Continue Reading FIG Paper (No. 37 – Series 1) | SEBI Proposes to Introduce ‘New Asset Class’
SEBI had, vide its Circular dated August 24, 2023 (“August Circular”), laid down norms for FPIs/investor groups with assets under management (“AUM”) exceeding INR 25,000 (twenty five thousand) crore (“Size-based Criteria”). These norms require furnishing granular details[1] of all their investors/stakeholders on a look-through basis to ascertain if the FPI is effectively domiciled in a Land Bordering Country (“LBC”) or not. Subsequently, SEBI in its consultation paper dated July 30, 2024, (“Consultation Paper”) has proposed to replace the Size based Criteria with a “risk-based criteria” depending upon the participation of investors from “land bordering countries”. In addition to providing an overview of the extant laws, this blog covers the roadblocks emerging from the August Circular, SEBI’s proposal in the Consultation Paper, and its implications.Continue Reading SEBI Proposes to Replace ‘Size Criteria’ for FPIs with ‘Risk-Based Approach’ for Granular Disclosure Requirement for Underlying Investors
The Government of India’s socialistic approach towards controlling managerial remuneration between 1960s and 1990s has been a painful chapter in the history of India’s company law. While the restriction applied only to those on the board of directors, the limits the then Department of Company Affairs had prescribed in its administrative guidelines under the Companies Act, 1956 in November 1969 was as low as INR 7,500 per month and further reduced to INR 5000 per month years later. Any payment beyond those limits required the Central Government’s approval, which was also a very cumbersome and time-consuming process. This led to the unhealthy practice of compensating Managing Directors and Executive Directors (“MD/EDs”) with cash reimbursements and many other inappropriate methods. Some MDs/ EDs also stepped down from the board to accept positions one level below the board. They were designated as presidents and vice presidents despite performing the role of the Managing Director.Continue Reading Managerial Remuneration – Should Promoters Be Disenfranchised?
From claiming phantom carbon credits to the mid-air opening of a plane door: recent instances highlight the need and role of robust corporate governance practices in preventing and identifying misconducts. Resultantly, thwarting potential regulatory actions.Continue Reading ESG Disclosures: A New Frontier in Combating Corporate Misconduct
The Securities Exchange Board of India (“SEBI”) has released a consultation paper on May 23, 2024[1] (“Consultation Paper”), wherein it has suggested modifications to certain aspects of the valuation framework for AIFs.Continue Reading Analysis of SEBI’s Consultation Paper on Valuation Framework for AIFs
The Securities Exchange Board of India (“SEBI”) has released updated Master Circulars for Investment Advisers (“IAs”) and Research Analysts (“RAs”) on May 21, 2024 (“Master Circulars”).Continue Reading SEBI Recognises Stock Exchanges as Supervisory and Administrative Body for Investment Advisers and Research Analysts
On March 20, 2024, the Insurance Regulatory and Development Authority of India (“IRDAI”) notified the IRDAI (Registration, Capital Structure, Transfer of Shares and Amalgamation of Insurers) Regulations, 2024 (“Registration and Capital Regulations”), which consolidated and rationalised the regulatory framework applicable on an Indian insurer in aspects, including listing on a stock exchange pursuant to an initial public offer (“IPO”) that may consist of a fresh issue of equity shares or an offer for sale. Our detailed analysis on the other aspects of Registration and Capital Regulations can be found here.Continue Reading IRDAI Regulatory Reform Series: Listing of Indian Insurance Companies on Stock Exchanges
The Foreign Portfolio Investor (“FPI”) regime is a foreign investments’ entry route in India, whereby FPIs can invest in Indian securities, subject to compliance with India’s foreign exchange control laws and the regulatory framework issued by the Securities and Exchange Board of India (“SEBI”). As part of the Know Your Customer (“KYC”) process for FPI registration, identification and verification of Beneficial Owner(s) (“BO”) is required to be undertaken as per Rule 9 of the Prevention of Money Laundering (Maintenance of records) Rules, 2005 (“PMLR”),[1] which is a part of the Indian AML/ CFT legal framework.Continue Reading New SEBI FPI Beneficial Owner Disclosure Norms
It is the Board’s responsibility to successfully run a company, as per Section 179 of the Companies Act, 2013 (“Act”). Hence, it is imperative that the Boards function effectively to ensure that the company’s interests are always kept at the forefront while protecting interests of all stakeholders.Continue Reading Board Effectiveness – Challenges and Opportunities
The Securities Exchange Board of India (“SEBI”) has notified amendments to the SEBI Alternative Investment Funds Regulations, 2012 (“SEBI AIF Regulations”) on April 25, 2024, to:Continue Reading FAQs on Regulatory Amendments to AIF Regulations (Ambiguous GAAR Style Obligations Prescribed for Managers and KMPs)