Zee Media : SEBI Circular - SOP for Dispute Resolution under the Stock Exchange arbitration mechanism

Availability of Dispute Resolution Mechanism at Stock Exchanges against Listed

Companies/ Registrar to an Issue and Share Transfer Agents (RTAs)

Dear Shareholder,

We would like to inform you that SEBI has introduced Arbitration Mechanism in Stock Exchange, for dispute redressal against Listed Company / Registrar to the Issue and Share Transfer Agents (RTA).

SEBI had vide its Circular SEBI/HO/MIRSD/MIRSD_RTAMB/P/CIR/2022/76 dated May 30, 2022 issued a Standard Operating Procedure (SOP) for dispute resolution under the stock exchange arbitration mechanism for disputes between a listed company and/or registrars to an issue and share transfer agents and its shareholder(s)/investor(s).

If you have any dispute against a listed company and or its Registrar and Share Transfer Agent (RTA) on delay or default in processing your request, as per SEBI circular dated May 30, 2022, you can file for arbitration with Stock Exchange.

For more details, please see the web links of the stock exchanges-

BSE -http://tiny.cc/m1l2vz

NSE -http://tiny.cc/s1l2vz

We would also like to once again bring to your attention that SEBI vide its circular SEBI/HO/MIRSD/MIRSD_RTAMB/P/CIR/2021/655 dated November 03, 2021 has mandated that all the folios have to be KYC compliant and accordingly, asked the investors to register their PAN, KYC details and Nomination with the RTAs. SEBI has also directed that RTAs shall not process any service requests or complaints received from the holder(s) / claimant(s) till PAN, KYC and Nomination documents/details are registered. Hence we request you to please register/update your PAN, KYC and Nomination details with our RTA, if not already done. For more information visit https://www.linkintime.co.in -> Resources -> Downloads -> KYC -> Formats for KYC.

Thanking you,

Yours faithfully,

Link Intime India Private Limited (RTA) on behalf of Issuer Company

Encl: SEBI Circulars issued in this regard

CIRCULAR

SEBI/HO/MIRSD/MIRSD_RTAMB/P/CIR/2022/76

May 30, 2022

To

All Recognized Stock Exchanges

All registered Registrars to an Issue and Share Transfer Agents (RTAs) All Listed Companies through Recognized Stock Exchanges

Dear Sir / Madam,

Subject: Standard Operating Procedures (SOP) for dispute resolution under the Stock Exchange arbitration mechanism for disputes between a Listed Company and/or Registrars to an Issue and Share Transfer Agents (RTAs) and its Shareholder(s)/Investor(s)

1. Regulation 40 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and bye-laws, listing agreement & regulations of the stock exchanges provide for dispute resolution under the stock exchange arbitration mechanism for disputes between a listed company and its shareholder(s)/ investor(s).
2. SEBI vide circular dated April 08, 2022 advised Exchanges to put in place a Standard Operating Procedure (SOP) for operationalizing the resolution of all disputes pertaining to or emanating from investor services such as transfer/transmission of shares, demat/remat, issue of duplicate shares, transposition of holders, etc. and investor entitlements like corporate benefits, dividend, bonus shares, rights entitlements, credit of securities in public issue, interest /coupon payments on securities, etc.
3. In partial modification to the above circular, and after consultation with the stock exchanges/ Registrar and Share Transfer Agents (RTAs), the SOP to be followed is as under-
   3.1. Applicability
4. 1. The provisions of SOP shall be applicable to Listed Companies / RTAs offering services on behalf of listed companies. In case of claims or disputes arising between the shareholder(s)/ investor(s) of listed companies and the RTAs, the RTAs shall be subjected to the stock exchange arbitration mechanism. In all such instances, the listed company shall necessarily be added as a party.
   2. The Arbitration Mechanism shall be initiated post exhausting all actions for resolution of complaints including those received through SCORES Portal. The Arbitration reference shall be filed with the Stock Exchange where the initial complaint has been addressed.

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1. Maintenance of a Panel of Arbitrators and Code of Conduct for Arbitrators

1. The maintenance of Panel of Arbitrators and the Code of Conduct for Arbitrators shall be in line with the current norms being followed by the Stock Exchanges for arbitration mechanism.

1. Arbitration

1. The limitation period for filing an arbitration application shall be as prescribed under the law of limitation, i.e., The Limitation Act, 1963.
2. In case of arbitration matters involving a claim of up to Rs. 25 lakhs, a sole arbitrator shall be appointed and, if the value of the claim is more than Rs. 25 lakhs, a panel of three arbitrators shall be appointed.
3. The process of appointment of arbitrator(s) shall be completed by the stock exchange within 30 days from the date of receipt of complete application from the applicant.
4. Disputes pertaining to or emanating from investor service requests such as transfer/transmission of shares, demat/remat, issue of duplicate shares, transposition of holders, investor entitlements like corporate benefits, dividend, bonus shares, rights entitlements, credit of securities in public issue, interest /coupon payments on securities and delay in processing/wrongful rejection of aforesaid investor service requests may be considered for arbitration.

1. Appellate Arbitration

1. Any party aggrieved by an arbitral award may file an appeal before the appellate panel of arbitrators of the stock exchange against such award within one month from the date of receipt of arbitral award by the aggrieved party.
2. The appellate panel shall consist of three arbitrators who shall be different from the one(s) who passed the arbitral award appealed against.
3. The process of appointment of appellate panel of arbitrator(s) shall be completed by the stock exchange within 30 days from the date of receipt of complete application for appellate arbitration.

1. Arbitration Fees

1. The fees per arbitrator shall be Rs. 18,000/- plus stamp duty, service charge etc. as applicable per case. The fees plus stamp duty, service charge etc. as applicable shall be collected from RTAs/ Listed companies and shareholder(s)/ investor(s) separately by the Exchange, for defraying the cost of arbitration.
2. If the value of claim is less than or equal to Rs.10 lakhs, then the cost of arbitration with respect to the shareholder(s)/investor(s) shall be borne by the Exchange.
3. Further on passing of the arbitral award, the fees and stamp charges paid by the party in whose favor the award has been passed would be refunded and the fees and stamp charges of the party against whom the award has been passed would be utilized towards payment of the arbitrator fees.

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