Sebi: Under this, it has been decided to eliminate the provision of ban on securities without PAN, KYC details and ‘Nomination’.
Sebi: Capital market regulator SEBI has simplified the rules for those holding securities in paper form. Under this, it has been decided to eliminate the provision of ban on securities without PAN, KYC details and ‘nomination’.
Purpose of simplifying the rules
The Securities and Exchange Board of India (Sebi) said in a circular that the purpose of this initiative is to simplify the rules. This step will come into effect with immediate effect. This decision has been taken after receiving suggestions from Registrar Association of India and investors.
What was the rule earlier?
Under the rule, it was mandatory for all those holding shares in listed companies in physical form i.e. in paper form to give specimen signatures for PAN, nomination, contact details, bank account details and the respective folio number. SEBI had said in May that it is necessary to detain issue and share transfer agents (RTAs) in ‘folios’ in which none of such documents will be available on or after October 1, 2023.
While amending the circular issued by the regulator in May, SEBI said that the word ‘freeze’ has been removed. SEBI said, based on the report received from the Registrar Association of India, suggestions received from investors and to reduce the administrative challenges related to banning of shares under the Benami Transactions (Prohibition) Act, 1988 and/or Anti-Money Laundering Act. To do this, it has been decided to abolish the above provision.