Sebi introduces new framework for related party transactions
pre-market1 source ↓written by the desknot a recommendation
- if it exceeds
- 10% of annual turnover
Markets regulator Sebi has launched a threshold-based framework for determining the materiality of related party transactions (RPTs). For entities with turnover up to ₹20,000 cr, a transaction is material if it exceeds 10% of annual turnover. This aims to enhance clarity and balance investor protection with business ease under LODR norms.
The revised thresholds also simplify audit committee approvals for subsidiaries, addressing practical challenges in compliance. Immediate implications could influence how companies approach RPTs and enhance transparency in disclosures.
Not investment advice. For informational purposes only.