SEBI (Settlement Proceedings) (Amendment) Regulations, 2020

SECURITIES AND EXCHANGE BOARD OF INDIA
NOTIFICATION
Mumbai, the 22nd July, 2020

SECURITIES AND EXCHANGE BOARD OF INDIA (SETTLEMENT PROCEEDINGS) (AMENDMENT)
REGULATIONS, 2020

No. SEBI/LAD-NRO/GN/2020/24.— In exercise of the powers conferred by Section 1 5JB of the Securities and Exchange Board of India Act, 1992, Section 23JA of the Securities Contracts (Regulation) Act, 1956 and Section 19-IA of the Depositories Act, 1996 read with Section 30 of the Securities and Exchange Board of India Act, 1992, Section 31 of the Securities Contracts (Regulation) Act, 1956 and Section 25 of the Depositories Act, 1996, the Securities and Exchange Board of India hereby makes the following regulations to amend the Securities and Exchange Board of India (Settlement Proceedings) Regulations, 2018, namely:—

1. These regulations may be called the Securities and Exchange Board of India (Settlement Proceedings) (Amendment) Regulations, 2020.

2. They shall come into force on the date of their publication in the Official Gazette.

3. In the Securities and Exchange Board of India (Settlement Proceedings) Regulations, 2018 –

(1) In the regulation 15, in the sub-regulation (2),

(i) in clause (a),

(a) after the words “not later than” and before the words “calendar days from the date of receipt”, for the word, “fifteen”, the word “thirty”, shall be substituted;

(b) for the words, “by fifteen calendar days”, the words “by sixty calendar days, only after receipt of an application seeking extension of time within thirty days from the date of receipt of notice of demand” shall be substituted;

(ii) in the explanation to the clause (a),-

(a) the words “by way of a demand draft drawn in favour of ‘Securities and Exchange Board of India’ payable at Mumbai or” shall be omitted;

(b) after the words “or any other authorised” and before the words “mode of payment”, the word “electronic” shall be inserted;

(2) Chapter VIII, shall be omitted.

(3) In regulation 34, after sub-regulation (3), following sub-regulation, shall be inserted, –

“(4) Notwithstanding the omission of Chapter VIII, a Settlement Notice issued under regulation 18, shall be dealt with as if the Chapter VIII is still in force and continue to be dealt with accordingly.”

(4) In Schedule I, in Part – B ,

(i) the words “by way of a demand draft in favour of ‘Securities and Exchange Board of India’ Payable at Mumbai or”, shall be omitted;

(ii) after the words “or any other” and before the word “mode”, the word “electronic” shall be

(5) In Schedule II, in Chapter I, after Clause 11, following clause shall be inserted, –

“11A. The applicant shall be provided opportunity of hearing or meeting only before the Internal Committee.”

(6) In the Schedule II, in Chapter VI, in Table VI, the last row shall be substituted with the following: ‘‘

WHERE THE MAKING OF THE OPEN OFFER IS INFRUCTUOUS	INFRUCTUOUS BY AN ACT OF THE ACQUIRER	INFRUCTUOUS BY AN ACT OF THE COMPANY OR BY ANY OTHER REASON
	RUPEES 1 CRORE OR OPEN OFFER SIZE, WHICHEVER IS HIGHER	ANY AMOUNT BETWEEN RUPEES 10 LAKHS TO RUPEES 35 LAKHS; WITH A MULTIPLIER BETWEEN 1 TO 3 AS DECIDED BY THE IC OR HPAC OR THE PANEL OF WTMS

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(7) In Schedule II, in Chapter VI, in Table X shall be substituted with the following table.

TABLE-X

Residuary Ba, For Each Unit Of Alleged Default For Each Applicant Or On Joint Liability Basis (As Per The Sum Of Applicable

AMOUNTS IN CASE OF JOINT APPLICANTS)
	Individual (Promoters And Principal Officers Not Included) (I)	Body Corporate & Firm (Including Promoters And Principal Officers In Cases Relating To Joint Liability With The Body Corporate /Firm)  (II)	Promote, Principal Officers & Compliance Officers [When Not In II, IV-VII] (III)	Section 15B And 15F OF SEBI Act & Similar Defaults (Including Promoters And Principal Officers In Cases Relating To Joint Liability With The Intermediary Y)  (IV)	Failure In Redressing Investor Grievances (Including Promoters And Principal Officers In Cases Relating To Joint Liability With The Intermediary/ Issuer) (V) (For Delay Reduce To 1/4)	Market Infrast-ructure E Institution (Including Promoters And Principal Officers In Cases Relating To Joint Liability With The Institution) (VI)	Fund Related Defaults (Including Promoters And Principal Officers In Cases Relating To Joint Liability With The Fund) (VII)
BA Where: Default Relates To FUTP OR IT, False/ Misleading/ Incorrect/ Incomplete Disclosures In Offer Documents, Failure By Market Infrastr-ucture Institutions To Conduct Business In The Required Manner, A Reckless Violation, OR A Disgorgement / Ref Und In Excess Of Rupees 1 Crore (M)	Rupees 15 Lakhs	Rupees 1 Crores	Rupees 45 Lakhs	Rupees 15 Lakhs	Rupees 30 Lakhs	Rupees 5 Crores	Rupees 33 Lakhs OR 0.0 1% Of The Average Asset Under Manage-ment, At Time Of Violation OR 0.5% Of The Average Net Worth, At Time Of Violation, Whichever Is Higher
Benchmark Where Violation Involved At (M) AND, – Such Violation Directly Or Indirectly – (I) Resulted In Substantial Losses To Other Persons, (II) Created A Significant Risk Of Substantial Losses To Other Persons, Or (III) Affected The Integrity Of The Securities Markets (N)	Rupees 60 Lakhs	Rupees 3 Crores	Rupees 2 Crores	Rupees 60 Lakhs	Rupees 80 Lakhs	Rupees 10 Crores	Rupees 60 Lakhs OR 0.05% Of The Average Asset Under Manage-ment, At Time Of Violation OR 0.75% Of The Average Net Worth, At Time Of Violation, Whichever Is Higher
Residuary (O)	Rupees 3 Lakhs	Rupees 15 Lakhs	Rupees 10 Lakhs	Rupees 3 Lakhs	Rupees 6 Lakhs	Rupees 3 Crores	Rupees 15 Lakhs OR 0.001% Of The Average Asset Under Manage-ment, At Time Of Violation OR 0.05% Of The Average Net Worth, At Time Of Violation, Whichever Is Higher”

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(8) Part – B of the Schedule – III shall be omitted.

AJAY TYAGI , Chairman

[ ADVT.-III/4/Exty./123/2020-21]

Footnote:

1. The Securities and Exchange Board of India (Settlement Proceedings) Regulations, 2018 were published in the Gazette of India on November 30, 2018 vide No. SEBI/LAD-NRO/GN/ 2018/48, with effect from 1^st day of January 2019.