Reg 31A reclassification of a promoter
The sequence of board, exchange and shareholder steps that moves a person from the promoter group to public, each with its own period.
2 months for the board to give its views
Counted from receipt of the promoter's request for reclassification
- SEBI
- SEBI events and governance
- Not specified
- 2026-09-01
Reg 31A runs on five periods, not one. The board gives its views at the next board meeting or within two months of the promoter's request. The entity applies to the exchange for a no-objection within five days of that board consideration. The exchange decides within thirty days. The entity puts the request to shareholders within sixty days of the no-objection, and tells the exchange within five days of shareholder approval.
The whole sequence was re-ordered with effect from 13 December 2024. The board now has the next board meeting or two months rather than three months, the exchange application moved to before shareholder approval rather than after, and the one-to-three-month board-to-meeting gap disappeared. Old Reg 31A(2) was omitted. A procedure note written to the earlier sequence will put the steps in the wrong order, not merely on the wrong dates.
Deadlines counted from an event
The board analyses the request and gives its views at the immediate next board meeting, or within two months of receiving the request, whichever is earlier. Sixty days is how this engine counts two months. Before 13 December 2024 the period was three months and a further gap of one to three months separated the board meeting from the general meeting.
Within five days of the board's consideration, apply to the stock exchange for a no-objection to the proposed reclassification.
The stock exchange takes a decision on the application within thirty days of receiving it. This period binds the exchange rather than the listed entity.
Place the request before the shareholders in a general meeting within sixty days of the no-objection letter.
Within five days of shareholder approval, tell the stock exchange and give effect to the reclassification.
Reg 31A(9) switches off Reg 31A(5), 31A(6) and 31A(7)(b) where the reclassification is pursuant to a resolution plan approved under section 31 of the Insolvency and Bankruptcy Code, subject to disclosure to the stock exchanges within one day of that approval.
The rule
The board analyses the request and gives its views at the immediate next board meeting, or within two months of receiving the request, whichever is earlier. Sixty days is how this engine counts two months. Before 13 December 2024 the period was three months and a further gap of one to three months separated the board meeting from the general meeting.
Within five days of the board's consideration, apply to the stock exchange for a no-objection to the proposed reclassification.
The stock exchange takes a decision on the application within thirty days of receiving it. This period binds the exchange rather than the listed entity.
Place the request before the shareholders in a general meeting within sixty days of the no-objection letter.
Within five days of shareholder approval, tell the stock exchange and give effect to the reclassification.
Reg 31A(9) switches off Reg 31A(5), 31A(6) and 31A(7)(b) where the reclassification is pursuant to a resolution plan approved under section 31 of the Insolvency and Bankruptcy Code, subject to disclosure to the stock exchanges within one day of that approval.
Who must comply
- Every entity with specified securities listed on a recognised stock exchange
- A promoter or a member of the promoter group asking to be reclassified as public
- The outgoing promoter must hold no more than ten percent of the voting rights, must not exercise control, and must hold no special rights through a formal or informal arrangement
- Reg 31A(9): where the reclassification follows a resolution plan approved under section 31 of the Insolvency and Bankruptcy Code, Reg 31A(5), 31A(6) and 31A(7)(b) do not apply, and the entity instead discloses to the exchanges within one day of the plan's approval.
Statutory basis
Before you file
- Get a written request from the promoter seeking reclassification.
- Confirm the promoter holds not more than ten percent of the voting rights.
- Confirm the promoter exercises no control and holds no special rights.
- Prepare the board note analysing the request against the Reg 31A conditions.
- Prepare the explanatory statement for the general meeting notice.
How to file
- Place the promoter's request before the next board meeting.
- Record the board's views on the request.
- Apply to each exchange for a no-objection within five days of that board meeting.
- Wait for the exchange decision, which is due within thirty days.
- Call the general meeting and put the request to shareholders within sixty days of the no-objection.
- Tell each exchange within five days of shareholder approval.
- Give effect to the reclassification in the shareholding pattern.
- Keep the three-year post-reclassification conditions under review.
Stock exchange electronic filing system
If you miss it
No per-day exchange fine is asserted here, because this provision is not on the fine table we have verified. SEBI adjudicates a late or missed disclosure under section 15A(b) of the SEBI Act, which reaches ₹1 lakh for each day the failure continues and is capped at ₹1 crore. Section 23E of the Securities Contracts (Regulation) Act is the other head, at not less than ₹5 lakh and up to ₹25 crore for a breach of listing conditions. Orders in this area normally land in lakhs rather than near the ceiling.
- The exchange records the default in the entity's compliance history, and a repeated default feeds SEBI's decision to adjudicate
- The disclosure still has to be made after the deadline passes, and it has to carry an explanation for the delay
- Disclosing favourable events on time while letting unfavourable ones slip is charged as a breach of Reg 4(1)(d) in its own right, alongside the specific provision
- The exchange can simply refuse the no-objection, which leaves the person on the promoter list and keeps every promoter-group obligation running
Recent changes affecting this
Relaxation from SEBI Master Circular for Minimum Public Shareholding Non-Compliance
Master Circular for compliance with the provisions of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 by listed entities
Master Circular for listing obligations and disclosure requirements for Non-convertible Securities, Securitized Debt Instruments and/ or Commercial Paper
Common questions
Does the exchange application come before or after the shareholders?
Before. Old Reg 31A(2) required the entity to apply to the exchanges only after shareholder approval, and it was omitted with effect from 13 December 2024. The order is now board, exchange no-objection, then shareholders.
Is the board's period still three months?
No. It is the next board meeting or two months from the request, whichever is earlier. The old three-month period, and the separate one-to-three-month gap between the board meeting and the general meeting, both went on 13 December 2024.
What happens after reclassification?
The conditions in Reg 31A that run for three years after reclassification continue to apply to the reclassified person, and they are unchanged by the 2024 amendment.