CIRCULAR
SEBI/HO/CFD/CFD-PoD-2/P/CIR/2025/18 February 14, 2025
To,
All listed entities
All the recognized Stock Exchanges
The Associated Chambers of Commerce and Industry of India (ASSOCHAM)
Federation of Indian Chambers of Commerce and Industry (FICCI)
Confederation of Indian Industry (CII)
Dear Sir/Madam,
Sub: Industry Standards on “Minimum information to be provided for review of
the audit committee and shareholders for approval of a related party
transaction”
1. Regulation 23(2), (3) and (4) of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (“LODR Regulations”) require related party
transactions (“RPTs”) to be approved by the audit committee and by the
shareholders, if material. Part A and Part B of Section III-B of SEBI Master
Circular dated November 11, 20241 (“Master Circular”) specify the information
to be placed before the audit committee and shareholders, respectively, for
consideration of RPTs.
2. In order to facilitate uniform approach and assist listed entities in complying with
the above mentioned requirements, the Industry Standards Forum (“ISF”)
comprising of representatives from three industry associations, viz. ASSOCHAM,
CII and FICCI, under the aegis of the Stock Exchanges, has formulated industry
standards, in consultation with SEBI, for minimum information to be provided for
review of the audit committee and shareholders for approval of RPTs. The
industry associations which are part of ISF (ASSOCHAM, FICCI, and CII) and
the stock exchanges shall publish the industry standards on their websites.
3. The listed entities shall follow the aforesaid industry standards to ensure
compliance with Part A and Part B of Section III-B of the Master Circular read
with Regulation 23(2), (3) and (4) of LODR Regulations.
1 Master Circular for compliance with the provisions of the Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations, 2015 by listed entities
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4. Section III-B of the Master Circular shall stand modified as given below:
4.1. Paragraph 4 under Part A of Section III-B shall stand substituted by the
following paragraph:
“The listed entity shall provide the audit committee with the information as
specified in the Industry Standards on “Minimum information to be provided for
review of the audit committee and shareholders for approval of a related party
transaction”, while placing any proposal for review and approval of an RPT.”
4.2. Paragraph 6 under Part B of Section III-B shall stand substituted by the
following paragraph:
“The notice being sent to the shareholders seeking approval for any RPT shall,
in addition to the requirements under the Companies Act, 2013, include the
information as part of the explanatory statement as specified in the Industry
Standards on “Minimum information to be provided for review of the audit
committee and shareholders for approval of a related party transaction”.”
5. This circular shall come into effect from April 1, 2025.
6. The Stock Exchanges are advised to bring the contents of this circular to the
notice of their listed entities and ensure its compliance.
7. This circular is issued in exercise of the powers conferred under Section 11(1)
and 11A of the Securities and Exchange Board of India Act, 1992 read with
regulation 101 of LODR Regulations.
8. This circular is available on SEBI website at www.sebi.gov.in under the category:
‘Legal → Circulars’.
Yours faithfully,
Raj Kumar Das
Deputy General Manager
Corporation Finance Department
Tel. No.: +91 22 2644 9253
Email id: rajkd@sebi.gov.in
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