The Securities and Exchange Board of India (SEBI) had vide its circular dated December 7, 2018 (SBO Circular) mandated all listed companies to disclose significant beneficial ownership (SBO) in the shareholding of such listed companies by March 31, 2019. Refer to our news alert on this here.
Recently, the Ministry of Corporate Affairs (MCA) also brought out the Companies (Significant Beneficial Owners) Amendment Rules, 2019 (2019 SBO Amendment Rules), which were notified on February 8, 2019, and revamped the Companies (Significant Beneficial Owners) Rules, 2018 (2018 SBO Rules) substantially, inter alia, modifying the definition of SBO, the criteria for determination of SBOs, and the timelines for disclosures/ filings by all companies. Refer to our news alert on this here .
By its recent circular dated March 12, 2019, SEBI has now amended and aligned its previous SBO Circular with the 2019 SBO Amendment Rules to avoid any ambiguities. The following requirements will now be applicable to listed companies:
- The requirements mandated by SEBI under the SBO Circular will apply only to such listed entities that are reporting companies under the 2018 SBO Rules, as amended;
- The disclosures and submissions to be made under the SBO Circular should be in line with the 2018 SBO Rules;
- Revised format for disclosure by all listed companies in relation to SBO shareholding in the company has been prescribed, which includes details such as direct or indirect holding of SBO by virtue of shares/ voting rights/ rights on distributable dividend or any other distribution/ exercise of control or significant influence;
- Listed companies need to disclose SBO holding by quarter ended June 30, 2019.
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As anticipated, SEBI has aligned its previous circular for SBO disclosures with the new rules introduced by the MCA recently. All listed companies will need to examine applicability of, and make required disclosures both under the 2018 SBO Rules and the SBO Circular, as amended.
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