November 2023

Private Affairs Impacting Public Interest Entities - A Sift Through a Recent SEBI Amendment

Anand Bathiya | Prachi Naik
Chartered Accountants

The Primary Marked Advisory Committee (‘PMAC’) of the Securities and Exchange Board of India (‘SEBI’) had identified and deliberated on certain challenges and issues arising out of (i) agreements indirectly binding public listed entities, (ii) special rights granted to shareholders of a public listed entity, (iii) sale, disposal or lease of an undertaking of a listed entity and (iv) the provision for board permanency in the context of a public listed entity. Based on PMAC recommendations, SEBI released a Consultation Paper1 for public feedback, basis of which released a Board Memorandum2 and consequently, on 14th June, 2023 introduced certain amendments to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations’) under the SEBI (Listing Obligations and Disclosure Requirements) (Second Amendment) Regulations, 2023 (‘Listing Regulations Amendment’).3

1    Consultation Paper on 'Strengthening Corporate Governance at Listed Entities by Empowering Shareholders' on February 21, 2023.

2    Board Memorandum on ‘Strengthening corporate governance at listed entities by empowering shareholders - Amendments to the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015’ dated 17th April, 2023
3    The Listing Regulations Amendment came into force on July 14, 2023 (except certain specified amendments which will come into force on the date of their publication in the Official Gazette).

One of the key amendments under the Listing Regulations Amendment relates to approval and disclosure requirements for certain types of agreements indirectly binding listed entities. These agreements could be in the nature of family arrangements, trust deeds, settlement agreements, shareholder agreements, voting agreements, family charters, consent terms, etc. to which the listed entity may not have been privy or party.

In this article, our attention is directed toward analysing the disclosure requisites emanating from this particular facet of the amendment, accompanied by a critique exploration of the attendant complexities.


Regulation 30 of Listing Regulations relates to the disclosure of material events and information by a listed company to stock exchanges. Prior to the Listing Regulations Amendment, clause 5 of Para A of Part A of Schedule III of Listing Regulations covered a disclosure requirements as under:

Clause 5: Agreements [viz. shareholder agreement(s), joint venture agreement(s), family settlement agreement(s)] (to the exten


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