Context:
In its latest board meeting, SEBI introduced major relaxations to boost IPO participation, ease startup compliance, and support foreign fund flows into government securities. These steps also aid reverse flipping—startups shifting domicile back to India.
Key Announcements
- ESOP Retention for Startups
- Founders/promoters can retain ESOPs granted at least 1 year before filing DRHP.
- Fresh ESOP grants during IPO filing phase remain disallowed.
- Reverse Flipping & CCS Norms Relaxed
- Investors in fully paid CCS can now convert and sell shares without 1-year lock-in.
- Helps enable smoother Offer for Sale (OFS) during IPO.
- Promoter Contribution Rule Tweaked
- Shares held by foreign VCs, AIFs, and public financial institutions now count toward minimum promoter contribution.
- PSU Delisting Simplified
- PSUs where Govt or promoter group holds over 90% can now pursue delisting more easily.
- Foreign Portfolio Investors (FPIs)
- Compliance eased for FPIs investing solely in G-secs.
- Market Intermediaries Freed from Non-Core Carve-Outs
- Investment bankers, debenture trustees, custodians can now retain non-core activities, no longer required to hive them off.
- Settlement Scheme for Legacy Cases
- Scheme introduced for NSEL brokers and venture capital funds seeking to migrate under AIF regulations.
