The Securities and Exchange Board of India (SEBI) has notified the SEBI (Buy-Back of Securities) (Amendment) Regulations, 2026, introducing significant changes to the buy-back framework under the SEBI (Buy-Back of Securities) Regulations, 2018. The amendments will come into force on August 1, 2026.
A key amendment allows companies undertaking buy-backs to dispense with the appointment of a merchant banker. Where a merchant banker is not appointed, the regulations redistribute the responsibilities traditionally discharged by merchant bankers among the company, secretarial auditor, statutory auditor, stock exchanges and the compliance officer. The notification specifies the authority responsible for each regulatory obligation, including due diligence certification, oversight of escrow accounts, certification of sell orders, destruction of securities and submission of the final report.
The amended regulations also introduce a cap on open market buy-backs through the stock exchange. From August 1, 2026, the size of such buy-backs must be less than 15% of the company’s paid-up capital and free reserves, calculated on both standalone and consolidated financial statements.
Further, SEBI has clarified that a company shall not undertake a buy-back if it would result in a breach of the minimum public shareholding requirements prescribed under the Securities Contracts (Regulation) Rules, 1957 or the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The amendments also revise procedural timelines. Public announcements must now be made within two working days of the board resolution or declaration of postal ballot results, and companies must electronically intimate shareholders of open market buy-back offers within one working day of the public announcement. Additionally, from August 1, 2026, open market buy-back offers must open within four working days of the public announcement and close within 66 working days from the date of opening.
Also read Delhi High Court Orders Unblocking of Cockroach Janata Party’s X Account
The notification also introduces safeguards relating to promoter shareholding by requiring shares or specified securities held by promoters and the promoter group to remain frozen at the ISIN level during the buy-back period, subject to limited exceptions for tender offers and invocation of pre-existing encumbrances. Several other amendments streamline escrow requirements, disclosure obligations and procedural compliances under the 2018 Regulations