Regulation 19 - Eligibility for acquiring or holding shares - Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2018

Eligibility for acquiring or holding shares 19. (1) No person shall, directly or indirectly, acquire or hold any equity shares or voting rights of a recognised stock exchange or recognized clearing corporation unless he is a fit and proper person: Provided that the onus shall be on the recognised stock exchange/ recognised clearing corporation to ensure that all its shareholders are fit and proper persons: Provided further that such a requirement to ensure that all its shareholders are fit and proper persons shall not be applicable to a 1 [*****] recognized stock exchange for shareholding of a person who directly or indirectly, acquires or holds less than two percent equity shares or voting rights of such 1 [*****] recognized stock exchange. 2 [******] (3) A person eligible to acquire or hold more than five per cent of the paid up equity share capital under sub-regulation (2) and (3) of regulation 17 and sub-regulation (2) and (3) of regulation 18 may acquire or hold more than five per cent of the paid up equity share capital of a recognised stock exchange or a recognised clearing corporation only if he has obtained prior approval of the Board. (4) The application for seeking approval in terms of 3 [****] sub-regulation (3) of this regulation shall be made to the Board in the manner specified at PART F of Schedule II of these regulations through the concerned stock exchange / clearing corporation. (5) The stock exchange / clearing corporation shall verify the declarations/ undertakings given by the shareholders under sub-regulation (4) and forward the application along with its recommendation for approval to the Board. 4 [*****] (7) Any person holding two per cent. or more of the paid up equity share capital in a recognised stock exchange or a recognised clearing corporation, as the case may be, shall file a declaration within fifteen days from the end of every financial year to the recognised stock exchange or recognised clearing corporation, as the case may be, that he complies with the fit and proper criteria provided in these regulations. ----------------- Notes: 1. Omitted vide Notification No. SEBI/LAD-NRO/GN/2021/44. Dated 13-08-2021 before it was read as: listed 2. Omitted vide Notification No. SEBI/LAD-NRO/GN/2021/44. Dated 13-08-2021 before it was read as: (2) Any person who acquires equity shares or voting rights, in a recognised stock exchange or recognized clearing corporation, directly or indirectly, either individually or together with persons acting in concert, that entitles the person(s) so acquiring to exercise any voting rights in the range of two percent to five per cent, shall seek approval of the Board within fifteen days of such acquisition. 3. Omitted vide Notification No. SEBI/LAD-NRO/GN/2021/44. Dated 13-08-2021 before it was read as: sub-regulation (2) or 4. Omitted vide Notification No. SEBI/LAD-NRO/GN/2021/44. Dated 13-08-2021 before it was read as: (6) If approval under sub-regulation (2) is not granted by the Board to any person, such person shall forthwith divest his entire shareholding in the recognised stock exchange / recognised clearing corporation.