No transfer of physical shares from Dec 5

The Securities & Exchange Board of India (SEBI) has recently amended provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, to disallow listed companies from accepting a request for transfer of securities which are held in physical form with effect from December 5, 2018.

Due to this amendment, shareholders who continue to hold shares and other types of securities of listed companies in physical form after December 5, 2018, will not be able to lodge the shares with the company or its Registrar & Transfer Agent (RTA) for further transfer.

These shareholders will need to convert these shares into demat form compulsorily if they wish to transfer the shares. Hence, after December 5, only shares in demat form can be transferred by the listed companies or their RTAs.

This amendment will help in curbing fraud and mitigating the risk of manipulation in physical transfer of securities by unscrupulous persons. Further, shares held in demat form will improve the ease, convenience, and safety of transactions for the investors.

In view of the above, investors who are holding shares etc. in physical form should open a demat account at the earliest and submit a request for dematerialization of their physical shares so that liquidity of the shares is maintained.