New IPO's Gap for listing time to be reduced says SEBI

Capital market regulator SEBI said on Wednesday it has slashed the fees payable by various market players by up to 80%. The regulator will also reduce the gap between opening of an issue and the listing of securities on the bourse and make the registration norms for foreign institutional investors (FIIs) more flexible.

The fee payable by mutual funds, custodians and those who file offer documents has been cut by as much as 80% from April 1, 2008, SEBI chairman CB Bhave told reporters here after a meeting of the regulator’s board. It has also slashed the fee for offer documents for buyback of securities and the registration fee for venture capital funds.

The fee for filing offer documents for a public issue and mutual funds has been lowered from 0.03% of the amount raised to 0.005%. While the cap on fee for a public offer is Rs 3 crore, for mutual fund, it is Rs 50 lakh. The annual registration fee for custodians has been slashed from 0.001% to 0.0005% of assets under custody.

SEBI has reduced the registration fee for venture capital funds from Rs 10 lakh to Rs 5 lakh. The fee for rights issue offer documents has been slashed from 0.05% to 0.005%, subject to a maximum of Rs 5 lakh, Mr Bhave said. The fee for filing an offer document for buyback of securities has been reduced from 0.05% to 0.125%, subject to a maximum of Rs 3 crore.

Mr Bhave said SEBI has set up a panel to examine how to compress the IPO process. “Institutional investors tend to argue that they put in a lot of money that cannot be locked in for such a long time. Secondly, some people have raised the issue of funds that remain with the banks. That issue will also be automatically addressed once we reduce the gap. Although no time frame has been given, the panel will work expeditiously,” said Mr Bhave.

Foreign institutional investors (FII) can look forward to a more liberal registration regime in India. SEBI is making the FII registration norms announced last October more flexible. "We have not notified it so far because we want to make the process more flexible so that more and more FIIs can easily get registered, " SEBI whole time member T C Nair said. SEBI board had on October 25 agreed to certain changes in the registration criterion for foreign investors.

A large number of investors who were investing into India through participatory notes and wanted to register directly have been keenly waiting for the norms to be notified. Mr Nair said about 200 foreign institutional investors have registered to buy shares in India since the regulator tightened rules on investments using offshore derivatives in October.

SEBI's board also decided on Wednesday that a three-member panel headed by National Judicial Academy director Dr Mohan Gopal would oversee regulatory proceedings against the National Securities Depositories Limited. Mr Bhave had requested that he be recused from the proceedings as he was in charge of NSDL earlier. SEBI also approved in principle that Madras Stock Exchange members could be allowed to trade on NSE's platform.