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TMI BlogSecurities Contracts (Regulation) (Manner of Increasing and Maintaining Public Shareholding in Recognised Stock Exchanges) Regulations, 2006.X X X X Extracts X X X X X X X X Extracts X X X X ..... (a) Act means the Securities Contracts (Regulation) Act, 1956 (42 of 1956); (b) associate in relation to a shareholder having trading rights in a recognized stock exchange means a person (i) who directly or indirectly, by himself or in combination with other persons, exercises control over such shareholder or holds substantial shares entitling not less than fifteen per cent. of the voting rights in such shareholder being a body corporate; or (ii) over whom such shareholder, directly or indirectly, by itself or in combination with other persons, exercises control; or (iii) whose director or partner is also a director or a partner of such shareholder, being a body corporate or a partnership firm, as the case may be; or (iv) who is a holding company or subsidiary company of such shareholder or a company under the same management as such shareholder; or (v) who is a relative of the shareholder being a natural person under 1 [Section 6] of the Companies Act, 1956 (1 of 1956); or (vi) who is a sub-broker of the shareholder in that stock exchange; or (vii) who acts in accordance with instructions of such shareholder in the exercise of votin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thereto, as the case may be. 3. Applicability. - These Regulations shall be applicable to all recognised stock exchanges in respect of which the scheme for corporatisation or demutualization has been approved by the Board under Section 4B of the Act. CHAPTER II MANNER OF INCREASING PUBLIC SHAREHOLDING 4. Manner of increasing the public shareholding.- Subject to the provisions of sub-section (8) of Section 4B of the Act and the scheme, the recognised stock exchange shall ensure that at least fifty-one per cent. of its equity share capital is held by the public, either by fresh issue of equity shares to the public through issue of prospectus or in the following manner: - (a) offer for sale, by issue of prospectus, of shares held by shareholders having trading rights therein; (b) placement of shares held by shareholders having trading rights to such persons or institutions as may be shortlisted by the recognised stock exchange with the approval of the Board; (c) issue of equity shares on private placement basis by the recognised stock exchange to any person or group of persons not being shareholders having trading rights or their associates subject t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Chapter, it shall issue a confirmation to the recognised stock exchange to that effect. CHAPTER III SHARE HOLDING RESTRICTIONS 8. Shareholding and transferability restrictions.- 3 [(1) No person resident in India shall at anytime, directly or indirectly, either individually or together with persons acting in concert, hold more than five per cent. of the equity share capital in a recognised stock exchange: Provided that a stock exchange, a depository, a clearing corporation, a banking company, an insurance company and a public financial institution defined under section 4A of the Companies Act, 1956 may hold, either directly or indirectly, either individually or together with persons acting in concert, upto fifteen per cent. of the paid up equity share capital of the recognised stock exchange: Provided further that person holding equity shares in a recognised stock exchange in excess of the limits specified in this regulation at the commencement of these regulations shall reduce his holding to ensure compliance with this regulation within the time specified in sub-section (8) of section 4B of the Act or the time extended under the proviso thereto. E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts in a recognised stock exchange shall, prior to issuance of the confirmation under regulation 7, transfer his shares in such recognised stock exchange to any person otherwise than in accordance with Chapter II. 9. Eligibility criteria for persons acquiring or holding more than 6 [five per cent.] equity shares in a recognised stock exchange.- 7 [(1) No person shall, directly or indirectly, either individually or together with persons acting in concert with him, acquire and/or hold more than five per cent. of the paid up equity capital of a recognised stock exchange after commencement of these regulations, unless he is a fit and proper person and has taken prior approval of the Board for doing so.] (2) For the purpose of sub-regulation (1), a person shall be deemed to be a fit and proper person if (i) such person has a general reputation and record of fairness and integrity, including but not limited to - (a) financial integrity; (b) good reputation and character; and (c) honesty. (ii) such person has not incurred any of the following disqualifications (a) the person or any of its whole time directors or managing partners has been convicted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Board disclosing the following on a quarterly basis within fifteen days from the end of each quarter:- (a) the names of ten largest shareholders along with the number of shares held by them and their percentage shareholding; (b) the names of the shareholders falling under regulation 8 who had acquired shares in that quarter; (c) the shareholding pattern in the recognised stock exchange in such format as may be specified by the Board. (3) The recognised stock exchange shall submit an undertaking confirming the compliance of the provisions of sub-regulation (1) to the Board on a quarterly basis within fifteen days from the end of each quarter. (4) Notwithstanding anything contained in this regulation, the Board may from time to time call for any information from the recognised stock exchange, any shareholder having trading rights or any transferee of shares held by such shareholder, under the provisions of Securities Contracts (Regulation) Act, 1956 and the Securities and Exchange Board of India Act, 1992 and the rules and regulations made thereunder. (5) Without prejudice to the provisions of the Companies Act, 1956, the recognised stock exchange shall mai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egulations, 2008 w.e.f. 23-12-2008. 3. Substituted by the Securities Contracts (Regulation) (Manner of Increasing and Maintaining Public Shareholding in Recognised Stock Exchanges) (Amendment) Regulations, 2008 w.e.f. 23-12-2008. Prior to its substitution, this sub-regulation read as under:- (1) No person shall, directly or indirectly, acquire or hold more than five per cent in the paid up equity capital of a recognised stock exchange at any time after commencement of these regulations: Provided that any person holding equity shares in a recognised stock exchange in excess of the limits specified in this regulation at the commencement of these regulations shall reduce his holding to ensure compliance with this regulation within the time specified in sub-section (8) of Section 4B of the Act or the time extended under the proviso thereto. 4. Inserted by the Securities Contracts (Regulation) (Manner of Increasing and Maintaining Public Shareholding in Recognised Stock Exchanges) (Amendment) Regulations, 2008 w.e.f. 23-12-2008. 5. Renumbered as sub-regulation (3) by the Securities Contracts (Regulation) (Manner of Increasing and Maintaining Public Shareholdin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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