Sebi Proposes Regulatory Overhaul for Unclaimed Securities

The Securities and Exchange Board of India (Sebi) has unveiled a proposal aimed at aligning regulations concerning non-convertible securities with the mandates of the Companies Act, 2013. This crucial regulatory overhaul intends to standardize the process of addressing unclaimed amounts associated with matured securities.

One of the main proposals in Sebi's consultation paper involves amending the Listing Obligations and Disclosure Requirements (LODR) to coincide with the existing Companies Act and the Investor Education and Protection Fund (IEPF) Rules. Currently, there is a discrepancy in the transfer process of unclaimed interest between the frameworks established by the LODR and the Companies Act.

Sebi's proposed amendments will ensure consistency by mandating that unclaimed amounts are moved to the IEPF after seven years from the maturity date of the securities. Public comments are welcomed, with a deadline set for November 14. Investors stand to benefit from increasing clarity and ease of claiming amounts directly within the seven-year timeframe.