Relaxations granted by sebi and irda on account of covid-19 pandemic

Compliances have taken a backseat during the ongoing lockdown due to Covid-19 pandemic. Regulatory authorities have granted several relaxations to assist businesses to cope with the unprecedented lockdown and economic distress. We discuss herein below a few relaxations granted by the Securities and Exchange Board of India and the Insurance Regulatory and Development Authority of India to ease the compliance distress of the companies.

Relaxations by Securities and Exchange Board of India (SEBI): 

Relaxation for Disclosure Filings under the SEBI Takeover Regulations: SEBI has relaxed the timelines for disclosure filings required to be made under the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (“Takeover Regulations”) vide circular dated March 27, 2020. In terms of regulations 30(1), 30(2) and 30(4) of the Takeover Regulations, the shareholders of a company are required to compile, collate and disseminate information of their consolidated shareholding, as on March 31, 2020, to the company as well as to the stock exchange. In view of the Covid-19 pandemic, the due date for the said disclosure filings has been extended to June 1, 2020. 

Extension of Timelines under the Alternative Investment Fund (“AIF”) Regulations: In terms of the circular issued by SEBI on March 30, 2020, SEBI has extended the due date for regulatory filings for AIFs and venture capital funds, for the period ending March 31, 2020 and April 30, 2020, by two months over and above the timelines prescribed under the SEBI (Alternative Investment Fund) Regulations, 2012. 

Extension of Implementation of the Stewardship Code: SEBI in its circular dated December 24, 2019 had introduced a Stewardship Code for all mutual funds and all categories of AIFs, in relation to their investment in liquid entities. The said Stewardship Code was due to come into effect from April 1, 2020. Upon consideration of the representations received from the Association of Mutual Funds of India and the Indian Association of Alternative Investment Funds, on account of the Covid-19 pandemic, SEBI vide circular dated March 30, 2020, extended the timeline for implementation of the Stewardship Code from April 1, 2020 to July 1, 2020. 

Relaxation under LODR Regulations: SEBI vide circulars dated March 19, 2020, March 23, 2020 and March 26, 2020 has provided relaxation from compliances under certain provisions of the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 (“LODR Regulations”), as listed below.

 

Requirement	Relaxation
Compliance certificate on share transfer facility [Regulation 7(3)]	The due date for filing the half-yearly compliance certificate on share transfer facility has been extended from April 30, 2020 to May 31, 2020.
Statement of investor complaints [Regulation 13(3)]	The due date for filing the quarterly statement of investor complaints has been extended from April 21, 2020 to May 15, 2020.
Meetings of committees [Regulations 19(3A), 20 (3A) and 21 (3A)]	An extension of 3 months has been granted for meeting the requirement of holding at least one meeting a year of the nomination and remuneration committee, stakeholders’ relationship committee and risk management committee. This requirement can now be met by June 30, 2020.
Secretarial compliance report (Regulation 24A read with circular dated 8 February 2019)	The due date for filing the annual secretarial compliance report has been extended from May 30, 2020 to June 30, 2020.
Corporate governance report [Regulation 27(2)]	The due date for filing the quarterly corporate governance report has been extended from April 15, 2020 to May 15, 2020.
Shareholding pattern (Regulation 31)	The due date for filing the quarterly shareholding pattern has been extended from April 21, 2020 to May 15, 2020.
Quarterly/ Annual financial results (Regulation 33)	The due date for filing the quarterly financial results has been extended from May 15, 2020 to June 30, 2020.   The due date for filing the annual financial results has been extended from May 30, 2020 to June 30, 2020.
Certificate on issuance of share certificates [Regulation 40(9)]	The due date for filing the certificate from a practicing company secretary on timely issuance of share certificates has been extended from April 30, 2020 to May 31, 2020.
Exemption for publication of advertisements (Regulation 47)	The requirement of publishing information such as notice of the board meeting, financial results etc., in the newspapers has been exempted for all events scheduled till May 15, 2020.
Holding AGMs of top 100 listed companies [Regulation 44(5)]	The due date for holding the annual general meetings of the top 100 listed companies by market capitalization (determined as of 31 March of each financial year) has been extended from August 31, 2020 to September 30, 2020.
Half-yearly/ annual financial results [Regulations 52(1) and 52(2)]	The due date for filing the half yearly financial results of companies which have issued listed Non-Convertible Debentures/Non-Convertible Redeemable Preference Shares/Commercial Papers, has been extended from May 15, 2020 to June 30, 2020.   The due date for filing the annual financial results of companies which have issued listed NCDs/ NCRPS/ CPs has been extended from May 30, 2020 to June 30, 2020.

 Relaxations by Insurance Regulatory and Development Authority of India (IRDA):

Submission of Returns by Insurers – In view of the Covid-19 pandemic, the IRDAI vide circulars dated April 4, 2020 has granted additional time to all insurers for submission of regulatory returns to be submitted as at March 31, 2020. Fifteen days additional time has been granted for submission of monthly returns and 30 days additional timeline has been granted for submission of quarterly, half-yearly and yearly returns and cyber security audit. The timeline for submission of monthly and quarterly returns for the month of March 2020 by insurers and insurance intermediaries under the relevant regulations has been extended by a period of 15 days.

Submission of Returns by Insurance Intermediaries: For the regulatory returns which are required to be filed by insurance intermediaries, IRDAI vide circular dated April 9, 2020 has allowed 30 days additional time for submission of half-yearly and yearly returns and cyber security audit.

Submission of Final Re-insurance Programme – In compliance with the regulations, insurers are required to file their respective board approved final re-insurance programme for the financial year 2020-21 by April 30, 2020 along with a synopsis of catastrophe modelling report. The timeline for submission of the board approval re-insurance programme has been extended till May 31, 2020, vide IRDIA circular of March 28, 2020.

Relaxations for Policy Holders – IRDAI vide notification dated April 1, 2020 has directed the health insurers to permit the policy holders, whose policies are due to be renewed between March 25, 2020 to April 14, 2020, to pay the premium for renewal of their respective policy on or before April 21, 2020 and the health insurers have been directed to ensure continuity of health insurance cover from the date on which the policy falls due for renewal.

Similarly, even if the motor vehicle third party insurance is due to be renewed during the period from March 25, 2020 to April 14, 2020, the insurers have been directed to allow the policy holders to pay the premium on or before April 21, 2020 and ensure continuity of the statutory motor vehicle third party insurance cover from the date on which the policy falls due for renewal.

For more Covid 19 related legal updates, please refer to https://lexcounsel.in/newletters/newsletters-2020/ and for Covid 19 related articles, please refer to https://lexcounsel.in/articles-2020/