Description

BSE provides guidance on scenarios that cannot be considered for waiver or reduction of fines under SEBI LODR regulations.

Summary

BSE has issued guidance clarifying scenarios where waiver or reduction of fines will not be considered for commonly listed entities. The circular provides an illustrative list of non-acceptable scenarios for three key regulatory violations under SEBI LODR regulations.

Key Points

  • Specifies scenarios that do not qualify for waiver of fines under SEBI LODR regulations
  • Covers three major compliance areas: company secretary appointment, investor complaint reporting, and board composition
  • Emphasizes that certain common excuses will not be accepted for waiver applications

Regulatory Changes

No new regulatory changes introduced. This circular clarifies existing waiver application processing standards.

Compliance Requirements

Regulation 6(1) - Company Secretary Appointment (₹1,000/day fine):

  • Must appoint qualified company secretary as compliance officer within three months of vacancy
  • Must provide documentary evidence of efforts to appoint new CS within prescribed timeframe
  • Must specify valid reasons for any delayed compliance in waiver applications

Regulation 13(3) - Shareholder Complaints Statement (₹1,000/day fine):

  • Submit quarterly statement on investor complaints within prescribed period
  • Cannot cite non-receipt of data from RTA/Depository as excuse
  • Must ensure compliance despite officer resignations or unavailability

Regulation 17(1) - Board Composition (₹5,000/day fine):

  • Maintain optimum combination of executive and non-executive directors
  • Ensure at least one woman director (top 1000 entities need independent woman director)
  • At least 50% non-executive directors required
  • Top 2000 entities must have minimum six directors

Important Dates

  • Three-month deadline for company secretary appointment after vacancy
  • Quarterly submission deadlines for investor complaint statements

Impact Assessment

Market Impact: Medium - Affects procedural compliance rather than trading operations

Operational Impact: High for non-compliant entities - Stricter enforcement of existing regulations with reduced scope for waivers

Compliance Impact: High - Listed entities must ensure robust compliance processes and cannot rely on common excuses for delays

Impact Justification

Important compliance guidance for listed entities regarding waiver applications, but affects procedural matters rather than market operations