Minimum information to be provided to the Audit Committee and Shareholders for approval of Related Party Transactions
Summary
This circular modifies the minimum information requirements for listed entities to provide to Audit Committees and Shareholders for Related Party Transaction (RPT) approvals. It introduces exemption thresholds where transactions below 1% of annual consolidated turnover or Rs. 10 Crore require reduced disclosures, while those under Rs. 1 Crore are fully exempt. The document specifies the exact data points that must be included in audit committee notices and shareholder explanatory statements.
Text
Section III-B of the Master Circular read with Para 7 of the SEBI Circular dated June 26, 2025 shall be modified as under.
The listed entity shall provide the audit committee with the information as specified in the Industry Standards on “Minimum information to be provided to the Audit Committee and Shareholders for approval of Related Party Transactions”, while placing any proposal for review and approval of an RPT.
if a transaction with a related party... do not exceed 1% of annual consolidated turnover of the listed entity as per the last audited financial statements of the listed entity or Rupees Ten Crore, whichever is lower, the listed entity shall provide ‘Minimum information to the Audit Committee for approval of Related Party Transactions’ specified in Annexure-13A of this circular.
the above requirements, shall not be applicable to transaction(s) with a related party... which does not exceed Rs. One Crore.
The notice being sent to the shareholders seeking approval for any RPT shall, in addition to the requirements under the Companies Act, 2013, include the information as part of the explanatory statement as specified in the Industry Standards...
if a transaction with a related party... do not exceed 1% of annual consolidated turnover of the listed entity as per the last audited financial statements of the listed entity or Rupees Ten Crore, whichever is lower, the listed entity shall provide ‘Minimum information to the Shareholders for approval of Related Party Transactions’ specified in Annexure-13A of this Circular.
the above requirements, shall not be applicable to transaction(s) with a related party... which does not exceed Rs. One Crore.
It is further clarified that the exemption threshold of Rupees One Crore as specified in Para 3(c) of the RPT Industry Standards shall continue to apply.
The listed entities, from the effective date of this Circular, shall follow the format as prescribed hereunder and RPT Industry Standards, as may be applicable, to ensure compliance with Part A and Part B of Section III-B of the Master Circular read with Regulation 23(2), (3) and (4) of LODR Regulations.
This circular shall come into effect immediately.
The Stock Exchanges are advised to bring the contents of this Circular to the notice of their listed entities.
The listed entity shall provide the following information, for review by the audit committee for approval of a proposed RPT: a. Type, material terms and particulars... b. Name of the related party... c. Tenure... d. Value... e. Percentage of turnover... f. Loan details... g. Justification... h. Valuation report... i. Counter-party percentage... j. Any other relevant info.
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Source: SecMarx — Minimum information to be provided to the Audit Committee and Shareholders for approval of Related Party Transactions. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.