Sebi working on automated system driven disclosures
The Securities and ExchangeBoardofIndia(Sebi)is working on a concept of systemdriven disclosures that would capture and disclose changes in shareholdinginalistedcompany, twopeoplewithdirectknowledge of the matter said.
“Thesystembeingworkedout will automatically gather and integrate the change in shareholding information from stock exchanges, depositories andregistrar and transfer agents in a timely and accurate manner,” said the first person, declining to be named.
The move is aimed at ease of doing business through system drivendisclosureandthiswould remove additional reporting requirements,thispersonadded.
In the latest edition of ease of doingbusinessrankingsreleased onTuesdaybyWorldBank,India jumped 30 positions to the 100th place among 190 countries.
According to an Economic Times report on 2 November, India is gearing up to leapfrog intothetop50witharound90specific reformslined upforvarious ministries. Sebi’s move for automated disclosure is one of those.
AnemailsenttoaSebispokesperson on Wednesday was not answered until press time.
“Use of technology for integrateddisclosures will definitely usher ease of business. As it will reduce the compliance requirement on companies, promoters and individuals on reporting changeofshareholding,thisdata willautomaticallybecapturedby depositories and exchanges,” said Sumit Agarwal, Partner, Suvan Law Advisors.
“Oncethissystemtakesoffwe mightseemoredisclosuresbeing automatedandfurtherreducing compliancerequirement,”Agarwal added.
Under the Listing Obligation andDisclosureRequirementsor LODR,companiesneedtoreport changeintheirshareholdingpattern pursuant to a merger, de-merger, acquisition by promoters and issue of convertibles every quarter. Any violation observedleadstoapenaltyunder the Sebi Act.
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