Sebi eases rule for physical securities'
holders without PAN, KYC details
Capital markets regulator Sebi
on Friday decided to do away with the provision of requiring the freezing of
folios without PAN, KYC details and nomination for all holders of physical
securities. The move, aimed at simplifying the rule, will come into force with
immediate effect, the Securities and Exchange Board of India (Sebi) said in a circular.
The decision has been taken
after receiving feedback from the Registrars' Association of India and
investors.
Under the rule, it was
mandatory for all holders of physical securities in listed companies to furnish
PAN, nomination, contact details, bank account details and specimen signature
for their corresponding folio numbers.
The folios wherein any one of
such documents are not available on or after October 1, 2023, is required to be
frozen by the Registrars to an Issue and Share Transfer Agents (RTA), Sebi said
in May.
Amending the circular issued
in May, Sebi said that reference to the term 'freezing/ frozen' has been
deleted.
"Based on representations
received from the Registrars' Association of India, feedback from investors,
and to mitigate unintended challenges on account of freezing of folios and
referring frozen folios to the administering authority under the Benami
Transactions (Prohibitions) Act, 1988 and/or Prevention of Money Laundering
Act, 2002, it has been decided to do away with the above provisions," Sebi
said.
Further, frozen folios were
required to be referred by the RTA or listed company to the administering
authority under the Benami Transactions (Prohibitions) Act, 1988, and/or
Prevention of Money Laundering Act, 2002, if they continue to remain frozen as
on December 31, 2025.
www.economictimes.indiatimes.com dt. 20.11.2023