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SEBI has allowed for exemptions to promoters who do not have 100 per cent of their shareholding in demat form.
Companies in which the promoters have sold their shares in physical mode and such shares have not been lodged for transfer are exempted.
If matters concerning part or the entire shareholding of promoters or promoter groups are under consideration before any court or tribunal, then too the company is exempt.
Exemptions can also be made in cases where shares cannot be converted into demat form due to death of a promoter.
Cases where shares allotted to promoters are awaiting final approval for listing from stock exchanges can also be exempted. However, in such cases, the matter should be pending for less than 30 days.
In June 2011, SEBI asked all promoters to have 100 per cent of their shareholding in demat form. Friday's SEBI circular said that a large number of companies have complied with its earlier directive. However, it had received representations from various companies seeking exemption from such compliance.
sneha.p@thehindu.co.in
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