(1) 34[Registration granted under regulation 8] shall be subject to the following conditions, namely:—
(a) where the underwriter proposes 35[change in control], it shall obtain prior approval of the Board for continuing to act as such after the change;
(b) it shall enter into a valid agreement with the body corporate on whose behalf it is acting as underwriter;
(c) 36[it shall pay the fees for registration, in the manner provided in these regulations;]
(d) it shall maintain capital adequacy requirements specified in regulation 7 at all times during the period of the 37[***];
(e) it shall abide by the regulations made under the Act in respect of the activities carried on by it as underwriter;
38[(f) (f) it shall immediately intimate the Board, details of changes that have taken place in the information that was submitted, while seeking registration.]
(2) Nothing contained in clause (a) of sub-regulation (1) shall affect the obligation to obtain a fresh registration under section 12 of the Act in cases where it is applicable.
9B 39[***] 34 Substituted for the words “Any 34[initial registration] granted under regulation 8 or any 34[permanent registration granted under regulation 8A” by the Securities and Exchange Board of India (Change In Conditions Of Registration Of Certain Intermediaries) (Amendment) Regulations, 2016 w.e.f. 08-12-2016.
Prior to this the words “initial registration” were substituted for the word “registration” by the SEBI (Underwriters) (Amendment) Regulations, 2011, w.e.f. 5-7-2011.
35 Substituted for the words “to change its status or constitution” by the SEBI(Change in Conditions of Registration of Certain Intermediaries) (Amendment) Regulations, 2011, w.e.f. 19-4-2011.
36 Substituted by the Securities and Exchange Board of India (Change In Conditions Of Registration Of Certain Intermediaries) (Amendment) Regulations, 2016 w.e.f. 08-12-2016. Prior to this clause (c) read as under:
“(c) it shall pay the fees for 36[initial registration or permanent registration], as the case may be, in the manner provided in these regulations;” Prior to this, the words “initial registration or permanent registration” were substituted for the words ““registration or renewal” by the SEBI (Underwriters) (Amendment) Regulations, 2011, w.e.f. 5-7-2011.” 37 The words “initial or permanent” were omitted by the Securities and Exchange Board of India (Change In Conditions Of Registration Of Certain Intermediaries) (Amendment) Regulations, 2016 w.e.f. 08-12-
2016. Prior to this the words “initial or permanent” were substituted for the words “certificate or renewal thereof” by the SEBI (Underwriters) (Amendment) Regulations, 2011, w.e.f. 5-7-2011.
38 Inserted by the Securities and Exchange Board of India (Change In Conditions Of Registration Of Certain Intermediaries) (Amendment) Regulations, 2016 w.e.f. 08-12-2016.
39 Omitted by the SEBI (Underwriters) (Amendment) Regulations, 2011, w.e.f. 5-7-2011. Prior to omission, Regulation 9B inserted by the SEBI (Underwriters) (Amendment) Regulations, 2006, w.e.f. 7-9-2006, read as under:
“Period of validity of certificate.
9B. The certificate of registration granted under regulation 8 and its renewal granted under regulation 9, shall be valid for a period of three years from the date of its issue to the applicant.” Page 11 of 26 Procedure where registration is not granted.
10. 40[ (1) Where an application for grant of a certificate of registration under regulation 3A does not fulfil the requirements set out in regulation 6, the Board shall reject the application after giving an opportunity of being heard.]
41[(2) The decision shall be communicated by the Board within thirty days of such decision stating therein the grounds on which the application has been rejected.]
(3) Any applicant may, being aggrieved by the decision of the Board under subregulation (2), apply within a period of thirty days from the date of receipt of such intimation, to the Board for reconsideration of its decision.
(4) On receipt of the application made under sub-regulation (3), the Board shall reconsider its decision and communicate its findings thereon as soon as possible in writing to the applicant.
11. 42[***] Payment of fees, and the consequences of failure to pay fees.
40 Substituted by the Securities and Exchange Board of India (Change In Conditions Of Registration Of Certain Intermediaries) (Amendment) Regulations, 2016 w.e.f. 08-12-2016. Prior to substitution subregulation (1) read as under:
“(1) Where an application for grant of a certificate 40[of initial registration under regulation 3A or of permanent registration under regulation 8A] does not fulfil the requirements set out in regulation 6, the Board may reject the application, after giving an opportunity of being heard.” Prior to this the words “of initial registration under regulation 3A or of permanent registration under regulation 8A” were substituted for the words and figures “under regulation 3 or of renewal under regulation 9” by the SEBI (Underwriters) (Amendment) Regulations, 2011, w.e.f. 5-7-2011.
41 Substituted by the SEBI (Underwriters) (Amendment) Regulations, 1997, w.e.f. 17-1-1997. Prior to substitution, it read as under:
“The refusal to grant or renew the certificate shall be communicated by the Board within 30 days of such refusal to the applicant stating therein the grounds on which the application has been rejected.” 42 Omitted by the Securities and Exchange Board of India (Change In Conditions Of Registration Of Certain Intermediaries) (Amendment) Regulations, 2016 w.e.f. 08-12-2016. Prior to omission, regulation 11 as substituted by the SEBI (Underwriters) (Amendment) Regulations, 2011, w.e.f. 5-7-2011 read as under:
“Effect of refusal to grant certificate of permanent registration.
11. The underwriter whose application for grant of certificate of permanent registration has been refused by the Board, on and from the date of receipt of the communication, shall not carry on any activity as an underwriter:
Provided that the Board may, in the interest of the investors of the securities market, permit to carry on activities undertaken prior to the receipt of the intimation of refusal subject to such condition as the Board may specify.” Earlier regulation 11 as amended by the SEBI (Underwriters) (Amendment) Regulations, 1997, w.e.f. 17- 01-1997, read as under:
Effect of refusal to grant or renew certificate.
11. Any underwriter whose application for grant or renewal of a certificate has been refused by the Board shall on and from the date of the receipt of the communication under sub-regulation (2) of regulation 10 cease to act as an underwriter:
Provided that if the Board is satisfied that it is in the interest of the investors, it may permit the underwriter to undertake the underwriting commitments already entered into by him during the validity period of the certificate.
Page 12 of 26
12. 43[“(1) Every applicant eligible for grant of registration, shall pay the fees in such manner and within the period specified in Schedule II:]
44[***]
Provided 45[***] that a stock broker 46[***], who has been granted a certificate under section 12 of the Act and pays fees under the Securities and Exchange Board of India (Stock Brokers and Sub-brokers) Regulations, 1992 47[***], shall not be required to pay fees under sub-regulation (1).
(2) Where an underwriter fails to pay the fees as provided in sub-regulation (1), the Board may suspend the certificate, whereupon the underwriter shall forthwith cease to act as an underwriter.
CHAPTER III GENERAL OBLIGATIONS AND RESPONSIBILITIES To abide by the Code of Conduct.
13. Every underwriter shall at all times abide by the Code of Conduct as specified in Schedule III.
Agreement with clients.
14. Every underwriter shall enter into an agreement referred to in 48[clause (b) of sub-regulation (1) of regulation 9A] with each body corporate on whose behalf he is acting as underwriter and the said agreement shall, amongst other things, provide for the following, namely :—
(i) the period for which the agreement shall be in force;
43 Substituted by the Securities and Exchange Board of India (Change In Conditions Of Registration Of Certain Intermediaries) (Amendment) Regulations, 2016 w.e.f. 08-12-2016. Prior to substitution, subregulation (1) read as under:
“(1) Every applicant eligible for grant 43[of initial or permanent registration, as the case may be,] shall pay fees in such manner and within the period specified in Schedule II:” Prior to this the words “of initial or permanent registration, as the case may be,” were substituted for the words “or renewal of a certificate”, by the SEBI (Underwriters) (Amendment) Regulations, 2011, w.e.f. 5- 7-2011 44 Omitted by the SEBI (Underwriters) (Amendment) Regulations, 1997, w.e.f. 17-01-1997. Prior to omission, it read as under:
“ Provided that the Board may on sufficient cause being shown permit the underwriter to pay such fees at any time before the expiry of six months from the date on which such fees become due.” 45 Word ‘further’ omitted, ibid.
46 Words “or a merchant banker” omitted by the SEBI (Underwriters) (Amendment) Regulations, 2002, w.e.f. 10-12-2002.
47 Words “or the Securities and Exchange Board of India (Merchant Bankers) Regulations, 1992” omitted, ibid.
48 Substituted for the words, brackets and figures “clause (b) of rule 4” by the SEBI (Underwriters) (Amendment) Regulations, 2006, w.e.f. 7-09-2006.
Page 13 of 26 49[(ia) the allocation of duties and responsibilities between the underwriter and the client;]
(ii) the amount of underwriting obligations;
(iii) the period, within which the underwriter has to subscribe to the issue after being intimated by or on behalf of such body corporate;
(iv) the amount of commission or brokerage payable to the underwriter;
(v) details of arrangements, if any, made by the underwriter for fulfilling the underwriting obligations.
General responsibilities of an underwriter.