Streamlining the process of public issues and redressal of investor grievances

SEBI/HO/CFD/DIL2/CIR/P/2022/51 April 20, 2022 To Recognized Stock Exchanges Registered Stock Brokers Registered Merchant Bankers Registered Registrars to an Issue and Share Transfer Agents Depositories and Registered Depository Participants Registered Bankers to an Issue Self Certified Syndicate Banks (SCSBs) National Payments Corporation of India (NPCI) Dear Sir / Madam, Sub: Streamlining the Process of Public Issues and redressal of Investor grievances 1. SEBI vide Circular No. SEBI/HO/CFD/DIL2/CIR/P/2021/2480/1/M dated March 16, 2021 (hereinafter referred to as “the March’21 Circular”), which came into effect from May 01, 2021, had put in place measures to have a uniform policy to further streamline the processing of the ASBA applications through UPI process among intermediaries/SCSBs. 2. Vide Circular dated June 02, 2021, the implementation timelines for certain provisions of the Circular were deferred. Redressal of Investor grievances 3. The Circular provided a mechanism of compensation to investors for delay in unblocking of application amounts by SCSBs and has prescribed certain compliance and reporting standards to be adopted by SCSBs. 4. The performance of SCSBs on timely unblocking of application amounts has been reviewed and based on the feedback received from market intermediaries, a new reporting format for Annexure IV of the March’21 Circular has been devised to capture the data of all ASBA applications unblocked by SCSBs and their corresponding date of actual unblock. SCSBs shall submit the Annexure IV of the March’21 Circular in the format prescribed in Annexure IV of this circular. 1 | Pag e5. It is reiterated that the SCSBs shall continue to compensate the investors for delays in unblocking of application amounts as per the compensation clause provided in the March’21 Circular. 6. The compensation prescribed in the March’21 Circular shall be applicable to all ASBA applications processed by the SCSBs. 7. Paragraphs 13 and 14 of the March’21 Circular stand modified to the extent stated above. Payment of Processing Fee to SCSBs 8. To claim the processing fee, SCSBs shall make an application to the Merchant Bankers in the format prescribed in Annexure I of this circular (complete with requisite information mentioned therein) with a copy to the Registrar to the Issue, subject to the following conditions: a) The application shall be made no later than 30 days from the finalization of basis of allotment by Registrar to the Issue. b) The SCSBs shall make the application only after (i) unblocking of application amounts for each application received by such SCSB has been fully completed; (ii) applicable compensation relating to investor complaints has been paid by the SCSB. 9. The SCSBs shall continue to be responsible to provide information requested by the Merchant Bankers/ Registrar to the Issue/ Issuer and also remain liable to pay compensation applicable as per the Circular (including any amendments thereof), for delays in unblocking of application amounts after the processing fee has been claimed by the SCSBs. 10. Needless to state that SCSBs are liable to face appropriate action under Securities Laws for non-compliance with the requirements of this circular. SMS Alerts to Investors 11. The March’21 Circular has made provisions of sending timely information to investors through SMS Alerts for blocking and unblocking of application amounts. With regard to UPI applications, NPCI had approached SEBI with a proposal to include Invoice in the Inbox as one of the options for ensuring timely information to investors. 12. Accordingly, it has been decided that the SCSBs/UPI Apps eligible for Public Issues shall send SMS Alerts to Investors for all ASBA applications and may also provide the Invoice in the Inbox as an additional feature to verify the UPI mandate details. The SMS/Invoice in the Inbox shall include the details as prescribed in Annexure II. 2 | Pag e13. Para 9 of the March’21 Circular and para 3.1 of the circular dated June 02, 2021 shall stand modified to the extent stated above. 14. This circular shall come into force with immediate effect. The provisions of this circular shall become part of the offer documents, DRHP and RHP. 15. This circular is being issued in exercise of the powers under section 11 read with section 11A of the Securities and Exchange Board of India Act, 1992. 16. This circular is available on SEBI website at www.sebi.gov.in under the categories “Legal Framework” and “Issues and Listing”. Yours faithfully, Vandana Joglekar Deputy General Manager +91-22-26449639 vandanaj@sebi.gov.in 3 | Pag eFormat for Annexure – IV Name of the IPO______________________________________________________ Banker to the Issue____________________________________________________ Registrar to the Issue___________________________________________________ CERTIFICATION OF COMPLIANCE BY SCSBs FOR COMPLETION OF UNBLOCK OF FUNDS ON THE NEXT WORKING DAY FROM THE FINALIZATION OF BASIS OF ALLOTMENT BY REGISTRAR TO THE ISSUE (BOA+1). Note: All SCSBs are required to submit to the Lead Managers and Registrar to the Issue a certificate as per the format provided hereunder by the end of closing hours of Bank Day on BOA+1. Upon receipt of this certificate, the Registrar to the Issue shall maintain a record of the same and the consolidated compliance of all SCSBs shall be provided by the Registrar to the Issue to Post Issue Lead Manager on BOA+1. The Post Issue Lead Manager shall provide the same to SEBI as and when it is sought. Format of certificate to be submitted by SCSBs for Unblocking of Application Monies 1. We, [Name of the Bank], hold a valid certificate of registration as a Banker to an Issue under the SEBI (Bankers to an Issue) Regulations, 1994. Our SEBI registration number is _____________________valid up to_______________. 2. The summary of applications processed in the Public Issue of __________________is provided below. Mode of No. of Total No. of Total Date of ASBA Applications Amount (in Applications Amount (in Actual application Crores) Processed for Crores) Unblock* submission Unblocking Bank Online UPI (online) UPI (offline, if any) – as provided by RTI. * For the purposes of the above summary reporting, if date of unblock is not same for all the applications received by an SCSB, then the date of unblocking should be the date when the last application was unblocked. 4 | Pag e3. We have enclosed a data file of all ASBA applications unblocked by us in the format specified below:- Mode of ASBA applicatio n submissio Date of Date of n (Bank, Unbloc BOA+1 Actual S. Issuer Applicant Application Online, king (in Unblock No. Name Name No. UPI Amount DD/MM/ (DD/MM (online), (Rs.) YYYY /YYYY) UPI format) (offline, if any) – as provided by RTI) 4. Further, as on _____________________(BOA+1 Date),  We hereby confirm that we have completed the unblocking of all ASBA applications for non-allottees/ partial-allottees/ withdrawn/ cancelled/ deleted cases.  We hereby confirm that there are no multiple amounts blocked in investor’s account for a unique ASBA application.  We hereby confirm that the bank has not blocked funds in excess of the application amount in any of the investor’s account. 5. We are responsible for any investor grievances/complaints pertaining to blocking/unblocking of application amounts while discharging our role as envisaged in the ASBA facility. Authorized/Nodal official of the SCSB  Name –  Designation –  Mobile Number –  Email Id –  Contact Address – Signature & Stamp of the Authorized/Nodal official. 5 | Pag eAnnexure – I Name of the IPO______________________________________________________ Banker to the Issue____________________________________________________ Registrar to the Issue___________________________________________________ APPLICATION FOR RELEASE OF PROCESSING FEE TO BE MADE BY SCSB TO THE MERCHANT BANKERS NOT LATER THAN 30 DAYS FROM THE FINALIZATION OF BASIS OF ALLOTMENT (BOA) BY REGISTRAR TO THE ISSUE. Note: In order to claim the processing fee, all SCSBs are required to submit to the Merchant Bankers, with a copy to Registrar to the Issue, an application as per the format provided hereunder (complete with requisite information mentioned herein) not later than 30 days from BOA. Format of application to be submitted by an SCSB to Merchant Bankers for release of Processing Fee payable to the SCSB. 1. We, [Name of the Bank], hold a valid certificate of registration as a Banker to an Issue under the SEBI (Bankers to an Issue) Regulations, 1994. Our SEBI registration number is _____________________valid up to_______________. 2. We hereby submit our application for release of the processing fee payable to us amounting to Rs. ______________. We attach the workings relating to the aforementioned estimate of processing fee/ selling commission. 3. We confirm that all unblocking of ASBA application amounts at our end is fully completed. We have enclosed a data file of all ASBA applications unblocked by us in the format specified below: Mode of ASBA application Date of submission Date of Unblocki BOA+1 (Bank, Online, Actual S. Issuer Applicant Application ng (in UPI (online), Unblock No. Name Name No. Amount DD/MM/Y UPI (offline, if (DD/MM/Y (Rs.) YYY any) – as YYY) format) provided by RTI) 6 | Pag e4. We further confirm that we have paid all applicable compensation relating to investor complaints in terms of the requirements of applicable SEBI circulars including SEBI circular dated March 16, 2021. We have enclosed a data file of all ASBA applications for which we have paid applicable compensation in the format specified below:  Format A: Compensation for delayed unblock for cancelled/ withdrawn/ deleted applications (Refer to Schedule I) [Enter ‘Nil’ if not applicable]  Format B: Compensation for blocking of multiple amounts for the same UPI Application (Refer to Schedule II) [Enter ‘Nil’ if not applicable]  Format C: Compensation for blocking more amount than the application amount (Refer to Schedule III) [Enter ‘Nil’ if not applicable]  Format D: Compensation for delayed unblock for non-allotted/ partially-allotted applications (Refer to Schedule IV) [Enter ‘Nil’ if not applicable] 5. We undertake to provide requisite information/ explanations that maybe requested by the Merchant Bankers/ Registrar to the Issue/ Issuer in connection with the information provided by us in this application. 6. We acknowledge that we will continue to be responsible to provide information requested by the Merchant Bankers/ Registrar to the Issue/ Issuer and also remain liable to pay applicable compensation, for delays in unblocking of application amounts after the processing fee has been claimed by us for this issue. We are responsible for any investor grievances/ complaints pertaining to blocking/ unblocking of application amounts while discharging our role as envisaged in the ASBA facility. Authorized/ Nodal official of the SCSB  Name –  Designation –  Mobile Number –  Email Id –  Contact Address – Signature & Stamp of the Authorized/ Nodal official. 7 | Pag eSchedule I – Format for provision of information on compensation for delayed unblock for cancelled/ withdrawn/ deleted applications Mode of Date on which ASBA request for application cancellation/ Mode of submission withdrawal/ Date of payment of (Bank, Application Date of receipt deletion is Date of Actual Compensation payment of Issuer Applicant Application Compensation S.No. Online, UPI Amount of complaint placed in Unblock paid by SCSB Compensation Name Name No. (direct credit/ (online), (Rs.) (DD/MM/YYYY) Stock (DD/MM/YYYY) (Rs.) by SCSB IMPS/ RTGS/ UPI (offline, Exchanges (DD/MM/YYYY) NEFT etc.) if any) – as Bidding provided Platform by RTI) (DD/MM/YYYY) Schedule II - Format for provision of information on compensation for blocking of multiple amounts for the same UPI Application Mode of ASBA Total application cumulative Mode of submission blocked Date on which Date of payment of (Bank, amount Date of receipt multiple Date of Actual Compensation payment of Issuer Applicant Application Compensation S.No. Online, UPI less the of complaint amounts were Unblock paid by SCSB Compensation Name Name No. (direct credit/ (online), original (DD/MM/YYYY) blocked (DD/MM/YYYY) (Rs.) by SCSB IMPS/ RTGS/ UPI (offline, application (DD/MM/YYYY) (DD/MM/YYYY) NEFT etc.) if any) – as amount provided (Rs.) by RTI) Schedule III - Format for provision of information on compensation for blocking more amount than the application amount Mode of ASBA application Date on which Blocked Mode of submission the funds to Date of Amount payment of (Bank, Date of receipt the excess of Date of Actual Compensation payment of Issuer Applicant Application less Compensation S.No. Online, UPI of complaint application Unblock paid by SCSB Compensation Name Name No. Application (direct credit/ (online), (DD/MM/YYYY) amount were (DD/MM/YYYY) (Rs.) by SCSB Amount IMPS/ RTGS/ UPI (offline, blocked (DD/MM/YYYY) (Rs.) NEFT etc.) if any) – as (DD/MM/YYYY) provided by RTI) 8 | Pag eSchedule IV - Format for provision of information on compensation for delayed unblock for non-allotted/ partially-allotted applications Mode of ASBA application Mode of submission Date of payment of (Bank, Application Date of receipt Date of Date of Actual Compensation payment of Issuer Applicant Application Compensation S.No. Online, UPI Amount of complaint BOA+1 Unblock paid by SCSB Compensation Name Name No. (direct credit/ (online), (Rs.) (DD/MM/YYYY) (DD/MM/YYYY) (DD/MM/YYYY) (Rs.) by SCSB IMPS/ RTGS/ UPI (offline, (DD/MM/YYYY) NEFT etc.) if any) – as provided by RTI) Note: For calculation of compensation, the table mentioned at scenario in Para 15 of the Circular dated March 16, 2021 may be read as follows. Compensation by SCSBs Compensation by Post Issue Lead Manager Rs.100/- per day or 15% per annum Rs.100/- per day or 15% per of the application amount, annum of the application whichever is higher. amount, whichever is higher. Duration : November 06, 2020 to Duration : November 25, 2020 to November 30, 2020 November 30, 2020 9 | Pag eAnnexure II For SMS S.No. Scenarios Details to be present in SMS 1 Blocking of ASBA  Name of the IPO Application  Application Amount Amounts through  Date on which amount was blo cked. Bank, Online and UPI channels 2 Debit and For Full Allotment: unblocking of  Name of the IPO ASBA Application  Amount to be debited. Amounts through  Date on which amount was debited. Bank, Online and For Partial Allotment: UPI channels  Name of the IPO  Amount to be debited and unblocked.  Date on which amount was debited and unblocked. For Non Allotment:  Name of the IPO  Amount to be unblocked.  Date on which amount was unblocked. For UPI Mandates - Invoice in the Inbox S.No. Details to be available for Details to be available for mandate block. mandate Debit and Unblock. 1 Name of the IPO Name of the IPO 2 Application Number Application Number 3 DP ID & Client ID DP ID & Client ID 4 Number of shares (Bid Qty) Number of shares (Bid Qty) 5 Highest Bid Amount Amount Blocked 6 Date and Time of Bidding Number of shares allocated 7 - Amount to be debited 8 - Amount to be unblocked 9 - Date of Initiation 10 | Pag e