Sebi’s LODR Regulations: Key Compliance Challenges For Listed Companies.
This article is written by Madhavendra Pratap Singh, pursuing LL. B (Hons.) from National Law University, Odisha.
The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("LODR Regulations") are the main regulations governing the conduct of listed companies in India. The LODR Regulations were introduced as a ‘reformative' piece of legislation to bring together disparate listing obligations under a single principles-based approach with the aim of introducing greater compliance architecture. Although this framework has good intentions, it suffers from a number of structural shortcomings in terms of definitional ambiguity, procedural inflexibility, and burdensome compliance, which makes compliance in practice a challenge, especially for smaller listed entities.
The paper then examines, through a doctrinal analysis, four key compliance areas (materiality-based event disclosure under Regulation 30, related party transactions under Regulation 23, subsidiary governance under Regulations 24 and 24A, and the qualification of independent directors under Regulation 17), in order to highlight the specific gaps in the law which are preventing the scheme of regulation from working effectively. The paper ends with specific recommendations for reforms to be made by SEBI and the legislature.
DISCLAIMER: The views and opinions expressed in this research article, submitted by students and/or other contributors in their personal capacity, are solely those of the author(s) and do not, in any manner whatsoever, reflect or represent the views, opinions, advice, or official position of PACTEDGE LEGAL LLP (“PACTEDGE”). PACTEDGE makes no representations or warranties, whether express or implied, as to the completeness, accuracy, reliability, or currency of any facts, data, analysis, or legal propositions contained herein and shall not, to the fullest extent permitted by applicable law, be liable for any loss, injury, damage, or consequence arising directly or indirectly from any reliance placed upon this publication. The entire contents of this research article, including without limitation its text, structure, compilation, selection and arrangement of material, are and shall remain the exclusive intellectual property of PACTEDGE LEGAL LLP, protected under applicable copyright and other intellectual property laws. No part of this publication may be copied, reproduced, stored in a retrieval system, transmitted, adapted, published, communicated to the public, distributed, or otherwise made available in any form or by any means, whether electronic, digital, mechanical, photocopying, recording or otherwise, nor shared or reposted on any platform or medium, without the prior written consent of PACTEDGE LEGAL LLP; any unauthorised use shall constitute infringement and may attract civil and/or criminal consequences, without prejudice to any other rights or remedies available to PACTEDGE LEGAL LLP in law or equity.
Comments