Clarification on Trading Rules and shareholding in dematerialized mode
Summary
This circular clarifies that government holding in the non-promoter category may be excluded when computing the minimum 50% shareholding requirement in dematerialized form. It advises stock exchanges to implement this decision by updating systems, amending bye-laws, and notifying member brokers. The directive is issued under Section 11(1) of the SEBI Act, 1992, to protect investor interests.
Text
It is clarified that while computing the requirement of minimum 50% shareholding of non-promoters in demat form in a company, the government holding in non promoter category may be excluded.
The Stock Exchanges are advised to put in place adequate systems, issue guidelines, make necessary amendments to bye-laws, rules and regulations, bring provisions to notice of member brokers, disseminate on website, and communicate implementation status in Monthly Development Report.
This circular is issued in exercise of powers conferred by sub-section (1) of Section 11 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.
Source: SecMarx — Clarification on Trading Rules and shareholding in dematerialized mode. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.