Changes in the regulatory framework for related party transactions, scheme of arrangement by listed companies and alternative investment funds

Disclosure obligations of listed entities in relation to Related Party Transactions (RPT) – Key changes include the following:

• Details of information required to be placed before the audit committee of the company and the shareholders for consideration of RPTs; and
• Revised format for bi-annual disclosures of RPTs by listed entities.
• Framework for Scheme of Arrangements filed by listed entities

• Valuation report to be accompanied with declaration by the listed entity on occurrence of any material events during the intervening period of filing the scheme documents with stock exchange and period under consideration for valuation;
• Declaration to be submitted on any past defaults of listed debt obligations of the entities forming part of the scheme;
• No Objection Certificate from the lending scheduled commercial banks/ financial institutions/ debenture trustees;
• Sale of fractional entitlements held by nominated trust and reporting thereof.

Clarifications regarding concentration norms under SEBI (Alternative Investment Funds) Regulations, 2012 (AIF Regulations)

• Calculation of investment limit of Category-III AIFs; and
• Requirement to appoint a custodian in cases of co-investment.

The aforesaid changes have been analysed in the attached file.

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