Bombay Stock Exchange Circular on SEBI Order as regards to appointment of directors in listed companies.
SEBI has issued instructions to all the Exchanges on June 14, 2018, wherein SEBI has referred to enforcement of its Orders debarring entities/individuals from accessing the capital markets and / or restraining from holding position of directors in any listed company.
Vide this communication, SEBI has issued certain directions regarding enforcement and monitoring of the appointment of restrained persons mentioned in the SEBI orders. Accordingly, the directions issued for the Listed Companies are as follows:
PERSON TO BE APPOINTED AS DIRECTOR SHALL NOT BE DEBARRED TO ACT AS DIRECTIOR BY SEBI ORDER
a. Listed companies and its Nomination Committee while considering a person for appointment as director, shall verify that the said person is not debarred from holding the office of director pursuant to any SEBI order.
BSE LISTED COMPANIES SHOULD AFFIRM THAT THE PROPOSED DIRECTOR IS NOT DEBARRED
b. The Listed Companies shall, while informing the Exchange through corporate announcements for appointment of Director, specifically affirm that the Director being appointed is not debarred from holding the office of director by virtue of any SEBI order or any other such authority. Non-inclusion of such fact will be regarded as inadequate submission and the same would be subject to action as deemed fit under Regulation 30 of the LODR.
BSE LISTED COMPANIES SHOULD REMOVE SUCH DEBARRED DIRECTOR BY SEBI FROM DIRECTORSHIP
c. In case an existing director is restrained from acting as a director by virtue of any SEBI order or any other such authority, the director shall voluntarily resign with immediate effect, failing which the listed entity shall initiate the process of removal of such director in terms of relevant sections of the Companies Act, 2013, and inform the Exchange about the same.
Source- BSE Circular