NEW DELHI: Tightening norms for companies seeking to migrate from its SME platform to the main board, BSE has said firms, directors and promoters who have been barred by markets regulator Sebi will not be eligible for the move.

Accordingly, companies that are seeking migration from the small and medium enterprises (SME) platform to the main board, would be required to submit an undertaking that the company, its promoters and directors have not been debarred by Sebi.

“Where there is any Sebi debarment order against the company, its promoters, directors, such company will not be eligible to migrate from SME to main board of BSE till such Sebi debarment order is in force,” the exchange said in a circular. Putting in place additional eligibility criteria for migration from SME to main platform of the BSE, the exchange said that if a company has been debarred from accessing the securities market, it cannot raise any funds. However, bonus issues (not amounting to raising of funds from public) would be permitted to such extent as to not increase the post-issue capital to beyond Rs 25 crore. However, where the directors and promoters of the company are debarred from accessing the securities market, then the company would be allowed to increase its capital to such extent so as to not increase the post-issue capital to more than Rs 25 crore. Further, BSE said that debarred entities would not be eligible to participate in any such further issue of capital. “While the Sebi debarment is in force against the company, its promoters and directors, it shall be mandatory for the company to appoint a trading member of BSE as a market maker even after the completion of mandatory period of three years. In case of any default during market making penalties /actions will be imposed as per the existing guidelines,” it added. BSE launched its SME platform for small and medium enterprises in March 2012. Since then, it has been receiving very positive response and 161 companies have already got listed in this segment. The companies have to be mandatorily listed and traded on the SME platform for a minimum period of two years and only after that can they migrate to the main board, as per the guidelines specified by Sebi. Firms that have completed two years on the SME platform and achieved a post-issue paid-up capital of at least Rs 10 crore are eligible for migration. In case the paid-up capital exceeds Rs 25 crore threshold, it is required to migrate to the main board. — PTI