[The following post is contributed by Yogesh Chande, who is a Consultant with Economic Laws Practice, Advocates & Solicitors. Views of the author are personal] It may be recalled that, pursuant to an announcement issued by Fresenius Kabi Oncology Limited (target company) on 30 May 2012, the stock exchanges were informed that its promoter shareholders have notified the target company of their...
Securities Laws Amendment Ordinance: An Overview
As some of us have observed time and again on this Blog, the substantive aspects of securities regulation have become progressively extensive and sophisticated in India. Over the last two decades of SEBI’s functioning, it has constantly updated securities laws to meet with market developments, whether it is in the primary markets (IPOs, QIPs, etc.) or in the secondary markets (insider trading...
Committee Report on Foreign Portfolio Investments
In mid-June, SEBI had announced the submission of a report by the Committee on Rationalization of Investment Routes and Monitoring of Foreign Portfolio Investments under the chairmanship of Mr. K.M. Chandrasekhar. The full report in now available online. The key recommendations of the committee are to combine the erstwhile portfolio investment categories of foreign institutional investors (FIIs)...
SAT Order on Minimum Public Shareholding Norms
The Securities Appellate Tribunal issued its order in the case involving compliance of the public shareholding norms in Gillette India Limited. Gillette had filed an appeal against an order of the Securities and Exchange Board of India (SEBI) rejecting Gilette’s proposal for compliance with the public shareholding norms. However, SAT dismissed Gillette’s appeal in an order that extensively...
SEBI Order on Public Shareholding Norms
The deadline for compliance by non-government entities of the public shareholding norms went by on June 3, 2013. Immediately thereafter, SEBI yesterday issued an order against 108 companies that have failed to comply with these norms. SEBI’s press release summarizing its order is available here. A couple of points are noteworthy. The first relates to the rapidity with which SEBI has acted. This...
SEBI Clarifies on Schemes of Arrangement
Following SEBI’s circular of February 4, 2013 imposing stringent requirements for oversight of schemes of arrangement, there were certain issues that required clarification (discussed here and here). Now, by way of another circular dated May 21, 2013, SEBI has clarified some of the outstanding issues and also made some modifications to the previous circular. In this post, we discuss some of the...
Public Shareholding Norms: Consequences of Non-Compliance
The June 2013 deadline for compliance by listed companies with the minimum public shareholding of 25% is looming closer. The deadline for compliance by public sector (government) listed companies to comply with the 10% minimum public shareholding will follow in August. Over the last few months, several companies have already reduced their promoter shareholding to meet with these norms. This has...
Enforceability of Put and Call Options: Reality Soon?
Although put and call options are quite common in investment agreements, its enforceability under Indian law has been in serious doubt due to age-old provisions in securities laws which have not been updated to meet with the requirement of the times. I have discussed the issue in detail in this paper and also called “for a reconsideration of the legal regime so that physically settled options...
Extension of Date for Implementation of Modified ESOP Rules
Earlier this year, SEBI had announced the implementation of amended rules for the issue of employee stock options (ESOPs), which restricted the types of schemes to only those that comply with SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999. Particularly, curbs were imposed on the acquisition of shares in the secondary markets by ESOP trusts. The rationale...
Supreme Court on “Market Abuse”
In a judgment delivered last Friday, the Supreme Court came down heavily on “market abuse” not just on the case at hand but more generally on the practice to the extent prevalent in India. The case, N. Narayanan v. Adjudicating Officer, SEBI, arose in the form of an appeal from the Securities Appellate Tribunal (SAT) in relation to the appellant who was the whole time director of Pyramid Saimara...
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