Securities and Exchange Board of India (SEBI) has finalized and specified the Model Equity Listing Agreement for execution between the Small and Medium Enterprise (SME) issuer and the Stock Exchange.
In recognition of the need for making finance available to Small and Medium Enterprises (SME) to tap/access capital markets, SEBI had decided to encourage promotion of dedicated exchanges and/or dedicated platforms of the exchanges for listing and trading of securities issued by SME. In continuation of the same and to facilitate listing of specified securities in the SME exchange, SEBI has specified the Model Equity Listing Agreement for execution between the issuer and the Stock Exchange, to list/migrate the specified securities on SME exchange, vide its circular dated May 17, 2010. The model listing agreement is available in the website of SEBI at www.sebi.gov.in under the categories “Legal Framework” and “Issues and Listing”. SMEs, by virtue of being listed in a recognized stock exchange with all its disclosure norms, are likely to attract capital, whether equity or debt.
SEBI has also issued necessary guidelines in this regard. Vide its circular dated May 18, 2010, it has permitted for setting up of a Stock exchange/a trading platform for SMEs by a recognized stock exchange having nationwide trading terminals and also issued Guidelines for market making for the specified securities listed on the SME exchange vide circulated dated April 26, 2010. Further, necessary amendments to the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 SEBI (Merchant Bankers) Regulations, 1992, SEBI (Foreign Institutional Investors) Regulations, 1995 SEBI (Venture Capital Funds) Regulations, 1996, SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 and SEBI (Stock Brokers and Sub-brokers) Regulations, 1992 have also been carried out, to enable the SMEs to access the capital market.
This information was given by the Minister of State for Finance, Shri Namo Narain Meena in written reply to an Unstarred Question in Lok Sabha today.
