SEBI has amended the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, to provide for the following amendments relating to a rights issue :

• In the letter of offer and the abridged letter of offer, the issuer shall disclose the process of credit of rights entitlements in the demat account and renunciation thereof [sub-regulation (7) of reg. 70 inserted];
• An applicant to the rights issue shall do so only through the ASBA facility; payment through any other electronic banking mode shall be permitted in respect of an application made for any reserved portion outside the issue period [Reg. 76 substituted]
• The rights entitlement shall be credited to the demat account of the shareholders before the date of opening of the issue and allotment of specified securities shall be made in dematerialized form only [Reg.77A inserted];
• The issuer shall in addition to issuing an advertisement in one English national, Hindi national and regional language newspaper shall also give an intimation to the stock exchanges for dissemination on their websites at least two days before the date of opening of the issue.[Reg. 84 amended]
• The payment of balance money in calls, outside the issue period, may be through electronic banking modes [ proviso to Reg. 88 inserted]

Related amendments have also been made to Form A in Schedule V and Part B of Schedule VI.

To refer to the notification of the SEBI (Issue of Capital and Disclosure Requirements) (Sixth Amendment) Regulations 2019, dated 26 December 2019, click here