One-Time relaxation with respect to validity of SEBI Observations issued by SEBI due to COVID-19

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1) The Security and Exchange Board of India (SEBI) issued a one-time relaxation with respect to the validity of SEBI Observations amid Coronavirus.

2) The Board under Section 11(1) of the Securities and Exchange Board of India Act, 1992, on Tuesday, extended the validity of regulatory approval for launching initial public offering and rights issues by six months from September 30, 2020 in the wake of the coronavirus pandemic.

“The step comes following representations from various industry bodies, the Securities and Exchange Board of India (SEBI),” a circular said.

3) The validity of SEBI’s observations, where the same have expired or will expire between March 1, 2020, and September 30, 2020, has been extended by 6 months from the date of expiry of such observation.

4) The regulator said that an issuer, whose offer document for (IPO), follow on public offer and rights issue is pending receipt of its observation, will be permitted to increase or decrease the fresh issue size by up to 50% of the estimated issue size without requiring to file a fresh draft offer document with the SEBI.

5) Under the norms, any increase or decrease in estimated fresh issue size by more than 20% of the estimated fresh issue size requires the fresh filing of the draft offer document along with fees.

6) The relaxation on change in fresh issue size will be applicable for offer documents pending receipt of SEBI observations until 31 December 2020.

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