Abolition of No Deilivery Period for all corporate Actions

Last updated: 22 July 2009

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Deputy General Manager

Market Regulation Department-Division of Policy

E-mail: harinib@sebi.gov.in

MRD/DoP/SE/Cir-07/2009

July 21, 2009

The President/Executive Director/

Managing Director of all the Stock Exchanges

Dear Sir/Madam,

Sub: Abolition of no-delivery period for all types of corporate actions.

1. SEBI vide circular no. SEBI/CFD/DIL/LA/1/2009/24/04 dated April 24, 2009 has

reduced the notice period from companies to stock exchanges to atleast 7 working

days for all types of corporate actions.

2. Pursuant to the recommendations made by the Secondary Market Advisory

Committee of SEBI at its meeting held on June 30, 2009, it is decided to do away

with ‘no-delivery period’ for all types of corporate actions in respect of the scrips

which are traded in the compulsory dematerialised mode and accordingly, short

deliveries, if any, of the shares traded on cum-basis may be directly closed out. In

case of such direct close-out, the mark-up price would be as stated in SEBI circular

no. SMD/POLICY/Cir-08/2002 dated April 16, 2002.

3. The Stock Exchanges are also advised to:

a. make necessary amendments to the relevant bye-laws, rules and regulations for

the implementation of the above decision.

b. bring the provisions of this circular to the notice of the member brokers/clearing

members of the Exchange and also to disseminate the same on the website.

c. communicate to SEBI, the status of the implementation of the provisions of this

circular in the Monthly Development Report.

4.

This circular is being issued in exercise of powers conferred under Section 11 (1) of

Harini Balaji

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.

5. The circular will come into effect from August 1, 2009, and accordingly will apply to

all corporate actions for which the record date / book closure falls on or after August

10, 2009.

Yours faithfully,