SEBI Grants One-Time Relief from MPS Compliance Penalties Amid Market Volatility:

SEBI Grants One-Time Relief from MPS Compliance Penalties Amid Market Volatility The Securities and Exchange Board of India has recently issued a circular giving a one-time relaxation to listed entities and companies facing challenges in meeting Minimum Public Shareholding (MPS) requirements as per the prescribed rules. The decision was made after industry representations highlighted difficulties due to ongoing geopolitical tensions in the Middle East and resulting market volatility. Under the earlier Master Circular dated July 11, 2023, strict penal provisions were prescribed for non-compliance with MPS requirements, including fines, freezing of promoter shareholding, and other enforcement actions. However, taking into account current market conditions, SEBI has decided to ease these compliance pressures temporarily. SEBI has granted a one-time relaxation of penal provisions under the Master Circular for listed entities whose deadline to meet MPS norms falls between April 1, 2026 and September 30, 2026. During this period, Stock exchanges and depositories shall not initiate any penal action for MPS non-compliance. Any penal actions already started from April 1, 2026, onwards must be withdrawn. The circular is effective immediately, and stock exchanges have been directed to do the following:

• Inform all listed entities and publish the circular on their websites.
• Amend relevant bye-laws and regulations, if required, to implement the relaxation.

This relief aims to provide breathing space to companies struggling to dilute promoter holdings due to the unstable market conditions. To Read the Full Circular, Click Here