Government issues stricter delisting normsJune 15th, 2009 - 9:24 pm ICT by IANS
New Delhi, June 15 (IANS) Companies that have incurred losses for three consecutive years and have negative net worth can be delisted, the government and the securities market regulator announced Monday.
Companies can also be delisted if the trading of their scrip has been suspended for more than six months, the finance ministry said in a statement.
“Rules dealing primarily with the substantive aspects and regulations dealing primarily with the procedural aspects for delisting are also being notified simultaneously by the government and the Securities and Exchange Board of India (SEBI) respectively,” the statement added.
Other grounds for delisting are:
* If the securities of a company have remained infrequently traded during the preceding three years,
* If any director or promoter of a company has been convicted for violating SEBI rules and regulations,
* If a company gives a false address or illegally changes the address of its registered office, and
* If the shareholding of a company held by the public comes below the minimum level as per the listing agreement,
The SEBI (Delisting of Equity Shares) Regulations also allows companies to voluntary delist from stock exchanges provided if they have been listed for a minimum period of three years.
The delisting rules will come into force from the date SEBI notifies them, the statement said.
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