SEBI scraps requirement for PAN, KYC, and nomination for physical securities holders

Additionally, as per a circular issued in May, folios lacking any of these documents were to be frozen by the Registrars to an Issue and Share Transfer Agents (RTA).

In an amendment to the previously issued circular from May, SEBI removed references to 'freezing/frozen'. This decision follows extensive consultations and feedback from various stakeholders, including the Registrars’ Association of India and investors.

SEBI cited multiple reasons for this reversal. The decision emerged from feedback received from the Registrars’ Association of India and investors. Additionally, the intention is to mitigate unforeseen challenges arising from the freezing of folios and the subsequent referral of frozen folios to the administering authority under the Benami Transactions (Prohibitions) Act, 1988, and/or the Prevention of Money Laundering Act, 2002.

Furthermore, the requirement to refer frozen folios to the administering authority under the aforementioned acts, if they remained frozen as of December 31, 2025, has been revoked.

This shift in SEBI's regulations regarding physical securities holders in listed companies marks a significant departure from the previous stringent requirements, aiming to simplify the process and reduce inadvertent complications that arose from freezing folios.