New Outlook for Employee Welfare Trusts Shareholding in the proposed ESOP & ESPS Regulations
On November 20, 2013, the capital market regulator, SEBI came out with Discussion Paper on 'Review of guidelines governing stock related employee benefit schemes' with the intent to frame comprehensive ESOP & ESPS Regulations. Primarily, the discussion paper aims to allow secondary market acquisitions by Employee Welfare Trusts in order to align the working of the said Trusts with the internationally accepted practice thereby facilitating the companies to grant options to employees without diluting their existing share capital, something that had been prohibited earlier by the capital market regulator, SEBI vide its Circular dated 17th January, 2013. Ms. Mohini Varshney Assistant Vice President +919971673332 mohini@indiacp.com Till date, there is no specific framework that governs the classification of the Employee Welfare Trusts in the Promoter/ Non-Promoter Category. Therefore, there is no standard practice being followed by the Companies in respect of cl...