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Mumbai , Dec. 26

SEBI has proposed to streamline the employee stock option plan (ESOP) and employee stock purchase scheme (ESPS) guidelines in order to allow companies to file for in-principle listing approval anytime after the grant of options and before vesting the same. This makes the listing process faster, to ensure liquidity and secondary market activity in the ESOP shares, said SEBI.

Based on the queries SEBI received after the June 30, 2003 amendments to the guideline, filing of additional information, role of merchant banker and disclosures in the Directors report are proposed to be streamlined along with the listing approval.

In order to enable the stock exchange to exercise control over the stock option schemes, companies have to file a statement giving details like the number of securities reserved for ESOP, the total number of securities issued on cumulative basis and balance securities yet to be issued, according to the proposal.

The role of the registered merchant banker for the implementation of ESOS and ESOP is proposed to be elaborated for the sake of clarity and effectiveness, SEBI said. The merchant banker will ensure the compliance to the guidelines and certify the contents of Schedules filed with stock exchanges, clarified SEBI.

The statement also mentioned that the additional disclosure requirements mandated in the Directors report will be applicable to the existing ESOP and ESPS schemes that are under the purview of the guidelines.

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