Archive for the ‘Stock Exchanges’ Category


CIRCULAR, CIR/MRD/DSA/14/2012, dated May 30, 2012

To,

The Managing Directors / Chief Executive Officers/

Officiating Executive Directors of all the Stock Exchanges.

1. SEBI vide circular dated December 29, 2008 issued guidelines in respect of exit option to stock exchanges. The exit policy of aforesaid exchanges has been reviewed by the Board and the said Circular stands revised/modified to the extent as under.

2. Process of De-recognition and Exit

2.1 Exchanges may seek exit through voluntary surrender of recognition.

2.2 Stock exchanges where the annual trading turnover on its own platform is less than Rs 1000 Crore can apply to SEBI for voluntary surrender of recognition and exit, at any time before the expiry of two years from the date of issuance of this Circular.

2.3 If the stock exchange is not able to achieve the prescribed turnover of Rs 1000 Crores on continuous basis or does not apply for voluntary surrender of recognition and exit before the expiry of two years from the date of this Circular, SEBI shall proceed with compulsory de-recognition and exit of such stock exchanges, in terms of the conditions as may be specified by SEBI.

2.4 Stock Exchanges which are already de-recognised as on date, shall make an application for exit within two months from the date of this circular. Upon failure to do so, the de-recognized exchange shall be subject to compulsory exit process.

3. With regard to exit option to shareholders of exclusively listed companies, on stock exchanges seeking de-recognition and/ or exit and de-recognised stock exchanges, the following process should be followed by the exclusively listed companies. Such an exchange shall monitor the process given below until its exit:

3.1 Exclusively listed companies shall list on any other recognized stock exchange. Such other recognized stock exchanges may facilitate the listing of exclusively listed companies, and, if required, carry out changes to their listing eligibility criteria, in the interest of investors. Stock exchanges may have differential listing criteria for such exclusively listed companies in respect of following criteria viz, Market Capitalization, Dividend paying track record, profitability, and paid-up capital. In this regard, the stock exchanges shall issue the differential listing eligibility criteria for such exclusively listed companies.

3.2 The exclusively listed companies, which fail to obtain listing on any other stock exchange, will cease to be a listed company and will be moved to the dissemination board by the exiting stock exchange. Therefore, in the interest of investors of exclusively listed companies, a mechanism of dissemination board will be set-up by stock exchanges having nationwide trading terminals.

3.3 Dissemination Board:

Under this mechanism, a willing buyer and seller will be given an opportunity to disseminate their offers using the services of brokers of stock exchanges hosting dissemination board. The mechanism of dissemination board shall be given wide publicity for the benefit of the investors of exclusively listed companies. Every stock exchange hosting a dissemination board shall clearly bring out the guidelines in respect of the Dissemination Board on its website.

Features of Dissemination Board:

i. Exiting Stock Exchanges will be required to enter into an agreement with at least one of the stock exchanges with nationwide trading terminals providing the Dissemination Board. The exiting stock exchange shall pay a one-time fee for the arrangement as may be decided in the agreement. The fee may be based on number of companies moving on to the dissemination board, number of public shareholders in those companies, their paid up capital etc.

ii. Exchanges having nationwide trading terminal will not have listing agreement with these companies. However, information received from such companies will be disseminated.

iii. The buyers/ sellers will be required to register with broker of the exchange where the dissemination board is set up.

iv. No contract note is required to be issued for such transactions.

v. The matched trades will not be settled through the stock exchange/Clearing Corporation mechanism and hence, there will be no recourse to the Settlement/ Trade Guarantee Fund and Investor Protection Fund of the Exchange for the trades on Dissemination Board

vi. The exiting Stock Exchange as well as exchange providing dissemination board will give wide publicity about the dissemination board in one leading national daily and one local daily.

The stock exchanges hosting dissemination board shall issue uniform operational guidelines for the dissemination board.

4. Members of Stock Exchanges to continue trading through Subsidiary

4.1. In case of de-recognition of a stock exchange, the exchange may provide trading opportunity to their trading members to trade on stock exchanges having nationwide terminals through their subsidiary company, which will function as normal broking entity in terms of SEBI circular dated December 29, 2008. In case of de-recognition, subsidiary company shall continue to function as broking entities in compliance of, inter alia, the provisions of the SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992.

4.2. In case of de-recognition, the MoU mechanism, if any, between a stock exchange not having nationwide trading terminal and a stock exchange having nationwide trading terminal, shall be discontinued and in such cases the trading members of erstwhile stock exchanges will gain access to exchanges having nationwide terminals through membership of the existing subsidiary company.

5. Treatment of the Assets of de-recognized exchange

5.1. De-recognized stock exchange (voluntarily de-recognized or compulsorily de-recognized) is permitted to distribute its assets subject to certain conditions as laid down in this circular, as well as other guidelines that may be issued by SEBI, Government(s), or any other statutory authority from time to time.

5.2. For the purpose of valuation of the assets of the stock exchange, a valuation agency shall be appointed by SEBI.

5.3. The quantum of assets for distribution will be available after payment of statutory dues including income tax, transfer of funds as specified in para 6.1, payment of dues as specified in para 6.2, refund of deposit (refundable) to the stock brokers including their initial contribution/ deposit to Settlement Guarantee Fund / Trade Guarantee Fund (SGF/ TGF), and contribution to SEBI as specified in para 5.4. However, the remainder of SGF/ TGF after refunding to stock broker as mentioned above shall be considered for the purpose of valuation of the assets of the exchange.

5.4. In case of de-recognition and exit, the stock exchange shall contribute upto 20% of its assets (after tax) towards SEBI Investor Protection and Education Fund (IPEF) for investor protection and in order to cover future liabilities, if any. The contribution may be decided by SEBI taking into account, inter alia, the governance standards of the stock exchange and estimation of future liabilities.

5.5. All stock exchanges including de-recognised stock exchanges shall not alienate any assets of the exchange without taking prior approval of SEBI.

6. Other Conditions:

6.1. The exchange shall transfer Investor Protection Fund, Investor Services Fund, 1% security deposit available with them to the SEBI IPEF. The 1% security deposit shall subsequently be returned to the issuer company in due course on satisfying the prescribed conditions.

6.2. The exchange shall pay following dues to SEBI:

6.2.1. The dues outstanding to SEBI including 10% of the listing fee and the annual regulatory fee.

6.2.2. The outstanding registration fees of brokers/trading members of such de-recognised stock exchanges as specified in the SEBI (Stock Brokers and Sub Brokers) Regulations, 1992 till the date of such de-recognition.

6.2.2.1. Dues of the brokers to SEBI shall be recovered by the exchange out of the brokers’ deposits / capital / share of sale proceeds /winding up proceeds / dividend payable, etc. available with the exchange.

6.2.2.2. The exchange will be liable to make good any shortfall in collection of dues of the brokers to SEBI.

6.3. In case the stock exchange, after de-recognition, continues as a corporate entity under the Companies Act, 1956, it shall not use the expression ‘stock exchange’ or any variant in its name or in its subsidiaries name so as to avoid any representation of present or past affiliation with the stock exchange. The subsidiaries of de-recognised stock exchanges may continue to function as any other normal broking entity, managed by its own board, with a suitable change of name so as to avoid any representation of any present or past affiliation with the stock exchange.

6.4. Sale/distribution/transfer of assets/winding up of such exchanges/companies shall be subject to the applicable laws in force.

6.5. The stock exchange shall set aside sufficient funds in order to provide for settlement of any claims, pertaining to pending arbitration cases, arbitration awards, not implemented, if any, liabilities/claims of contingent nature, if any, and unresolved investors complaints/grievances lying with the exchange.

7. SEBI may allow de-recognition and/ or exit to stock exchanges subject to additional conditions as may be decided by SEBI in the interest of trade or in the public interest including securities market.

8. In case of stock exchange seeking exit, through voluntary surrender of recognition or after being compulsorily de-recognized by SEBI, an appropriate order shall be passed by SEBI.

9. Applicability

This circular shall apply to:

(i) Recognized stock exchanges

(ii) Stock exchanges that stand de-recognised as on date of this circular

(iii) Stock exchanges that have applied for derecognition/ exit as on the date of this circular

10. This circular is issued in exercise of powers conferred under Section 11 (1) and 11(2) (j) of the Securities and Exchange Board of India Act, 1992, read with Section 5 of the Securities Contracts (Regulation) Act, 1956, to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.

11. This circular is available on SEBI website at www.sebi.gov.in.

Yours faithfully,

Rajesh Kumar D

Deputy General Manager

Tel. No. 2644 9242

Email: rajeshkd@sebi.gov.in

Click here to download the complete text of the above Circular in PDF Format- CIRCULAR, CIR/MRD/DSA/14/2012, dated May 30, 2012.

Source: Securities and Exchange Board of India.

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Circular, CIR/DNPD/ 2 /2012, dated May 23, 2012

To

Managing Director/ Chief Executive Officer

Recognized Stock Exchanges

1. SEBI Circular No. CIR/DNPD/5/2010 dated July 30, 2010, inter alia, provides for position limits applicable for USD:INR derivatives contracts wherein Annexure II, para-3 of page 5 stipulates the norms applicable to Trading Member (Banks).

2. Your attention is drawn to RBI Circular No: RBI/2011-12/569 dated May 21, 2012 on ‘Risk Management and Inter-bank dealings’. The Circular, inter alia, revised norms on position limits for Authorized Dealers Category – I (AD Category – I) banks.

3. In light of the above, Annexure II, para-3 of page 5 of the above stated SEBI Circular, stands modified as under:

“Gross open positions of the bank across all contracts (both futures and options contracts) not to exceed 15% of the total open interest or USD 100 million whichever is lower”.

4. This circular is issued in exercise of the powers conferred under Section 11(1) of the Securities and Exchange Board of India Act 1992, read with Section 10 of the Securities Contracts (Regulation) Act, 1956 to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.

5. This circular is available on SEBI website at http://www.sebi.gov.in under the category “Derivatives- Circulars”.

Yours faithfully,

Shashi Kumar

Deputy General Manager

Derivatives and New Products Department

022-2644-9203

shashikumarv@sebi.gov.in

Click here to download the complete text of the above Circular in PDF Format- Circular, CIR/DNPD/ 2 /2012, dated May 23, 2012.

Source: Securities and Exchange Board of India.


CIR/MRD/DP/ 13 /2012 dated April 23, 2012

To,

All Stock Exchanges

Dear Sir / Madam,

1. It is observed from the information provided by the depositories that the companies listed in Annexure ‘A’ have established connectivity with both the depositories.

2. The stock exchanges may consider shifting the trading in these securities to normal Rolling Settlement subject to the following:

a) At least 50% of other than promoter holdings as per clause 35 of Listing Agreement are in dematerialized mode before shifting the trading in the securities of the company from TFTS to normal Rolling Settlement. For this purpose, the listed companies shall obtain a certificate from its Registrar and Transfer Agent (RTA) and submit the same to the stock exchange/s. However, if an issuer-company does not have a separate RTA, it may obtain a certificate in this regard from a practicing company Secretary/Chartered Accountant and submit the same to the stock exchange/s.

b) There are no other grounds/reasons for continuation of the trading in TFTS.

3. The Stock Exchanges are advised to report to SEBI, the action taken in this regard in the Monthly/Quarterly Development Report.

Yours faithfully,


Harini Balali

Deputy General Manager

022-26449372

email: harinib@sebi.gov.in

Annexure A

Sr.

No.

Name of the Company ISIN
1. Southern Latex Limited INE410M01018
2. Ishan Dyes And Chemicals Limited INE561M01018
3. SDFC Finance Limited INE592M01013
4. Anuvin Industries Limited INE216I01017
5. Kothari World Finance Limited INE988F01017
6. Gujarat Narmada Flyash Company Limited INE955G01014
7. Palco Metals Limited INE239L01013
8. Duncan International (India) Limited INE157M01015
9. New India Investment Corporation Limited INE178M01011
10. Elite Leasings Limited INE450M01014
11. Indian Bright Steel Company Limited INE566M01017
12. Globus Constructors & Developers Limited INE064L01015
13. Sun And Shine Worldwide Limited INE560F01014
14. Bio Whitegold Industries Limited INE307H01016
15. Lakshmi Automatic Loom Works Limited INE718M01014
16. ERP Soft Systems Limited INE308B01017
17. Global Land Masters Corporation Limited INE330B01011
18. Aashee Infotech Limited INE847M01011
19. Valuemart Retail Solutions Limited INE800F01014
20. Sulabh Engineers And Services Limited INE673M01011
21. Sheel International Limited INE895E01017
22. Inter Globe Finance Limited INE661M01016
23. Thanjavur Spinning Mill Limited INE715M01010
24. Kinetic Trust Limited INE674M01019
25. Greenline Tea And Exports Limited INE624M01014
26. Sharda Ispat Limited INE385M01012
27. Parikh Herbals Limited INE880M01012
28. Asia Pack Limited INE784M01016
29. Swadeshi Industries And Leasing Limited INE716M01018
30. Longview Tea Company Limited INE696E01019
31. P S Global Limited INE783M01018
32. Aptus Industries Limited INE899M01012
33. Gradiente Infotainment Limited INE361K01017

Click here to download the complete text of the above Circular in PDF Format- Establishment of Connectivity with both depositories NSDL and CDSL- Companies eligible for shifting from Trade for Trade Settlement (TFTS) to normal Rolling Settlement- Apr 23, 2012.

Source: Securities and Exchange Board of India.


CIRCULAR- CIR/IMD-DoF-1/11/2012- Dated April 16, 2012

To

All Stock Exchanges

Dear Sir / Madam,

1. With effect from June 2011, SEBI has launched a new web based centralized grievance system called SCORES for more efficient and transparent processing of complaints.

2. Vide circular No. CIR/OIAE/2/2011 dated June 3, 2011, SEBI has mandated all listed companies to have SCORES user id and password for processing complaints through the SCORES system.

3. In this regard, in addition to companies mentioned in the aforesaid circular, it is advised that companies which apply to the stock exchanges for listing of debt securities in accordance with SEBI (Issue and Listing of Debt Securities), 2008 are mandated to apply for authentication for SCORES when they file for approval for listing of debt securities.

4. The company may apply for SCORES authentication in the format as specified in the Annexure to the circular No. CIR/OIAE/2/2011 dated June 3, 2011. Once filled, the company shall scan the form and e-mail the same at scores@sebi.gov.in and send the hard copy to Office of Investor Assistance and Education (OIAE) Department, SEBI, SEBI Bhavan, Plot No.C4-A,’G’ Block, Bandra Kurla Complex, Bandra (East), Mumbai 400051.

5. A company shall use the same SCORES authentication for all subsequent issues of debt securities listed with any of the stock exchanges. Companies which have already obtained SCORES authentication from SEBI for issue of debt securities need not obtain the authentication again.

6. The Stock exchanges shall ensure that the company applying for listing of debt securities has SCORES authentication before granting of such approval to the company.

7. The stock exchanges are accordingly advised to bring the provisions of this circular to the notice of all the companies when they file for approval for listing of their debt securities on the stock exchange and disseminate the same on the stock exchange website.

8. This Circular is issued in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992 to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.

9. This Circular is available on SEBI website at www.sebi.gov.in under the categories “Legal Framework” and “Corporate debt market”.

Yours faithfully,

Maninder Cheema

Deputy General Manager

Investment Management Department

Tel No.022-26449754

Email id – maninderc@sebi.gov.in

Click here to download the complete text of the above Circular in PDF Format- Processing of investor complaints against companies applying for listing of debt securities in SEBI SCORES System.

Source: Securities and Exchange Board of India.


Amendments to the Equity Listing Agreement – Formats for Disclosure of Financial Results

CIRCULAR- CIR/CFD/DIL/4/2012- Dated April 16, 2012.

To

All Stock Exchanges

Dear Sir/Madam,

1. Ministry of Corporate Affairs vide Notification dated February 28, 2011 has revised the format for disclosure of Balance Sheet under Schedule VI of the Companies Act, 1956.

2. Pursuant to the same, it has been decided to carry out consequential amendments to Clause 41 of the Listing Agreement regarding interim disclosure of financial results by listed entities to the stock exchanges, which has been drawn from the format under Schedule VI of the Companies Act, 1956. Accordingly, the format for the said disclosure has been given in Annexure.

3. The above shall be applicable for financial year ended on March 31, 2012 for all filings made after the date of this circular.

4. The above listing conditions are specified in exercise of the powers conferred under Section 11 read with Section 11A of the Securities and Exchange Board of India Act, 1992. The said listing conditions should form part of the existing Listing Agreement of the stock exchange.

5. All stock exchanges are advised to ensure compliance with this circular and carry out the amendments in their Listing Agreement as per the Annexure to this circular.

6. This circular is available on SEBI website at www.sebi.gov.in under the categories “Legal Framework” and “Issues and Listing”.

Yours faithfully,

Sunil Kadam

General Manager

+91-22-26449630

sunilk@sebi.gov.in


Click here to Download Annexure- from Page 2 to Page 6.

Click here to download the complete text of the above Circular in PDF Format- Amendments to the Equity Listing Agreement- Formats for Disclosure of Financial Results.

Source: Securities and Exchange Board of India.