SEBI has by way of its Notification dated November 14, 2022 amended the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘SEBI (LODR) Regulations’). The key changes are set out below:

i.    Amendment to Regulation 25 of SEBI (LODR) Regulations :

Regulation 25(2A) has been amended, validating the appointment of an independent director in a scenario where a special resolution for the appointment of an independent director fails to get the requisite majority of votes, but: (i) the votes cast in favour of the resolution exceed those cast against; and (ii) the votes cast by the public shareholders in favour of the resolution exceed those cast against, the appointment of such an independent director will be deemed to have been made.

Similarly, an independent director appointed pursuant to the abovementioned provisions of the newly amended Regulation 25 (2A) may only be removed if: (i) the votes cast in favour of the removal exceed those cast against, and (ii) the votes cast by the public shareholders in favour of the removal exceed those cast against.

ii.    Amendment to Regulation 32 of SEBI (LODR) Regulations :

A monitoring agency may now be appointed by a listed company to monitor the utilisation of proceeds of a preferential issue or qualified institutions placement as well. This was earlier only extended to monitor the utilisation of proceeds of a rights or public issue.

iii.   Insertion of Regulations 59A and 94A to SEBI (LODR) Regulations :

As per the newly inserted Regulation 59A, if a listed entity that has listed non-convertible debt securities or non-convertible redeemable preference shares, intends to undertake or is involved in a scheme of arrangement (‘Scheme’) under Sections 66 and 230-234 of the Companies Act, 2013, it must obtain a no-objection letter from the stock exchange(s) prior to filing the Scheme with the National Company Law Tribunal (‘NCLT’). For seeking the no-objection letter, such listed entity should submit the documents as set out in Circular No. SEBI/HO/DDHS/DDHS-RACPOD1/P/CIR/2022/156 dated November 17, 2022 issued by SEBI. SEBI has further clarified on December 9, 2022 that the aforementioned Circular will not apply to a Scheme which solely provides for an arrangement between a debt listed entity and its unlisted wholly owned subsidiary. However, such debt listed entity will be required to file the draft Scheme with the stock exchange(s) and disclose it on its website.

Further, as per the newly inserted Regulation 94A, pursuant to a listed entity applying for a no-objection letter from stock exchange(s), the designated stock exchange is required to submit the draft Scheme and the supporting documentation to SEBI.