Relaxation From Applicability Of Penal Provisions Under SEBI Master Circular For Non-Compliance With MPS Requirements

In light of the prevailing uncertain market conditions due to ongoing geopolitical tensions, SEBI has by way of a Circular No. HO/49/14/14(13)2026-CFD-POD2/I/8772/2026, dated April 7, 2026 (‘Circular’), granted a one-time relaxation from the applicability of penal provisions prescribed under the SEBI Master Circular dated July 11, 2023 for compliance with the provisions of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘LODR Regulations’) (‘Master Circular’), in respect of non-compliance with the Minimum Public Shareholding (‘MPS’) requirements.

1. Existing Framework: The Master Circular, inter alia, prescribes the procedure to be followed by recognised stock exchanges and depositories in respect of listed entities not complying with MPS requirements, including the levy of fines, freezing of promoter shareholding, and other consequential
2. One-time Relaxation from Penal Provision: SEBI has, granted a one-time relaxation from the applicability of penal provisions under the Master Circular for listed entities whose compliance with MPS requirements falls between April 1, 2026, and September 30, 2026. Accordingly, recognised stock exchanges and depositories have been advised not to take any penal action as envisaged under the Master Circular against such entities for non-compliance during this
3. Withdrawal of Penal Actions Already Initiated: The Circular clarifies that any penal actions already initiated against such entities between April 1, 2026, and the date of the Circular may be withdrawn.

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