Consultation Paper on Review and Rationalization of (Buy-Back of Securities) Regulations, 2018

Securities and Exchange Board of India, vide Consultation Paper dated May 08, 2026, has announced an important update regarding review and rationalization of SEBI (Buy-Back of Securities) Regulations, 2018.

Key Details of the Update –
• Applicability: Listed companies undertaking buy-back of shares or other specified securities, shareholders, stock exchanges, depositories, merchant bankers, secretarial auditors, and other stakeholders.

• Effective Date: Not Mentioned.

• Key Changes: SEBI has sought public comments on proposals to further review and rationalize the SEBI (Buy-Back of Securities) Regulations, 2018.

• SEBI proposes to mandate companies to send intimation of buy-back offers through electronic mode to shareholders as on the date of public announcement within one working day of such public announcement.

• SEBI proposes that open market buy-backs through stock exchange mechanism shall be completed within 66 working days from the date of opening of the offer.

• SEBI proposes to retain the requirement that at least 40% of the buy-back size shall be utilized during the first half of the offer period.

• SEBI proposes to dispense with the requirement of a separate trading window for open market buy-back through stock exchange.

• SEBI proposes to dispense with display of the company’s identity on the electronic screen as purchaser during open market buy-back through stock exchange.

• SEBI proposes that shares or other specified securities of the company held by promoters and their associates shall remain frozen at ISIN level during the buy-back period.

• The ISIN-level freeze shall not apply for the limited purpose of tendering shares where promoters participate in buy-back through the tender offer method.

• SEBI proposes to insert an explicit provision that a company or issuer shall not announce any buy-back, whether through open market or tender method, which may result in breach of minimum public shareholding requirements.

• SEBI proposes to align the interval between two buy-back offers under the Buy-Back Regulations with the interval specified under the Companies Act, 2013 for unlisted companies.

• SEBI proposes to dispense with the mandatory requirement of appointing a Merchant Banker for undertaking buy-back of shares or other specified securities.

• SEBI proposes to reassign current Merchant Banker responsibilities to the company, stock exchanges, designated stock exchange, secretarial auditor, and compliance officer, as applicable.

• Filing of letter of offer and public announcement, submission of final report, ensuring availability of funds, and Companies Act compliance are proposed to be carried out by the company.

• Buy-back compliance certification and due diligence certification are proposed to be carried out by the secretarial auditor.

• Escrow account oversight and operation are proposed to be carried out by the designated stock exchange.

• Certification relating to adequacy of sell orders and VWAP is proposed to be carried out by stock exchanges.

• Presence during extinguishment or destruction of securities in open market buy-back and verification of extinguishment compliance are proposed to be carried out by the compliance officer.

• Requirement for Merchant Banker presence during extinguishment or destruction of securities in tender offer buy-back is proposed to be done away with.

• Requirement for public announcement disclosure on Merchant Banker website is proposed to be dispensed with.

• Penalty/Consequence: Not Mentioned.

Actions if Any –
• Public and stakeholders may submit comments or suggestions on the proposals by May 29, 2026 through SEBI’s public comments link.

• In case of technical issues in submitting comments through the web-based form, comments may be sent by email to consultationcfd@sebi.gov.in with the subject “Review and rationalization of (Buy-Back of Securities) Regulations, 2018”.

Compliance Deadline –
May 29, 2026 – Last date for submission of public comments or suggestions on the proposals contained in the consultation paper.