BSE gets SEBI nod for social stock exchange as separate segment
- In July, SEBI notified rules for Social Stock Exchange (SSE) to provide social enterprises with an additional avenue to raise funds
Stock exchange BSE on Friday announced that it has got an in-principle nod from the capital market regulator Securities and Exchange Board of India (SEBI) for the social stock exchange as a separate segment.
“This is to inform that, SEBI has granted its in-principle approval to BSE for introducing SSE as a separate segment on BSE,” the company informed in an exchange filing on the NSE today.
In July, the regulator notified rules for Social Stock Exchange (SSE) to provide social enterprises with an additional avenue to raise funds. Social enterprises (SEs) eligible to participate in the SSE will be entities, non-profit organisations (NPOs) and for-profit social enterprises. Under the new rules, SSE will be a separate segment of the existing stock exchanges.
Last month, Sebi came out with a detailed framework for social stock exchange, specifying minimum requirements for a Not-for-Profit Organisation (NPO) for registering with the bourse and disclosure requirements.
In its circular, the regulator specified minimum requirements to be met by a NPO for registration with SSE, disclosure requirement for NPOs raising funds through the issuance of zero-coupon zero principal instruments and put in place annual disclosure requirements that needs to be made by NPOs on such exchanges.
With regard to minimum requirements to be met by a NPO, Sebi said that NPO needs to be registered as a charitable trust and should be registered for at least three years, must have spent at least ₹50 lakh annually in the past financial year and should have received a funding of at least ₹10 lakh in the past financial year.
According to a PTI report, SSE is a novel concept in India and such a bourse is meant to serve the private and non-profit sectors by channelling greater capital to them and the idea of SSE was first floated by Finance Minister Nirmala Sitharaman in her Budget speech for the financial year 2019-20.
Corporate foundations, political or religious organisations or activities, professional or trade associations, infrastructure and housing companies, except affordable housing, will not be eligible to be identified as a social enterprise.
(With inputs from PTI)
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