The Securities and Exchange Board of India hereby enacts the following regulations to further amend the Securities and Exchange Board of India (Real Estate Investment Trusts) Regulations, 2014 in accordance with the authority granted under sections 30 read together with sections 11 and 12 of the Securities and Exchange Board of India Act, 1992 (15 of 1992). These regulations may be called the Securities and Exchange Board of India (Real Estate Investment Trusts) (Amendment) Regulations, 2023.
Clause (g) of regulation 2’s sub-regulation (1) of the Securities and Exchange Board of India (Real Estate Investment Trusts) Regulations, 2014 must be replaced with the phrase “change in control.”
The amendment inserted (qai) inserted after (qa) is the amendment added “Independent director” in case of a company means a director, other than a nominee director of the Manager.
Also, the amendment added Chapter VIA; Obligations of manager. A vigil mechanism was added through the amendment. That is the Manager shall formulate a vigil mechanism, including a whistle blower policy for directors and employees to report genuine concerns.
The major additions in the Chapter VIA are:
Vigil Mechanism
The Manager must develop a monitoring system including a whistleblower policy for directors and workers to raise legitimate concerns. The vigil system must offer sufficient protections against victimisation of any directors, employees, or other users of the mechanism, as well as direct access to the audit committee chairperson in necessary or extraordinary circumstances.
The Manager may hire an independent service provider to run the vigil mechanism and make reports to the audit committee. The effectiveness of the vigil system will be examined by the audit committee.
Secretarial Compliance Report
The Manager shall submit a secretarial compliance report given by a practicing company secretary to the stock exchanges, in such form as specified, within sixty days from end of each financial year. (2) The secretarial compliance report referred to in sub-regulation (1) of this regulation shall be annexed with the annual report of the REIT.
Quarterly Compliance Report on Corporate governance
The Manager shall submit a quarterly compliance report on governance in the format as may be specified by the Board, to the recognized stock exchange(s) within twenty-one days from the end of each quarter.
Further, schedule VIII was inserted. Under this schedule ‘Governance Norms’ was added. Under that Part A and Part B. Part A consists of minimum information to be placed before the board of directors of the manager and part B consists of a Compliance certificate. The amendment provided a number of lists of information that should be submitted before the directors.
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