To make sure only the serious promoters announce the buyback offer, Sebi has made it mandatory for companies to buy back at least 50 per cent of the proposed offer size and, failing to do so will attract a penalty of 2.5 per cent. Companies will also have to keep the 25 per cent buyback amount in a separate escrow account and complete the process within six months. Sebi has also decided that there will be a one-year cooling-off period between two buybacks and companies will not be allowed to raise funds during that period.
The market regulator also accepted the key recommendations of the Chandrasekhar panel on foreign investment route rationalisation. These included fewer routes for FIIs and simpler registration and KYC processes.
Sebi also announced a new trading platform-- the institutional trading platform (ITP)-- to enable listing and trading in start-ups and small & medium enterprises (SMEs) without having to go for a public offer or capital raising.