Timeline to Restore ‘Minimum Public Shareholding’ in Listed Companies Specified

Securities Contracts (Regulation) Rules, 1957 (“Rules”) has been amended by SEBI by passing Securities Contracts (Regulation) (Amendment) Rules, 2018 (“Amendment Rules”) on July 24, 2018.

As per the Amendment Rules,when the public shareholding in a listed company falls below 25%due toimplementation of the resolution plan approved under Insolvency and Bankruptcy Code,2016, such company shall bring back the public shareholding to 25% within amaximum period of 3 years from the date of such fall.

The Amendment Rules also provide that if the public shareholding falls below 10%, the same shall be increased to at least 10%, within a maximum period of 18 months from the date of such fall.