Issuance of Securities in dematerialized form in case of Investor Service Requests
Summary
The circular mandates that listed companies issue securities in dematerialized form only for specified investor service requests. It requires RTAs and issuers to process these requests by issuing a Letter of Confirmation valid for 120 days for dematerialization. If the demat request is not submitted within this period, the securities are credited to the company's Suspense Escrow Demat Account.
Text
listed companies shall henceforth issue the securities in dematerialized form only... while processing the following service request: Issue of duplicate securities certificate; Claim from Unclaimed Suspense Account; Renewal / Exchange of securities certificate; Endorsement; Sub-division / Splitting of securities certificate; Consolidation of securities certificates/folios; Transmission; Transposition.
The securities holder/claimant shall submit duly filled up Form ISR-4... along with the documents / details specified therein. For item nos. iii to viii in paragraph 1 above, the RTA / Issuer Companies shall obtain the original securities certificate(s) for processing of service requests.
The RTA / Issuer Companies shall verify and process the service requests and thereafter issue a ‘Letter of confirmation’ in lieu of physical securities certificate(s), to the securities holder/claimant within 30 days of its receipt of such request after removing objections, if any.
The ‘Letter of Confirmation’ shall be valid for a period of 120 days from the date of its issuance, within which the securities holder/claimant shall make a request to the Depository Participant for dematerializing the said securities.
The RTA / Issuer Companies shall issue a reminder after the end of 45 days and 90 days from the date of issuance of Letter of Confirmation, informing the securities holder/claimant to submit the demat request as above, in case no such request has been received by the RTA / Issuer Company.
In case the securities holder/claimant fails to submit the demat request within the aforesaid period, RTA / Issuer Companies shall credit the securities to the Suspense Escrow Demat Account of the Company.
The common norms stipulated in SEBI/HO/MIRSD/MIRSD_RTAMB/P/CIR/2021/655 dated November 03, 2021 and SEBI/HO/MIRSD/MIRSD_RTAMB/P/CIR/2021/687 dated December 14, 2021 shall be applicable for all service requests listed above.
Stock Exchanges and Depositories are advised to: a) make necessary amendments to the relevant bye-laws, rules and regulations, operational instructions, as the case may be, for the implementation of the above circular; and b) bring the provisions of this circular to the notice of their constituents and also disseminate the same on the website.
This circular is being 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 read with Regulation 101 of SEBI (Listing Obligations and Disclosure Requirements), 2015.
The Circular shall come into force with immediate effect.
After verifying and processing the request, the RTA / Issuer Companies shall intimate the securities holder/claimant about its execution / issuance of new certificate as may be applicable, by way of issuing Letter of Confirmation (“letter”) (Format at Annexure B) in lieu of Share certificate/s provided by such securities holder/claimant.
The letter shall be sent by the RTA / Issuer Companies through Registered / Speed Post to the securities holder/claimant. Additionally, the RTA/Issuer Companies may send such letter through e-mail with e-sign and / or digital signature.
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Source: SecMarx — Issuance of Securities in dematerialized form in case of Investor Service Requests. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.