SEBI has issued a circular allowing the subscription to non-convertible securities during trading window closure periods. This amendment aligns with Clause 4(3)(b) of Schedule B and Regulation 9(1) of the SEBI (Prohibition of Insider Trading) Regulations, 2015 (PIT Regulations). Trading window restrictions, previously relaxed for rights issues, public issues, prefer-ential allotments, buy-back offers, and other specified transactions, now extend to subscriptions for non-convertible securities.
This change builds on SEBI’s earlier circular from July 23, 2020, which included Offer for Sale and Rights Entitlement transactions in the exemption framework. The revised provision aims to stream-line transactions in securities markets, ensuring regulatory clarity and operational ease for listed enti-ties and investors.
Stock exchanges are required to notify listed companies and disseminate this update on their web-sites. The circular, issued under SEBI’s regulatory powers, takes immediate effect and is available on SEBI’s website under the “Legal→ Circulars” section. For further details or clarifications, stakeholders may contact SEBI via the provided channels.
Securities and Exchange Board of India
Circular No. SEBI/HO/ISD/ISD-PoD-2/P/CIR/2024/180 Dated: December 30, 2024
To
1. All Recognized Stock Exchanges
2. All Depositories
3. All Listed Companies through the Stock Exchanges
Sir/ Madam,
Sub: Allowing subscription to the issue of Non- Convertible Securities during trading window closure period.
1. In terms of Clause 4(3)(b) of Schedule B read with sub-regulation (1) of Regulation 9 of SEBI (Pro-hibition of Insider Trading) Regulations, 2015 (PIT Regulations) the trading window restrictions shall not apply in respect of transactions, such as, acquisition by conver-sion of warrants or debentures, subscribing to rights issue, further public issue, preferential allot-ment or tendering of shares in a buy-back offer, open offer, delisting offer or such other transactions which are undertaken in accordance with the mechanisms as may be specified by the Board from time to time.
2. In this regard, SEBI vide Circular No. SEBI/HO/ISD/ISD/CIR/P/2020/133 dated July 23, 2020, pro-vided that in addition to the transactions mentioned in Clause 4(3)(b) of Schedule B read with Regu-lation 9 of PIT Regulations, trading window restrictions shall not apply in respect of Offer for Sale and Rights Entitlements Transactions carried out in accordance with the framework specified by the Board from time to time.
3. It has been decided that in addition to the transactions mentioned in Clause 4(3)(b) of Schedule B read with sub-regulation (1) of Regulation 9 of PIT Regulations and SEBI Circular no. SEBI/HO/ISD/ISD/CIR/P/2020/133 dated July 23, 2020, the trading window restrictions shall also not apply to subscription to the issue of non- convertible securities, carried out in accordance with the framework specified by the Board from time to time.
4. Stock Exchanges are advised to bring the provisions of this circular to the notice of all listed com-panies and also disseminate the same on their websites.
5. This circular is issued in exercise of the powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992 read with Regulations 4(3) and 11 of the PIT Regulations and to protect the interests of investors in securities and to promote the development of and to regulate the securities market and shall come into effect with immediate effect.
6. This Circular is available on the SEBI website at https://www.sebi.gov.in/ under the cate-gory “Legal→ Circulars”.
Yours faithfully,
A Vijayan
Deputy General Manager
Phone: +91-22-26449631
E-mail: vijayan@sebi.gov.in
