Streamlining the Process of Public Issues and redressal of Investor grievances
Summary
This circular modifies the March 2021 guidelines regarding the streamlining of public issues and investor grievance redressal. It introduces a new reporting format for Self Certified Syndicate Banks (SCSBs) to track ASBA application unblocking timelines. Additionally, it establishes specific conditions for SCSBs to claim processing fees and mandates SMS alerts or invoice notifications for investors. This section provides the formal application format for State Co-operative Banks (SCSBs) to claim processing fees from Merchant Bankers within 30 days of Basis of Allotment. It mandates SCSBs to confirm the completion of ASBA unblocking and the payment of applicable investor compensation as per SEBI circulars. The document includes detailed schedules for reporting specific types of compensation related to delayed unblocking or incorrect blocking of funds. Schedule IV provides a tabular format for issuers to record details regarding compensation for delayed unblocking of ASBA applications. Annexure II specifies the mandatory content for SMS notifications sent to applicants during blocking, debit, and unblocking events. The document also outlines the specific data fields required for UPI
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The Circular provided a mechanism of compensation to investors for delay in unblocking of application amounts by SCSBs and has prescribed certain compliance and reporting standards to be adopted by SCSBs.
SCSBs shall submit the Annexure IV of the March’21 Circular in the format prescribed in Annexure IV of this circular.
It is reiterated that the SCSBs shall continue to compensate the investors for delays in unblocking of application amounts as per the compensation clause provided in the March’21 Circular.
The compensation prescribed in the March’21 Circular shall be applicable to all ASBA applications processed by the SCSBs.
To claim the processing fee, SCSBs shall make an application to the Merchant Bankers in the format prescribed in Annexure I of this circular... subject to the following conditions:
The application shall be made no later than 30 days from the finalization of basis of allotment by Registrar to the Issue.
The SCSBs shall make the application only after (i) unblocking of application amounts for each application received by such SCSB has been fully completed; (ii) applicable compensation relating to investor complaints has been paid by the SCSB.
The SCSBs shall continue to be responsible to provide information requested by the Merchant Bankers/ Registrar to the Issue/ Issuer and also remain liable to pay compensation applicable as per the Circular... for delays in unblocking of application amounts after the processing fee has been claimed by the SCSBs.
Needless to state that SCSBs are liable to face appropriate action under Securities Laws for non-compliance with the requirements of this circular.
Accordingly, it has been decided that the SCSBs/UPI Apps eligible for Public Issues shall send SMS Alerts to Investors for all ASBA applications and may also provide the Invoice in the Inbox as an additional feature to verify the UPI mandate details.
This circular shall come into force with immediate effect. The provisions of this circular shall become part of the offer documents, DRHP and RHP.
This circular is being issued in exercise of the powers under section 11 read with section 11A of the Securities and Exchange Board of India Act, 1992.
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Source: SecMarx — Streamlining the Process of Public Issues and redressal of Investor grievances. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.