SEBI notifies procedure for seeking prior approval for change in control of Vault Managers

The Securities and Exchange Board of India(SEBI) has notified procedure for seeking prior approval for change in control of Vault Managers via issuing Circular.

As per the procedure, Vault Managers must submit an application to SEBI for obtaining prior approval through the SEBI Intermediary Portal. The prior approval granted by SEBI shall be valid for a period of six months from the date of such approval. The circular shall be effective immediately for all applications seeking approval for change in control of Vault Manager.

The Circular Stated, “Regulation 8(b) of SEBI (Vault Managers) Regulations, 2021 was amended vide SEBI (Change in Control in Intermediaries) (Amendment) Regulations, 2023 dated January 17, 2023 which requires Vault Managers to obtain prior approval of the Board in case of change in control in suchmanner as specified by the Board.”

The procedure for obtaining prior approval in case of change in control of Vault Managers is specified as under:

An application shall be made by the Vault Managers to SEBI for prior approval through the SEBI Intermediary Portal (‘SI Portal’).

The application shall be accompanied by the following information/declaration about itself, the acquirer(s)/the person(s) who shall have the control and their directors/ partners:

a. Present and proposed shareholding pattern of the applicant

b. Whether any application was made in the past to SEBI by the acquirer/persons who shall have control seeking registration in any capacity but was not granted? If yes, details thereof.

c. Whether any action has been initiated/ taken for violation of the provisions of Securities Contracts (Regulation) Act, 1956/Securities and Exchange Board of India Act, 1992 / Depositories Act, 1996or rules and regulations made thereunder? If yes, the status thereof along with the corrective action taken to avoid such violations in the future. The acquirer/ the person who shall have the control needs to confirm that it shall honour all past liabilities / obligations of the applicant, if any.

d. Whether any investor complaint is pending? If yes, steps taken for resolution and confirmation that the acquirer/ the person who shall have the control shall resolve the same.

e. Details of litigation(s), if any.

f. Declaration of the applicant and the acquirer/ the person who shall have the control(in a format enclosed at Annexure), duly signed by their authorized signatories that the ‘fit and proper person’ criteria as specified in Schedule II of SEBI (Intermediaries) Regulations, 2008 are complied

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