No extension of deadline for minimum public shareholding: Sebi

Despite the volatile market conditions, all listed companies will be expected to comply with the minimum public shareholding norms by August 2013 as market regulator Securities Exchange Board of India (Sebi) has said that it will not extend the deadline.

"It is a completely wrong assumption and arguments that the three-year time frame given is too short a time frame," Sebi chairman UK Sinha said on Saturday, adding that the time frame has 'already crossed 11 years, definitely 6 years.'

Although Sebi came out with the guidelines for minimum public listing in late 2010, it had started discussions on the matter way back in 2001.

Under the norms, state owned firms must have a minimum public shareholding of 10 per cent and the private companies 25 per cent. These guidelines were to be complied within three years. While the private companies have to meet norms by June 2013, for PSUs the deadline is August 2013.

Questioning the argument that firms cannot meet the norms due to the choppy market conditions, Sinha said, "What have we done? I don't think it is anybody's case that market was not good in 2007, 2008, 2009 and 2010."

The finance ministry had also recently indicated that it would not pitch for an extension of the deadline.

Speaking at a seminar organised by PHDCCI, the Sebi chief said, "We have been receiving many representations. We have been telling them to follow the Sebi norms in letter and spirit. If you are only trying to do it in letter and not in the spirit of it, then Sebi is not going to be enthusiastic about it. We are examining those issues."

As on March this year, 193 companies were non-compliant with minimum public shareholding norms while 125 private entities had less than 20 per cent public shareholding, Sinha said. There were as many as 1,259 companies that did not submit their shareholding pattern as on March 2012, he said.

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