The Securities and Exchange Board of India
("SEBI") notified the SEBI (Issue of
Capital and Disclosure Requirements) (Seventh Amendment)
Regulations, 2015 ("ICDR Amendment") on
October 27, 2015, issuing general instructions and disclosures to
simplify the process for issuing an abridged prospectus for the
public issue of shares, amending the SEBI (Issue of Capital and
Disclosure Requirements) Regulations, 2009 ("ICDR
Regulations"). The ICDR Amendment will come to effect
on December 1, 2015. Pursuant to the ICDR Amendment, SEBI issued
the revised format for an abridged prospectus by a circular on
October 30, 2015 ("Circular").
Disclosures regarding abridged prospectus will only be made as per
the ICDR Amendment, in line with the Companies Act, 2013 and
disclosures under the erstwhile Companies Act, 1956 will no longer
be required. The list of disclosures to be made as per the ICDR
Amendment have been simplified to shorten the length of an abridged
Salient features of the ICDR Amendment are as follows:
1. Only information that is material and appropriate to enable
the investors to make an informed decision are to be disclosed in
the abridged prospectus;
2. An issuer desirous of making a public issue of shares will
have make disclosures as per the prescribed format issued by SEBI
from time to time, currently provided for in the Circular;
3. A copy of the abridged prospectus is to be submitted to SEBI.
General instructions for the preparation of the abridged prospectus
provides for the manner of printing, including usage of the
preferred font and its size;
4. Information that is to be submitted in a tabular format
should not appear in a running text format;
5. Generic information, not specific to the issuer is to be
mentioned in the General Information Document specified by SEBI
form time to time.
The ICDR Amendment looks to aid the investor, by curbing the
practice of submitting voluminous versions of the arbitraged
prospectus, which defeated the purpose of the same altogether. The
ICDR Amendment blog along with the Circular will direct issuers to
only disclose information that is relevant for the investor to make
an informed decision. Moreover, it was a welcomed move SEBI to
promptly issue the format for the arbitraged prospectus.
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The Ministry of Corporate Affairs notified on June 5, 2015 that certain provisions of the Companies Act, 2013 shall not apply to private limited companies or shall apply with such exceptions or modifications as directed in the notification.
Whilst trade and barter have existed since early times, the modern practice of forming business relationships through the means of contract has come into existence only since the industrial revolution in the West.
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