SEBI New Rule: Earlier in the month of May, SEBI had said that the details of all the folios will not be available after October 1, 2023. They will be frozen by the Issue and Share Transfer Agent Registrar.
SEBI i.e. Securities and Exchange Board of India has changed the rules giving relief to investors holding physical shares. After which trading will become easier. A circular has been issued regarding this. Now the provisions of KYC, PAN Card and freezing without nomination i.e. the provisions of ban on securities have been abolished. Which has also been implemented with immediate effect.
What was the rule earlier?
SEBI has taken this decision after feedback received from investors and Registrar Association of India. The rule in which the change has been made applies to all shareholders who hold physical shares of listed companies. It was mandatory for them to sign for contact details, nomination, PAN, bank account and folio number. Earlier all these documents were mandatory for placing a ban on securities.
Earlier in the month of May, SEBI had said that the details of all the folios will not be available after October 1, 2023. They will be frozen by the Issue and Share Transfer Agent Registrar. By amending the circular issued at that time, the word freeze was removed.
Why did SEBI change the rules?
SEBI has taken this decision to make share trading easier. So that the unexpected challenges faced by investors can be reduced. Earlier, when folios were frozen, investors faced many problems. But now after the feedback received from investors, SEBI took this decision.
SEBI said about its decision that this decision has been taken to eliminate the administrative challenges related to the Anti-Money Laundering Act, Benami Transactions (Prohibition) Act, 1988 and the suggestions received from the investors and the reports received from the Registrar Association.