Sebi will now recognise foreign-university degrees for merchant bankers registration

The regulator has excluded promoters' shares from entitlement ratio calculations if they opt out of buy-back and disclosing the same in the public announcement publicly and prominently.

The market regulator will now accept a recognised degree from a foreign university or institution in finance or law or accountancy or business management for grant of certificate of registration for merchant banker.

Until now, under SEBI (Merchant Bankers) Regulations, 1992, only those with professional qualification from a government-recognised Indian institution could apply for the registration.

After meeting with its Board, the Securities and Exchange Board of India (Sebi) announced ease-of-doing business measures for merchant bankers including the following:

Under SEBI (Merchant Bankers) Regulations, 1992

1.Discontinuing the requirement of submitting statement specifying Merchant Bankers’ responsibilities separately. Exempting common Independent Director between Issuer and Merchant Banker from the definition of associate subject to recusal by the said Independent Director in respect of the issue, on both the Issuer’s and the Merchant Banker’s Boards.

Also read: Sebi eases LODR and ICDR Regulations; not all tax penalties and fines need to be disclosed henceforth

2.Merchant Bankers acting as an Underwriter would need to fulfil their underwriting obligations before finalizing the basis of allotment i.e. before T+2.

Under SEBI (Bankers to an Issue) Regulations, 1994

1.In addition to managing issue related activities currently permitted under SEBI (Bankers to an Issue) Regulations, 2014, Bankers to an Issue would now also be permitted to carry out activities as required under applicable regulations such as open offers, buy-backs and such other activities as may be specified by SEBI.

Under SEBI (Buy-Back of Securities) Regulations, 2018

1.Exclusion of promoters' shares from entitlement ratio calculations if they opt out of buy-back and disclosing the same in the public announcement publicly and prominently.

2.Disclosure of the entitlement ratio on the cover page of the Letter of Offer and providing a link for shareholders to check their buy-back entitlement.

3.Permitting companies to issue shares for subsisting obligations which are convertible during the buy-back period provided disclosures of subsisting obligations and their impact is disclosed in the public announcement