The Securities and Exchange Board of India (“SEBI”) has notified the Securities and Exchange Board of India (Buy-Back of Securities) (Amendment) Regulations, 2026 on July 1, 2026 which shall be effective August 1, 2026 (“Amendment Regulations”). The Amendment Regulations substantially reworks the SEBI (Buy-Back of Securities) Regulations, 2018 (“Buy-Back Regulations”).

The key changes are as follows:

• Open market route revived, at a lower ceiling. From August 1, 2026, open market buy-backs must be less than 15% of paid-up capital and free reserves, tested on both a standalone and consolidated basis.

• New minimum public shareholding (“MPS”) safeguard. Unlike the erstwhile framework, no buy-back by either route may now be structured in a manner that breaches MPS norms as prescribed under the Securities Contracts (Regulation) Rules, 1957 or the SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015.

• Execution Timelines. Open market offers must open within 4 (four) working days of the public announcement and close within 66 (sixty-six) working days of opening, this is a defined window absent from the erstwhile framework.

• Freezing of ISIN: The shares held by the promoters and promoter group including their associates for which buy-back is being undertaken, will remain frozen at ISIN level during the period from the date of passing of the resolution by the board of directors or the special resolution, as the case may be, till the closing of the offer.

• Merchant banker appointment made optional. This marks a clear departure from the erstwhile mandatory-appointment regime. Companies that opt out must redistribute the merchant banker’s functions among the Company, Secretarial Auditor, Statutory Auditor, Stock Exchanges and Compliance Officer, each assuming independent regulatory responsibility.

Credits: Arnav Mithal (Associate) & Tarush Bhandari (Associate)