Capital market regulator Sebi on Tuesday introduced a framework for ‘scheme of arrangement’ by unlisted stock exchanges, clearing corporations and depositories.
A scheme of arrangement is a court-approved agreement between a company and its shareholders or creditors.
At present, there is no specific provision for unlisted Market Infrastructure Institutions (MIIs) — stock exchanges, clearing corporations and depositories — to file the draft scheme of arrangement with Sebi prior to filing the application before any court or tribunal.
Further, the process to be followed by unlisted MIIs in case of a scheme of arrangement is currently not specified.
Under the new framework, Sebi said that unlisted MII desirous of undertaking a scheme of arrangement will have to file the draft scheme of arrangement along with a non-refundable fee with the regulator for obtaining the observation letter or no-objection letter before filing such a scheme with any court or tribunal.
The provision may not
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