The Securities and Exchange Board of India (“SEBI”) has implemented key recommendations from the Expert Committee established to review the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“LODR Regulations”). These amendments, aimed at facilitating ease of doing business for listed entities, were approved by the SEBI Board and published in the Gazette of India on December 13, 2024.
To bring these changes into effect, SEBI issued a circular dated December 31, 2024, detailing amendments and implementation mechanisms. Below are the key highlights:
1. Integrated Filing System
A major reform is the introduction of Integrated Filing under Regulation 10(1A) of the LODR Regulations. This unified approach simplifies compliance by combining governance and financial filings.
Governance Filings: Include investor grievance statements and corporate governance reports.
Financial Filings: Cover related party transactions (RPTs), financial results, and statements of deviation/variation.
Timelines for Integrated Filing:
The filing timelines under the new system are:
Integrated Filing (Governance): Within 30 days from the end of the quarter.
Integrated Filing (Financial):
· Within 45 days from the end of each quarter (except the last quarter).
· Within 60 days from the end of the last quarter and the financial year.
2. Secretarial Auditor Guidelines
Only Peer-Reviewed Company Secretaries meeting specific eligibility criteria can be appointed.
Secretarial auditors are restricted from providing services such as internal audits, compliance system design, and investment advisory services to ensure impartiality.
3. Enhanced Disclosure Requirements
Employee Benefit Schemes: Scheme documents must be disclosed on the entity’s website after shareholder approval, with provisions for board-approved redactions.
Tax Litigations: Quarterly updates on tax disputes must now be disclosed, applying materiality thresholds.
4. Updated Timelines for Material Event Disclosures
SEBI specifies distinct timelines for disclosing material events, categorized by whether they originate within or outside the listed entity.
5. System-Driven Disclosures
Processes for automated disclosures, such as shareholding patterns and rating changes, have been outlined for stock exchanges and depositories to enhance accuracy and transparency.
Conclusion
The SEBI circular introduces significant reforms to streamline compliance processes, enhance transparency, and reduce the administrative burden on listed entities. By aligning with global standards and fostering a business-friendly environment, these changes are poised to improve governance and promote ease of doing business in India.
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