On July 29, 2024, the Securities and Exchange Board of India (SEBI) introduced the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Third Amendment) Regulations, 2024. These amendments came into effect on July 30th, 2024, and have brought significant changes to the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2018.
Key Amendments:
Quarterly Disclosure of Shareholding Patterns
The 2024 Regulations have revised Regulation 21(1) to mandate that recognized stock exchanges and clearing corporations must disclose their shareholding patterns on their respective websites on a quarterly basis. This disclosure must adhere to the format specified for listed companies under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Previously, Regulation 21(1) required these entities to submit their shareholding patterns to SEBI within fifteen days from the end of each quarter in a format specified by the Board.
Changes in Core Settlement Guarantee Fund Committee
Regulation 29(2)(a) has been amended to relieve recognized stock exchanges and clearing corporations from the requirement to constitute a Core Settlement Guarantee Fund Committee within the Functional Committee. This change simplifies the governance structure for these entities, potentially streamlining their operational processes.
Amendments to Form A in Schedule I
Part III of Form A in Schedule I has been modified to omit the requirement for clearing corporations applying for recognition or renewal to provide details about rules for the direct election by clearing members on the Advisory Committee of the governing board. This amendment reduces the administrative burden on clearing corporations during the application process.
Revised Guidelines for Monitoring Shareholding Limits
Schedule II, Part G, Para 1(c) has been updated to ensure that listed stock exchanges follow the guidelines specified by SEBI from time to time for monitoring shareholding limits, instead of adhering to the Circular dated January 1, 2016. This change allows for more current and flexible oversight mechanisms.
Omission of Advisory Committee Election Provision
Para V of Part H in Schedule II has been amended to remove the provision for the selection of trading/clearing members on the Advisory Committee to the governing board. This omission reflects a shift towards a different approach in the constitution and operation of the Advisory Committee.
Conclusion
The Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Third Amendment) Regulations, 2024, bring significant changes to the disclosure requirements and governance structures for recognized stock exchanges and clearing corporations in India. These amendments, effective from July 30, 2024, aim to enhance transparency, streamline processes, and ensure more flexible and current oversight mechanisms. As SEBI continues to refine its regulations, these updates represent a crucial step in maintaining a robust and transparent financial market environment in India.
Comments