INSIGHTS
SEBI: AMENDEMENTS TO BUYBACK REGULATIONS & THE TAKE OVER CODE
The latest
In its first board meeting this financial year, the SEBI Board passed sweeping amendments to the Takeover Code, Buy Back Regulations and IPO norms. Essentially aimed at easing procedural bottle necks and aligning the provisions of the Companies Act, 2013 the amendments are being seen as a welcome relief. A working paper of these draft amendments came to be circulated in April, 2018. The SEBI is in the process of issuing an official notification of the same.
The salient features of the amendments are enumerated here-below:
I. Takeover Regulations
The SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 were published in the Gazette of India on 23rd September, 2011. They were enacted with the objective of governing and regulating the direct and indirect acquisitions of shares or voting rights in, or control of the target company. Since then its provisions / regulations have been periodically amended up to now.
The SEBI Board has in its meeting held during this financial year proposed further amendments to the Takeover regulations. A look at some key amendments:
- The definition of “frequently traded shares” has been amended to mean the traded turnover during 12 calendar months preceding the calendar month in which the public announcement is required to be made , is at least 10% of the total number of shares of such class of the target company.
- Clause 1 (ma) has been inserted after the “listing Agreement: - “listing regulations” means the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.”
- The definition of postal ballot has been amended to mean postal ballot as provided for under Rule 22 of the Companies (Management and Administration) Rules, 2014 made under the Companies Act, 2013.”
- The Letter of Offer can be circulated electronically also.
- It has been decided to grant additional time for upward revision of open offer price. Now such upward revision can be done up to 1 working day before the commencement of the tender period.
- There have been various other provisions which have been amended to bring it in line with relevant provisions of the Companies Act, 2013.
II. Buyback Regulations
SEBI enacted the (Buy-back of Securities) Regulations, 1998 with the objective of aligning the provisions with the principle of equitable treatment to all shareholders and enhancing the efficiency in the Buyback process.
SEBI has proposed replacing SEBI (Buy-back of Securities) Regulations, 1998 with new SEBI (Buy-back of Securities) Regulations, 20181. A look at some of the key provisions:
- Applicability: These regulations shall apply to buyback of shares and other securities in accordance with provisions of the Companies Act, 2013
- Conditions: Click here
Analysis
Besides the above, the SEBI Board has resolved to discontinue the sub broker category and merge the category with Authorized persons or Trading members. Such amendments, both in the buy-back regulations as well as takeover code, is aimed at increased and transparent compliance and disclsoures by companies.
Note:
For the full text of the SEBI (Buy-back of Securities) Regulations, 2018 and the amendments to SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, please refer the link:
WHAT'S BREWING
ADULTERY: THE TRIANGLE OF LOVE
Earlier this month, the adultery laws in India was in the news – the Centre has asked for either the Law to be made gender neutral or altogether scrapped.
Section 497 of the Indian Penal Code (IPC) states that whosoever has physical relationship with the wife of another man, without the consent or connivance of that man, shall be punishable with imprisonment for 5 years or fine or both.
Adultery law - Where the Dichotomy is
The adultery law does not give any express right on women to prosecute the straying husband or the woman who is straying with the man. It is only the husband who can prosecute the straying man. Only the outsider to the marriage can be punished in the context of marriage. It essentially means that women cannot be prosecuted. Only the adulterous man shall be liable to be prosecuted.
Centre’s submission
The Centre represented before the Supreme Court that it favoured retention of adultery as an offence under the India Penal Code as adultery causes mental and physical injury to the family. Therefore it is not only an offence against an unsuspecting family but also an offence against the sanctity and institution of marriage in a society. Thus adultery should be made a criminal offence.
The Centre also urged the Supreme Court to make adultery laws gender neutral – making both the man and woman who stray from their marriage(s) guilty and punishable.
SC view
However, a 5 judge bench of the Supreme Court headed by the Chief Justice of India took a different view. They were unanimous in their opinion that this law is entirely based on gender discrimination. By treating the straying woman as a victim and the straying man as a criminal, the law is entirely unfair on the men. At the same time, by attaching consent of the married man in the matter of his wife having an extra marital affair, it implies that the wife is the “property” of the man and he has the power to control her physical requirements which is unfair on women. The Court viewed that while the criminal law is based on gender equality, this was absent in section 497 dealing with adultery. This is directly violative of Article 14 (Right to equality) of the Constitution.
The SC also held that in cases of marital discord with intention to legally separate, it may take years before a divorce is granted. By which time if the man and woman choose to move on with other partners, then that would be considered illegal. This is also restrictive especially if there is no scope of rapprochement of the marriage.
The apex court was also of the view that gender neutrality cannot make adultery as an offence. It does not cause public harm as neither adults accuse of abuse. While it (unfortunately) breaks down the institution of marriage, only remedies such a divorce can be opted for.
The SC is firmly of the view that the Victorian law on adultery must change according to time and be made more liberal given the ever changing social fabric and ethos.
Adultery in rest of the world
Countries that follow Islamic laws strictly prohibit adultery by imposing fines, imprisonment, flogging and even death. More than 20 states in the US view adultery as illegal. But in several such States the offence is treated as misdemeanour or felony mostly restricting penalties to fines.
All European nations – Italy, France, Span, Portugal, Switzerland, Luxemborg and many more have decriminalised adultery. In February, South Korea decriminalised adultery which had until then, penalised adultery with 2 years imprisonment. Even Latin America and Australia do no consider Adultery as an offence.
More than just law to govern infidelity
The debate is raging and seems endless. However, there is more to infidelity than just being governed by Law. Generally marriage is based on mutual agreement, trust and loyalty. More than the legal aspect, adultery destroys the emotional and physical wellbeing of an entire family especially children. Social ridicule and ostracization from society are unavoidable consequences. More than Victorian laws, self-governance is of utmost necessity.
THE VERDICT
FUNDAMENTAL RIGHTS OF THE DIFFERENTLY ABLED
- Landmark Judgment(s) by the Supreme Court of India
Rajive Raturi v. Union of India
Writ Petition (Civil) No. 243 of 2005 along with Writ Petition (Civil) No. 228 of 2006
In December, 2017, Division Bench of the Supreme Court has laid out express and elaborate directions aimed at making physical infrastructure at public places easily accessible to the visually disabled people. In particular, the Apex Court laid down 11 guidelines covering everything from roads, to railway stations and government websites. All this has to be completed by December, 2018. The SC laid down these guidelines, a first of its kind judgment while disposing off a petition filed by a visually disabled individual from Gurgaon. The Supreme Court has directed that 50% of all Government buildings of the National Capital and all State Capitals be made fully accessible by December, 2018.
Suggestion:
It may be considered to incorporate in the above judgment the 11 guidelines issued by the Supreme Court.
Disabled Rights Group v. Union of India
Writ Petition (Civil) No. 292 of 2006
In December, 2017, the Supreme Court directed all Government run educational institutions to reserve at least 5% of their seats for the disabled / differently abled. Measures by way of setting aside stipulated number of seats, providing physical infrastructure for easy accessing such educational institutions and pedagogy – teaching methods and facilities specific to the disability that will enable them learn effectively. Such compliance needs to be reported by such institutions to Authorities under the (then) newly enacted legislation - the Rights of Persons with Disabilities Act, 2016 (the ‘Disabilities Act, 2016’) which replaced the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation Act) 1995.
Note:
1. Both the above cases were the first as well as landmark judgments passed after the enactment of the Disabilities Act, 2016
2. Full text of the Judgement: Rajiv Raturi vs. UOI: Click here
3. Full text of the Judgement: Disabled Rights group v Union of India: Click here
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LEGAL-EASE
Ikrah
Complusion; especially constraint exercised by one person over another to do an illegal act, or to act contrary to his inclination.
Jurisdiction in rem
Power of court over a thing so that its judgement is valid as against the rights of every person in the thing, e.g a judgement or decree of registration of title to land.
Kernes
In english law, idlers; vagabonds.
Laden in bulk
A term in maritime law, applied to a vessel which is freighted with a cargo which is neither in casks, boxes,bales nor cases, but lies loose in the hold, being defended from wet or moisture by a number of mats and a quantity of dunnage.
INFOGRAPHIC
India Surrogates
A FEW GOOD MEN (1992) (Movie)
Adapted from a Broadway play of the same name, this 1992 American legal drama, deals with court martial of 2 U.S Marines who are accused of murdering their fellow marine while serving at Guantanamo “Gitmo” Naval base in Cuba. A Rookie Navy Lawyer Lt. Daniel Kaffe (Tom Cruise) who is (in) famous for plea bargains and out of court settlements is assigned the task of defending along with another senior lawyer Lt Cdr. Joanne Galloway (Demi Moore). The marines insist that they were acting under orders, something that Galloway is also convinced about. The truth unravels when the “no experience in courtroom” lawyer Kaffe becomes an astute cross examiner while taking on the mighty commander of Gitmo - Lt Col. Nathan Jessep (Jack Nicholson) and unravels the truth…straight from the horse’s mouth.
With powerful performances from a stellar cast of Demi Moore, Tom Cruise and Jack Nicholson, a few good men has to its credit, 4 nominations at the Academy awards and 5 golden globe award nominations. A must watch for legal drama lovers!
THEODORE KID LAWYER BOONE - JOHN GRISHAM (Book / Novel)
Published in 2010, this legal thriller from the master story teller John Grisham, is essentially for young children. Based on the central character of Theo, a 13 year old, this book is the first of the Theodre Boone series that was published between 2011 and 2016.
Theo’s parents are lawyers and all he ever wants to do when he grows up is become a trial court lawyer. However, he finds himself in court much earlier for a murder trial where knows only he knows the truth. Intriguing. An absolute page turner.
THE DEFENDERS (1961-1965) (TV Series)
An American Courtroom drama series that ran 4 seasons between 1961 and 1965, the TV series centred around a father –son duo who were lawyers and had a penchant for taking up some really interesting, controversial and complex issues such as civil rights issues, neo Nazis, personal religious faith affecting profession and the like. There was even an episode that defended an abortionist that seemed to have been the most controversial in its time. A sequel of sorts resurfaced in 1997 with newer characters of the family continuing the family legacy.
(P)REVIEW
Management is doing things right; leadership is doing the right things
- Peter Drucker
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