All You Need To Know About Minimum Public Shareholding Norms
Public means persons other than – (i) the promoter and promoter group; (ii) subsidiaries and associates of the company. Public shareholders could be individual or financial institutions and they normally buy shares through public offer or secondary markets. In order to bring more transparency in the working of listed companies, the concept of minimum public shareholding(MPS) has been introduced. The timeline for achieving MPS varies for listed public sector companies and listed companies. With regard to the listed public sector companies, the deadline to meet the MPS was 2 years from the commencement of the Securities Contracts (Regulation) (Second Amendment) Rules, 2018 which expired on 2nd August, 2020. Considering the unfavorable market conditions and difficulty in meeting the MPS requirement during the outbreak of the Corona Virus, the Ministry of Finance has vide its notification dated July 31, 2020 has extended the time period by 1 year i.e. till August 2, 2021 for listed public