Description

SEBI defers the December 15, 2025 deadline for Phase III implementation of nomination facilities revamp to a future date to be notified separately, due to operational difficulties and system development requirements.

Summary

SEBI has deferred the timeline for implementing Phase III of the Nomination Circular (originally scheduled for December 15, 2025) to a future date to be notified separately. This deferment follows representations from various stakeholders regarding operational difficulties and the need for additional time to complete system developments and process changes required for implementation.

Key Points

  • Phase III implementation deadline of December 15, 2025 has been deferred indefinitely
  • New implementation date will be notified separately by SEBI
  • Deferment granted due to operational difficulties expressed by depositories, depository participants and industry associations
  • Stakeholders need additional time for system developments and process changes
  • All other provisions in the January 10, 2025, February 28, 2025 and July 30, 2025 circulars remain unchanged
  • Circular comes into force with immediate effect

Regulatory Changes

The circular modifies the implementation timeline previously established through a series of circulars:

  1. Original Circular (January 10, 2025): Introduced revised and revamped nomination facilities in the Indian Securities Market
  2. First Amendment (February 28, 2025): Implemented phased approach - Phase II (June 01, 2025) and Phase III (September 01, 2025)
  3. Second Amendment (July 30, 2025): Further deferred Phase II to August 08, 2025 and Phase III to December 15, 2025
  4. Current Amendment (December 11, 2025): Defers Phase III from December 15, 2025 to a future date to be notified

No substantive changes to the nomination requirements themselves - only timeline adjustments.

Compliance Requirements

Applicable to:

  • Asset Management Companies (AMCs) of Mutual Funds
  • Registrars to an issue and Share Transfer Agents (RTAs)
  • Association of Mutual Funds in India (AMFI)
  • Recognized Depositories
  • Registered Depository Participants

Current Status:

  • Entities are granted additional time beyond December 15, 2025 for Phase III implementation
  • Continue system development and process changes preparation
  • Await notification of new implementation date from SEBI
  • Maintain compliance with other provisions of the nomination circulars that remain in effect

Important Dates

  • December 11, 2025: Circular issued and came into force with immediate effect
  • December 15, 2025: Original Phase III deadline (now deferred)
  • To be notified: New Phase III implementation date

Historical Timeline:

  • January 10, 2025: Original nomination circular issued
  • February 28, 2025: Phased implementation announced
  • July 30, 2025: Phase II and III deadlines extended
  • December 11, 2025: Phase III deadline deferred indefinitely

Impact Assessment

Operational Impact:

  • Provides relief to market intermediaries facing technical and operational challenges
  • Allows additional time for system development and testing
  • Reduces risk of implementation failures or disruptions
  • Enables better coordination among depositories, depository participants and AMCs

Market Impact:

  • Low immediate market impact as this is an administrative/compliance timeline adjustment
  • Does not affect trading, settlement or investor transactions
  • Benefits investor protection objectives by ensuring proper implementation readiness

Compliance Impact:

  • Entities must continue preparation efforts for eventual Phase III implementation
  • No relaxation of requirements already implemented under previous phases
  • Stakeholders should monitor SEBI communications for announcement of new deadline

Investor Impact:

  • Neutral to positive for investors as it ensures robust implementation when launched
  • Nomination facility improvements will be delayed but quality of implementation prioritized

Impact Justification

Medium importance as it provides relief to AMCs, RTAs, depositories and depository participants by deferring Phase III implementation deadline indefinitely. No immediate action required but entities should continue preparation for eventual implementation.