SEBI Doubles Monetary Threshold for Duplicate Securities to ₹10 Lakh
SEBI has implemented comprehensive reforms for duplicate securities issuance, doubling the simplified documentation threshold to ₹10 lakh and introducing a tiered approach based on securities value. The changes include elimination of notarisation requirements for smaller holdings, standardised formats, and mandatory demat mode for all duplicate securities, effective immediately.
*this image is generated using AI for illustrative purposes only.
The Securities and Exchange Board of India (SEBI) has implemented comprehensive reforms to streamline the process of obtaining duplicate securities, significantly reducing compliance burden for investors. The regulator announced on Wednesday that it has doubled the monetary threshold for simplified documentation from ₹5 lakh to ₹10 lakh, making the process faster, more efficient and investor-friendly.
The SEBI move follows a consultation paper the market watchdog issued in November to ease investor compliance and remove inconsistencies. The regulator said the ₹5 lakh threshold was too small, no longer reflected current market realities, and imposed an avoidable procedural burden on investors.
Key Changes in Documentation Requirements
SEBI has introduced a tiered approach to documentation based on the value of securities held. The new framework establishes clear categories with specific requirements for each tier.
| Securities Value: | Documentation Required |
|---|---|
| Up to ₹10,000 | Simple undertaking on plain paper |
| ₹10,001 to ₹10 lakh | Standard Affidavit-cum-Indemnity Bond on non-judicial stamp paper |
| Above ₹10 lakh | Additional FIR copy, police complaint, court order, or plaint with full securities details |
A significant relief for smaller investors is the elimination of notarisation requirements for the Affidavit-cum-Indemnity Bond when securities are valued up to ₹10,000. This change removes an additional procedural step that previously added time and cost to the process.
Five Key Points for Investors
The overhaul ensures that investors holding securities valued up to ₹10 lakh will now be required to submit fewer documents. Here are the essential points investors must know:
| Key Changes: | Details |
|---|---|
| Standardised Format | SEBI has prescribed a standardised Affidavit-cum-Indemnity Bond format and rationalised documentation for securities valued above ₹10 lakh |
| No Notarisation | Notarisation of the Affidavit-cum-Indemnity Bond will no longer be required for securities valued up to ₹10,000 |
| Demat Mode | All duplicate securities issued would necessarily be in demat mode, resulting in increased dematerialisation |
| Strict Processing | SEBI circular directs all listed companies and RTAs to process requests strictly in line with the revised procedure |
| No Resubmission | Investors who have already submitted documents under the old framework will not be required to resubmit them in the new formats |
Previous Requirements and Changes
SEBI had prescribed the documentary and procedural requirements for issuing duplicate share certificates through its master circular. Under the previous rules, if the securities' value was ₹5 lakh or more, the security holder was required to submit a copy of FIR or police complaint or court injunction order along with details of the securities, folio number, distinctive number range and certificate numbers.
Investors were also required to advertise the loss of securities in a widely circulated newspaper and submit an affidavit and indemnity bond separately on non-judicial stamp paper. The SEBI paper noted that the value of securities could be less than the value of stamp duty in many cases, making the payment of stamp duty on two different instruments illogical.
Implementation and Immediate Effect
The changes were made via a circular issued late Wednesday and the provisions came into force immediately. The new rules apply to all applications currently under process, with SEBI directing all listed companies and registrar and transfer agents (RTAs) to process requests strictly according to the revised procedures.
This move by SEBI is expected to reduce the compliance burden for investors significantly by making it easier for a larger number of investors to obtain duplicate securities with less paperwork and fewer procedural hurdles, while promoting dematerialisation across the securities market.
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