Market regulator Securities and Exchange Board of India has asked the stock exchanges to immediately bar listed companies from issuing shares with superior rights in terms of voting or dividend compared with the rights on shares that are already listed.
"It has been decided to amend the Equity Listing Agreement to prohibit listed companies from issuing shares with superior rights as to voting or dividend vis-a-vis the rights on equity shares that are already listed," Sebi said in a statement.
Sebi said the amendment will come into force with immediate effect.
The amendment inserts the clause: 'The company agrees that it shall not issue shares in any manner which may confer on any person, superior rights as to voting or dividend vis-a-vis the rights on equity shares that are already listed'.
It has further asked the stock exchanges to inform the regulator about the status of implementation in the next monthly development report.
