. All this can be in electronic means only .

The clarification / explanation sought and company reply will be disseminated.

Exchange to submit report to SEBI periodically on clarification sought etc.

Rumor or news verification will be a routine.


Regulation wise monitoring by Exchange Reg. 31 – Shareholding Pattern:

Timeline, accuracy check on shareholding pattern disclosures.

Disclosures under take over regulation and PIT regulation validated with shareholding pattern disclosures.

Change in promoter shareholding / change in promoters / name of promoters to be monitored.

The clarification / explanation sought from the company and company reply will be disseminated on the Exchange website.


Regulation wise monitoring by Exchange Reg. 32 – Statement of deviation / variation of issue proceeds:

Statement of deviation / variation should be submitted separately but along with financial results on quarterly basis.

Monitoring agency report for IPO / rights issue.

Timeline and non submission will be monitored.

Exchange will sought clarification / information for non submission of disclosures.

The disclosures will be disseminated on the Exchange website.


Regulation wise monitoring by Exchange Reg. 33 – Financial Results:

At least 5 days advance intimation of BM for consideration of results to be given to the Exchange.

Outcome of BM to be filed with exchange with in 30 min. of conclusion of BM

Company has to intimate time of commencement and conclusion of the meeting.

Company shall intimate regarding option to submit the consolidated results along with first quarter results.

Limited Review Report / Auditors report submitted along with results.

Form A / Form B submitted along with Annual Audited Results (stand alone / consolidated) NSE - Confidential18

Regulation wise monitoring by Exchange Schedule VIII – Manner of Review of Form B:

After preliminary scrutiny of Form B, the Exchange may seek explanation.

The Exchange will refer cases to SEBI which require further examination.

Exchange will display list of companies which have filed Form B.

SEBI (QARC) may direct for:

i. Rectification of modified opinion in subsequent FY, if impact of modified opinion is not significant

ii. Submission of revised pro-forma results incorporating the effect of modified opinion, if impact of modified opinion is significant and company explanation is un satisfactory.


Regulation wise monitoring by Exchange Reg. 34 – Annual Report

AR to be submitted within 21 working days of its approval / adoption at the AGM.

Non submission / delay in submission is non-compliance. Electronic filing will be facilitated.

The Exchange may monitor the disclosures given in annual report w.r.t. corporate governance requirement.

Reg. 35 – Information memorandum Information memorandum to be submitted as the manner specified by

SEBI. (no circular is issued yet)


Regulation wise monitoring by Exchange Reg. 37 – Draft Scheme of Arrangement

The Exchange will process the draft scheme of arrangement filed.

Company shall not file any scheme with court / Tribunal without obtaining observation / no-observation letter from the Exchanges and company shall place such letter before court /Tribunal.

The Exchange shall bring the observation / objection to the notice of Court / Tribunal.

No in-principle approval is required for securities to be issued pursuant to scheme, if “NOC” has been obtained from the exchange.


Implication of LA turning into LR Listing Agreement is like terms of listing

Non-compliance attract only penalty as per SOP circular dated September 30, 2013 and exchange bye-laws.

Listing Regulation is a subordinated legislation and therefore has statutory force. SEBI may exercise its power given in SEBI Act, 1992 such as:

Sec. 11 B – Power to issue directions. Sec. 11 C – Power to Investigation.Sec. 11D – Power to cease and desist proceedings.Sec. 15A - Penalty for failure to furnish information, return, etc.Sec. 15C - Penalty for failure to redress investors’ grievances Sec. 15 HB - Penalty for contravention where no separate penalty has been provided. Sec. 15I - Power to adjudicate.


Implication of LA turning into LREffectively, even not resolving investor complaint can attract adjudication and penalty as stated above.

Electronic filing to Stock Exchange is now mandatory and a statutory requirement.


Thank You


Law

Exchange prospective on listing regulation