Issue of No Objection Certificate for release of 1% of Issue amount

Last updated: 09 July 2021

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The Securities and Exchange Board of India (SEBI) has updated its guidelines regarding the No Objection Certificate (NOC) for the release of 1% of the issue amount. The time period for companies to apply for this NOC after listing has been reduced from 4 months to 2 months. This change is conditional on all issue-related complaints being resolved by the merchant banker and issuer. Additionally, merchant bankers must now provide a certificate confirming that all ASBA accounts have been unblocked.

Securities and Exchange Board of India

CIRCULAR

SEBI/HO/OIAE/IGRD/CIR/P/2021/588

05 July, 2021

To,
All companies whose securities are listed on SEBI recognized Stock Exchanges (through
Stock Exchanges)
All recognized Stock Exchanges
All registered Merchant Bankers

Dear Sir/ Madam,

Sub: Issue of No Objection Certificate for release of 1% of Issue amount

1. Please refer to Circular No. CIR/OIAE/1/2009 dated November 25, 2009, where in SEBI had laid down guidelines for obtaining NOC for release of 1% of issue amount. As per point 2 of the said circular, the issuer company is required to submit an application on its letter head addressed to SEBI in the format specified in Annexure – A, after lapse of 4 months from listing on the Exchange which was the last to permit listing, for the purpose of obtaining the NOC.

2. It has been decided to reduce the time period after listing for submitting the application to 2 months from the existing period of 4 months as stated in above mentioned circular. The same is subject to the condition that all issue related complaints have been resolved by the merchant banker/ issuer.

3. In addition to the requirements laid down for processing of NOC applications in the aforementioned circular, the merchant banker shall submit a certificate confirming that all the SCSBs involved in ASBA process have unblocked ASBA accounts. SEBI shall consider application as incomplete if the application is not accompanied by a confirmation by merchant banker that all the accounts in ASBA have been ‘unblocked’.

4. Stock Exchanges are accordingly advised to bring the provisions of this Circular to the notice of all Listed Companies respectively and also to disseminate the same on their websites.

5. This Circular is issued in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992 to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.

6. This Circular is available on SEBI website at sebi.gov.in under the category “Legal /Circulars”.

Yours faithfully,

Medha Sonparote
General Manager
Investor Grievance Redressal Division
Office of Investor Assistance and Education
Tel No. 022 26449312

FAQ :

The time period to apply for a No Objection Certificate (NOC) for the release of 1% of the issue amount has been reduced from 4 months to 2 months after the company's listing.

All issue-related complaints must have been resolved by the merchant banker and the issuer.

Merchant bankers must now submit a certificate confirming that all Securities and Selling Commercial Banks (SCSBs) involved in the ASBA process have unblocked the ASBA accounts.

SEBI will consider the application for the NOC incomplete if it is not accompanied by the merchant banker's confirmation that all ASBA accounts have been unblocked.

Stock Exchanges are advised to bring the provisions of this Circular to the notice of all listed companies and disseminate the same on their websites.