FAQs on Buy-Back of Securities Regulations 2018

| Last updated: 21 February 2021

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This document provides answers to frequently asked questions regarding the SEBI (Buy-back of Securities) Regulations, 2018. It clarifies various aspects of how companies can buy back their shares, including different methods like tender offers and open market purchases. The FAQs also cover shareholder resolutions, where to find information on buybacks, and the process for tendering shares, whether held in physical or dematerialised form. It further explains how acceptances are decided and the timelines for receiving intimations and payments.

These FAQs offer only a simplistic explanation/clarification of terms/concepts related to the SEBI (Buy-back of Securities) Regulations, 2018 [Buyback Regulations]. Any such explanation/clarification that is provided herein should not be regarded as an interpretation of law nor be treated as a bindi

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FAQ :

A company can buy back its shares through tender offers to existing shareholders on a proportionate basis, from the open market via book building or stock exchange mechanisms, or from odd lot holders.

Yes, a company can buy back up to 10% of its paid-up equity capital and reserves without a shareholder resolution. For buybacks exceeding this threshold, a special resolution from shareholders is required.

Information on companies proposing share buybacks can be obtained from stock exchanges, as listed companies must intimate them about general meetings and passed resolutions. Additionally, public announcements and offer documents filed with SEBI are uploaded on the SEBI website.

If your shares are in physical form, you need to approach your stockbroker with the complete set of documents as specified in the public announcement or letter of offer for verification. Your broker will then assist in placing the bid and submitting the necessary forms.

If you don't receive a tender/offer form, you can still participate by submitting a written application on plain paper to your stockbroker (for dematerialised shares) or directly to the registrar (for physical shares), providing all required details and documents.

The company is required to send an intimation to tenderers regarding the acceptance of their shares within 7 working days from the closure of the buyback offer.