IndiaCorpLaw

Tag: Stock Exchanges

  • 25% Free Float Requirement Becomes Law

    More than two years following the issue of a discussion paper on the topic, the Ministry of Finance (MOF) has on June 4, 2010 amended the Securities Contracts (Regulation) Rules, 1957 to set a limit of 25% minimum public shareholding for initial listing by companies on Indian stock exchanges as well as continued listing. MOF’s

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  • Enforcement of Corporate Governance Norms: Anecdotal Evidence

    A constant quibble with corporate governance in India is that while the body of substantive norms has been ballooning over time, the enforcement of those norms has not kept pace. In a somewhat unusual measure, the National Stock Exchange (NSE) has threatened to suspend trading of a listed company for failure to file governance reports

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  • Framework for SME Exchange

    After making a proposal nearly two years ago for the establishment of a separate stock exchange for small and medium enterprises (SMEs) to enable them to access the capital markets, SEBI has recently established the legal framework for achieving the same either through promotion of dedicated exchanges and/or dedicated platforms of the exchanges for listing

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  • Bits of Interest

    1.         Regulation of Credit Rating Agencies Drawing lessons from the role of credit rating agencies (CRAs) in the recent financial crisis, SEBI has imposed additional transparency and disclosure norms for the Indian CRAs. SEBI’s circular issued on May 3, 2010 covers issues such as maintenance of records of the rating process, dealing with conflicts of

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  • SEBI’s “Advisory Instructions” to BSE

    In a somewhat unconventional order, SEBI has on April 20, 2010 issued “advisory instructions” in a matter involving the Bombay Stock Exchange Limited (“BSE”). It arises out of a letter by the BSE to SEBI dated July 2, 2004 containing a proposal to introduce a market making scheme in the derivatives segment of the exchange.

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  • Multiplicity of Stock Exchanges

    Usually, stocks are listed on one major stock exchange in a given jurisdiction. For example, a U.S. stock will be listed either on the NYSE or NASDAQ. But, the position in India is different, perhaps for historical and other reasons, where not only there are multiple stock exchanges, but a number of companies are listed

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  • Consequences of Listing Violations

    One of the usual consequences that befalls a company when it violates conditions of the listing agreement is a delisting of its shares from the stock exchanges. This is perceived to be a disincentive that deters companies from breaching listing conditions. It has recently been put to use in a more mild form by the

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  • Corporate Bonds: Clearing and Settlement

    SEBI last week issued a circular prescribing the procedure for clearing and settlement of corporate bonds. This is an important step in the development of a robust corporate bond market that has not yet fully evolved in India, and appears to have been welcomed by the markets. The SEBI Updates blog has a post describing

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  • Regulation of Stock Exchanges

    The proposed establishment of a new stock exchange in India has caused a revival of the debate pertaining to regulation of stock exchanges. There are unique issues: stock exchanges are not only profit-making institutions that are companies in form and substance, but they also carry out a regulatory role in respect of companies that are

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