The board of the Securities and Exchange Board of India (Sebi) on Friday decided to simplify and standardise the process for transferring securities held in the name of deceased investors to their legal heirs and claimants. It also created a new category of claimants for securities valued at not more than Rs 10,000 per scrip in physical form and not above Rs 30,000 in demat form.
Key Decisions by Sebi Board
The regulatory agency doubled the small-value claim amount to Rs 10 lakh per scrip for physical shares and Rs 30 lakh for demat shares. Additionally, the Sebi board allowed the re-introduction of the open market share buyback process that uses the stock exchange mechanism. This process was withdrawn a few years ago due to taxation issues, Sebi officials said.
Other Measures
The Sebi board also made it easier for fund houses to avail of intra-day borrowing to bridge liquidity mismatches. To enhance transparency among Sebi employees, the board approved a new Code of Conduct for Members of Sebi and amendments to the Sebi (Employees’ Service) Regulations, 2001, chairman Tuhin Kanta Pandey said.
The regulatory body’s top decision-making body approved measures to reduce procedural requirements and streamline the transmission process. Since the transmission is into a demat account, which requires a PAN for opening, the requirement to submit a PAN was removed. The mandatory requirement of obtaining probate of a will has been done away with, in line with recent amendments to succession laws.
The regulator also stated that from now on, a combined affidavit-cum-no objection certificate (NOC) will be required instead of separate affidavits and NOCs. It also allowed death certificates (DCs) carrying a QR code for this process, in addition to original or attested copies of DCs.
Buy-Back Process
Sebi decided to re-introduce open market buy-back through the stock exchange mechanism. It reviewed the buy-back processes post the revision in taxation framework and suggestions from stakeholders, with the objective of providing greater flexibility in undertaking buy-backs, reducing procedural complexity, and strengthening investor protection, the release said.
Chairman Pandey clarified that the regulator is not considering any proposal to allow self-listing, meaning allowing a stock exchange or its group company to list on its own bourse. In India, BSE is listed and traded only on NSE.
