The government has notified changes in the Securities Contracts (Regulation) Rules, 1957, providing more time to listed entities to meet criteria of minimum public shareholding of 25 per cent.
“In the Securities Contracts (Regulation) Rules, 1957, in rule 19A, in sub-rule (1), in the proviso, for the words ‘two years’ the words ‘three years’ shall be substituted,” said a government notification dated July 31.
The changes have come into force from the date of their publication in the official gazette, it said.
Once a company is listed, its promoters are required to bring down their shareholding down to 75 per cent within the stipulated minimum shareholding period so as to meet minimum public float of 25 per cent.
The latest notification is the second major relief companies have got in this regard on account of the COVID-19 pandemic. On May 14, the Securities and Exchange Board of India (SEBI) relaxed the applicability of action on non-compliant entities.
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