The Hindu Business Line : SEBI to move against cos delaying demat

THE Securities and Exchange Board of India (SEBI) working group on dematerialisation has decided to launch prosecution against companies delaying demat requests by investors.

The move is aimed at ensuring speedy dematerialisation of the securities. The group has also decided that both the depositories — CDSL and NSDL — must come out with the details of those companies delaying the demat requests.

In order to avoid delay in demat requests by companies, the market regulator has also decided to dispense with the in-house registrar and transfer work carried by the companies. This clause will not apply to those companies, which are having their own electronic connectivity.

With an increasing number of open offers by companies, the group has also decided that the acquirer (in the open offer) must bear the transaction cost while transferring the shares. "This will reduce the burden on the investors to the extent of transactions cost to be borne by them,'' the SEBI statement said.

The committee, which met on Friday, deliberated upon discontinuance of account closure charge and account transfer charge.

This issue would be finalised after the outcome of the sub-committee on `How to reduce the costs of the investors', chaired by NSDL Managing Director, Mr C.B. Bhave.

It was also stated that with the introduction of "trade-to-trade'' segment, trading for companies not having electronic connectivity has worked as a large number of companies have established the dematerialisation connectivity.

The total number of companies that have established the connectivity was around 4,500.

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SEBI to move against cos delaying demat