Exemption to Listed entites under Regulation 24A from quarterly reporting of SDD Compliance

The PIT Regulations, 2015 require the Board of Directors or head(s) of an organization to maintain a Structured Digital Database (SDD) in compliance with the regulations for handling unpublished price-sensitive information. A recent circular issued by the National Stock Exchange of India Ref No: NSE/CML/25 dated 29th March 2023, mandates the Quarterly reporting requirement to the Exchange pertaining to SDD even though entities are not covered under Regulation 24A of SEBI(LODR). This means that entities falling under specified limits as per Regulation 15(2) of SEBI (LODR) regulation 2015 are required to submit a quarterly report on SDD within 21 days from the end of each quarter to NSE.

The following is the exact replica of the circular paragraph “This is in continuation to the circular No. NSE/CML/2022/51, circular No. NSE/CML/2022/52 dated November 04, 2022, Circular No. NSE/CML/2023/09 dated January 25, 2023, and circular Ref No: NSE/CML/ 2023/21 dated March 16, 2023, issued by the Exchange, the listed entities are advised to take a note that the listed entities to whom the provisions of Regulation 24A of SEBI (LODR) Regulations, 2015 are not applicable, are required to continue to submit SDD Compliance certificate on quarterly basis within 21 days from end of each quarter on sdd_pit@nse.co.in email id”.  Says NSE to all listed entities

Regulation 24A of SEBI(LODR) deals with Secretarial Audit and Secretarial Compliance Report (ASCR). However, the listed entities having paid-up equity share capital not exceeding Rs.10 Crore and net worth not exceeding Rs.25 Crores as on the last day of the previous financial year are exempt from submitting an Annual Secretarial Compliance Report. This is in accordance with Regulation 15(2) of SEBI (LODR) Regulation, 2015.

Interestingly, the circular Ref No: NSE/CML/25 is connected to Circular No. NSE/CML/2023/21 dated 16 March 2023, which states that listed entities falling under Regulation 24A of SEBI(LODR) need to provide additional affirmations while submitting ASCR by Practising Company Secretary to the exchange. The 10th point of the circular clearly deals with SDD maintenance under Regulation 3(5) & 3(6) SEBI (Prohibition of Insider Trading) Regulations, 2015. If a listed entity’s PCS provides an affirmation of compliance, then there is no need for quarterly reporting to the Stock Exchange. However, if the PCS affirms non-compliance with Regulation 3(5) & 3(6) SEBI (Prohibition of Insider Trading), the entity will be displayed as non-compliant with SDD on the “Get Quote” page of the exchange website until the exchanges have satisfactorily verified that the company has complied.

It is important to note that quarterly reporting requirements to the National Stock Exchange by entities falling under Regulation 24A of SEBI (LODR) have been discontinued from the final quarter of the financial year 2022-23 onwards even PCS affirms the Compliance status yes or no in ASCR pertaining to Regulation 3(5) and 3(6) of SEBI (Prohibition of Insider Trading) Regulations, 2015.

Also Read Circular Dated 10th April 2023- Additional affirmations by Practicing Company Secretaries in ASCR

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National Stock Exchange of India

Circular Ref No: NSE/CML/ 2023/21 Date: March 16, 2023

To,
All Listed Entities,

Sub: Additional affirmations by Practicing Company Secretaries (PCS) in Annual Secretarial Compliance Report (ASCR)

1. Overview

SEBI vide circular CIR/CFD/CMD1/27/2019 dated February 08, 2019 issued the format of Annual secretarial compliance report for listed entities and their material subsidiaries which was effective from March 31, 2019 onwards. The Annual secretarial compliance report to be filed on annual basis by PCS confirming the compliances of all SEBI Regulations, circulars and guidelines.

2. Based on various discussions with SEBI, following are the additional affirmations to be provided while submitting ASCR

Sr. No.	Particulars	Compliance status (Yes/No/NA)	Observations /Remarks byPCS*
1.	Secretarial Standard The compliances of listed entities are in accordance with the Auditing Standards issued by ICSI, namely CSAS-1 to CSAS-3
2.	Adoption and timely updation of the Policies: All applicable policies under SEBI Regulations are adopted with the approval of board of directors of the listed entities· All the policies are in conformity with SEBI Regulations and has   been   reviewed  &   timely updated as   per   the regulations/circulars/guidelines issued by SEBI
3.	Maintenance and disclosures on Website: The Listed entity is maintaining a functional website Timely dissemination of the documents/ information under a separate section on the website Web-links provided in annual corporate governance reports under Regulation 27(2) are accurate and specific which re­directs to the relevant document(s)/ section of the website
4.	Disqualification of Director: None of the Director of the Company are disqualified under Section 164 of Companies Act, 2013
5.	To examine details related to Subsidiaries of listed entities: (a) Identification of material subsidiary companies (b) Requirements with respect to disclosure of material as well as other subsidiaries
6.	Preservation of Documents: The listed entity is preserving and maintaining records as prescribed under SEBI Regulations and disposal of records as per Policy of Preservation of Documents and Archival policy prescribed under SEBI LODR Regulations, 2015
7.	Performance Evaluation: The listed entity has conducted performance evaluation of the Board, Independent Directors and the Committees at the start of every financial year as prescribed in SEBI Regulations
8.	Related Party Transactions: (a) The listed entity has obtained prior approval of Audit Committee for all Related party transactions (b) In case no prior approval obtained, the listed entity shall provide detailed reasons along with confirmation whether the transactions   were   subsequently approved/ratified/rejected by the Audit committee
9.	Disclosure of events or information: The listed entity has provided all the required disclosure(s) under Regulation 30 alongwith Schedule III of SEBI LODR Regulations, 2015 within the time limits prescribed thereunder.
10.	Prohibition of Insider Trading: The listed entity is in compliance with Regulation 3(5) & 3(6) SEBI (Prohibition of Insider Trading) Regulations, 2015
11.	Actions taken by SEBI or Stock Exchange(s), if any: No Actions taken against the listed entity/ its promoters/ directors/ subsidiaries either by SEBI or by Stock Exchanges (including under the Standard Operating Procedures issued by SEBI through various circulars) under SEBI Regulations and circulars/ guidelines issued thereunder
12.	Additional Non-compliances, if any: No any additional non-compliance observed for all SEBI regulation/circular/guidance note etc.

*Observations/Remarks by PCS are mandatory if the Compliance status is provided as ‘No’ or ‘NA’

3. Revised Format of Annual Secretarial Compliance Report:

Additional columns have been inserted in the format of ASCR which is provided below:

(a) The listed entity has complied with the provisions of the above Regulations and circulars/ guidelines issued thereunder, except in respect of matters specified below: –

National Stock Exchange of India

Sr . N o.	Compliance Requirement (Regulations/ circulars/guid elines including specific clause)	Regul ation/ Circul ar No.	Deviati ons	Action Taken by	Type of Action	Detai ls of Viola tion	Fine Amoun t	Observati ons/Rem arks of the Practicin g Company Secretary	Manag ement Respon se	Remar ks
					Advisory/Clar ification/Fine /Show Cause Notice/ Warning, etc.

(b) The listed entity has taken the following actions to comply with the observations made in previous reports:

Sr . N o.	Compliance Requirement (Regulations/ circulars/guid elines including specific clause)	Regul ation/ Circul ar No.	Deviati ons	Action Taken by	Type of Action	Detai ls of Viola tion	Fine Amoun t	Observati ons/Rem arks of the Practicin g Company Secretary	Manag ement Respon se	Remarks
					Advisory/Clar ification/Fine /Show Cause Notice/ Warning, etc.

Kindly note: (1) Table (a) and (c) of the SEBI ASCR format issued vide SEBI circular no. CIR/CFD/CMD1/27/2019 dated February 08, 2019, will be merged.

(2) Point (b) of the SEBI ASCR format will be omitted as the same has been included in the additional affirmations

(3) Table (d) will be revised and re-numbered to table (b)

(4) Columns marked in red are the additional columns inserted

The Listed entities are advised to bring the provisions of this circular to the notice of all the Company Secretaries in practice.

The abovementioned circular will be effective from the financial year ended March 31, 2023 onwards.

For and on behalf of
National Stock Exchange of India Limited

Raksha Jain
Manager

Department: Listing

Circular Ref. No: NSE/CML/25

Date: March 29, 2023

To

All Listed Entities,

Sub: Standard Operating Process under SEBI(PIT) Regulations, 2015 for ensuring compliance with Structured Digital Database (“SDD”)

This is in continuation to the circular No. NSE/CML/2022/51, circular No. NSE/CML/2022/52 dated November 04, 2022, Circular No. NSE/CML/2023/09 dated January 25, 2023 and circular Ref No: NSE/CML/ 2023/21 dated March 16, 2023 issued by the Exchange, the listed entities are advised to take a note that the listed entities to whom the provisions of Regulation 24A of SEBI(LODR) Regulations, 2015 are not applicable, are required to continue to submit SDD Compliance certificate on quarterly basis within 21 days from end of each quarter on sdd_pit@nse.co.in email id.

The circular shall be effective immediately.

All Listed companies are requested to take note and comply accordingly.

For and on behalf of
National Stock Exchange of India Limited

Yogesh Deshmukh
Senior Manager