REGULATORY HURDLES IN LISTING OF SHARES OF NON-PROFIT COMPANIES
DOI:
https://doi.org/10.48047/0bcx2h69Keywords:
non-profit social enterprises (NPCs), Securities and Exchange Board of India (SEBI), listing. CA, SCRA, SCRR.Abstract
Companies Act, 2013 provides for incorporation of non-profit companies (NPCs) under section 8
of the said Act.
The Working Committee appointed by Securities and Exchange Board of India (SEBI) for making
recommendations on social stock exchanges has in its report submitted to SEBI observed that there
are no regulatory hurdles for the NPCs in listing their equity shares on recognised stock exchanges.
This paper names and discusses the legal and regulatory hurdles in the non-profit companies in
listing their shares on a recognised stock exchange in the context of the existing provisions under
Companies Act, 2013 (CA), Securities Contracts (Regulation) Act, 1956 (SCRA), Securities
Contracts (Regulation) Rules, 1957 (SCRR), and relevant SEBI Regulations. The papers also
attempt to identify the market constraints that may come in the way of creation of liquidity in the
shares of such companies.
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