The circular also requires listed companies, stock exchanges, depositories, merchant bankers and registrars and share transfer agents to ensure compliance with the new framework
The Securities and Exchange Board of India (SEBI) on Tuesday issued the operational framework for freezing promoter and promoter group shareholdings at the ISIN level during buybacks, paving the way for implementation of the amended buyback regulations from August 1.The circular follows SEBI's July 1 amendment to its buyback regulations, which requires promoter and promoter group holdings, including those of their associates, to remain frozen from the date the board or shareholders approve a buyback until the offer closes.Buyback rulesThe restriction is aimed at preventing transfers of promoter shares during the buyback period, while continuing to allow promoters to tender shares in buybacks conducted through the tender offer route and permitting invocation of encumbrances created before the buyback commenced.Under the circular, depositories have been directed to develop the operational framework and make the necessary system enhancements before August 1.The framework will specify the format for listed companies to issue freezing instructions, the modalities for implementing the ISIN-level freeze, procedures for tendering shares in buybacks, and the treatment of pledged or otherwise encumbered shares. Even where such encumbrances are invoked or released during the buyback period, the freeze will continue to apply to those shares.The circular also requires listed companies, stock exchanges, depositories, merchant bankers and registrars and share transfer agents (RTAs) to ensure compliance with the new framework.Earlier this year, the regulator reintroduced the stock exchange route for buybacks, effective August 1, after having phased it out in 2023 in favour of the tender offer mechanism. The latest circular operationalises one of the safeguards introduced alongside those changes by ensuring promoter holdings remain locked during the buyback process, reducing the scope for changes in promoter ownership while the offer is underwayPublished on July 21, 2026
