| On request of several of our participants, we are postponing the workshop to the 28th of July, 2023, Friday, 4pm-7pm. Register now at : https://forms.gle/emHhuy6rNdhfCtbo7 |
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Vinod Kothari and Nitu Poddar (corplaw@vinodkothari.com)
– Updated February 02, 2024
Come June 1, 2024, top 100 listed companies, and thereafter, effective from December 1, 2024 top 250 listed companies, will have to mandatorily respond to market rumours, and cannot keep a policy of maintaining their own silence. What is the intent and scope of this requirement? Does this requirement expect companies to scan through more than 100000 mainstream media publications, and news channels and innumerable investor influencers, keep searching for the written or spoken word about the company, and then keep responding to all the din about the company? Or, the intent is just to ensure that a false market in the company’s securities is not being created or propped up by the company’s silence? And if the company is to respond to rumours, how and where does it respond?
These are some very pertinent questions bothering the larger of the listed entities. We are trying to address some of these questions below.
Read more →– Palak Jaiswani | corplaw@vinodkothari.com
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Identification as a “senior management person” brings information needs as well as obligations
– Pammy Jaiswal and Mahak Agarwal
The concept of Senior Management ( herein, ‘SM’, and senior management person or personnel as ‘SMP’ or ‘SMPs’) was not there under the regime of the Companies Act, 1956 and was first introduced under Section 178 of the Companies Act, 2013 (Act, 2013). The law requires the Nomination and Remuneration Committee to get into compensation policies of SMPs. The definition under the Listing Regulations has, over time, been aligned with that under the Act, 2013. These definitions have been around for almost 10 years now, and therefore, largely seem to have settled.
However, the LODR (2nd Amendment) Regulations[1] have introduced several new information requirements and obligations pertaining to SMPs, which has given rise to the need for relooking at the said position from a fresh perspective.
Read more →Kaushal Shah, Executive | kaushal@vinodkothari.com
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Kaushal Shah, Executive | kaushal@vinodkothari.com
In order to promote transparency and safeguard the interests of unitholders, SEBI recognizes the importance of streamlined governance practices for Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs). With the existence of 5 registered REITs and 21 InvITs, SEBI aims to establish effective mechanisms that ensure the flow of accurate information and provide protection to unitholders. This article explores the significance of streamlined governance practices in the REIT and InvIT sectors, highlighting SEBI’s efforts in fostering transparency and accountability.
Based on various representations received on the applicability of Corporate Governance (‘CG’) norms on ‘REITs and InvITs, SEBI in its Board meeting held on December 20, 2022, approved the introduction of CG-related provisions in SEBI (Real Estate Investment Trust) Regulations, 2014 (‘REITs Regulations’)[1] and SEBI (Infrastructure Investment Trust) Regulations, 2014, (‘InvITs Regulations’)[2] vide notification dated February 14, 2023. SEBI harmonized the requirements with SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, (‘LODR/ Listing regulations’) in relation to following areas, modified considering the structure of REITs and InvITs:
Read more →-Anushka Vohra | corplaw@vinodkothari.com
Companies often enter into various agreements with third parties, which may / may not be in the normal course of business and for which approval of shareholders is not mandated by law. Likewise, the promoters, directors of companies may enter into various agreements with third parties, to which the company is not a party. Such agreements may have the impact on control / management of the company. This becomes crucial in case of companies where public interest is involved. SEBI has vide SEBI (Listing Obligations and Disclosure Requirements) (Second Amendment) Regulations, 2023 (‘Amendment’) inter-alia inserted Reg. 30A and clause 5A of Para A Part A to Sch. III (Amended Regulation) which requires disclosure of certain agreements to the stock exchange(s) and in the annual report of the listed entity, which may have an impact on the control / management of the listed entity or imposes restriction / creates any liability on the listed entity.
There is an existing requirement of disclosing agreements viz. shareholder agreements, JV agreements, family settlement agreements, which are not in the normal course of business and to the extent that they impact the management and control of the listed entity, to the stock exchange(s). With the insertion of the aforesaid regulations, the extent of disclosure has quite largely increased. Obligation has been cast on several people to disclose to the listed entity, agreements that they have entered into- either among themselves or with third parties, which may (i) impact the control and management of the listed entity; (ii) impose restriction / create any liability on the listed entity.
This brings us to several questions on what agreements are required to be disclosed? How will the agreements that otherwise warrant confidentiality, be disclosed to the stock exchange(s)? In this article, we shall be discussing about the extended scope of disclosure w.r.t. agreements.
Read more →– Team Corplaw | corplaw@vinodkothari.com
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– Team Corplaw | corplaw@vinodkothari.com
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Read our other resources on LODR Second Amendment Regulations, 2023
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