Securities Laws

SEBI Impose Penalty on Listed Companies for Non–Appointment of Woman Director

The Securities and Exchange Board of India ("SEBI") has earlier imposed additional compliance requirement in respect of Clause 49 of the Listing Agreement which mandated that the board of directors of listed entities to have an optimum combination of executive and non-executive directors with at least one woman director on the board. However, vide circular dated September 15, 2014, the time to comply the compliance requirement was extended to March 31, 2015. Now, SEBI has advised stock exchange to penalize the companies (who has not complied with this requirement) by imposing penalty to the extent of INR 50,000 to INR 142,000 plus INR 5,000 per day from October 2015 till the date when they comply with the provision. In case of non-compliance beyond September 30, 2015, SEBI may take action against non-compliant companies, their promoters, directors or issue direction in accordance with law.