New Delhi, Nov 17 (PTI) Capital markets regulator Sebi on Friday decided to do away with the provision of requiring the freezing of folios without PAN, KYC details and nomination for all holders of physical securities.

The move, aimed at simplifying the rule, will come into force with immediate effect, the Securities and Exchange Board of India (Sebi) said in a circular.

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The decision has been taken after receiving feedback from the Registrars' Association of India and investors.

Under the rule, it was mandatory for all holders of physical securities in listed companies to furnish PAN, nomination, contact details, bank account details and specimen signature for their corresponding folio numbers.

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The folios wherein any one of such documents are not available on or after October 1, 2023, is required to be frozen by the Registrars to an Issue and Share Transfer Agents (RTA), Sebi said in May.

Amending the circular issued in May, Sebi said that reference to the term 'freezing/ frozen' has been deleted.

"Based on representations received from the Registrars' Association of India, feedback from investors, and to mitigate unintended challenges on account of freezing of folios and referring frozen folios to the administering authority under the Benami Transactions (Prohibitions) Act, 1988 and/or Prevention of Money Laundering Act, 2002, it has been decided to do away with the above provisions," Sebi said.

Further, frozen folios were required to be referred by the RTA or listed company to the administering authority under the Benami Transactions (Prohibitions) Act, 1988, and/or Prevention of Money Laundering Act, 2002, if they continue to remain frozen as on December 31, 2025.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)