SEBI Board meeting

PRESS RELEASE NO. 24/2011, DATED 7-2-2011

The Board met today in Mumbai and took the following decisions:

1. ASBA facility mandatory for QIBs and NIIs:

The ASBA facility shall be mandatory for non-retail investors (Qualified Institutional Buyers and Non-Institutional Investors) making applications in public/rights issues with effect from May 1, 2011.

2. Initial registration of intermediaries to be for five years:

The intermediaries would be granted registration initially for a period of five years. On assessment of the performance of the intermediary and its track record during the initial five years, it will be granted registration on permanent basis.

3. Self clearing members for currency derivative segment:

The currency derivative segment would have self clearing members. They would be required to have net worth of Rs. 5 crore.

4. Recommendation to MCA on related party transactions :

SEBI will recommend to the Ministry of Corporate Affairs to suitably amend Clause 166 of the Companies Bill, 2009 to disallow interested shareholders from voting on the special resolution of the prescribed related party transaction. This will protect small and diversified shareholders in listed companies from abusive related party transactions. This view was taken based on the learning from the investigation in the matter of Satyam Computer Services Limited.

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