Shareholding

(1) No person shall at any time, directly or indirectly, either by itself or together with persons acting in concert, acquire or hold more than ten per cent of the paid-up equity share capital or total voting power of an information utility: Provided that the following persons may, directly or indirectly, either by themselves or together in concert, acquire or hold up to twenty-five percent of the paid-up equity share capital or total voting power of an information utility:- (a) government company; (b) stock exchange; (c) depository; (d) bank; (e) insurance company; and (f) public financial institution. (2) 18[Notwithstanding anything to the contrary contained in sub-regulation (1) – (a) a person may, directly or indirectly, either by itself or together with persons acting in concert, hold up to fifty-one percent of the paid-up equity share capital or total voting power of an information utility up to three years from the date of its registration; or (b) an Indian company, (i) which is listed on a recognised Stock Exchange in India, or (ii) where no individual, directly or indirectly, either by himself or together with persons acting in concert, holds more than ten percent of the paid-up equity share capital, may hold up to hundred percent of the paid-up equity share capital or total voting power of an information utility up to three years from the date of its registration. Provided that the information utility is registered before 30th September, 2018.] 18 Substituted by Notification No. IBBI/2017-18/GN/REG016 dated 29th September, 2017 (w.e.f. 29-9-2017). Prior to this substitution, Regulation 8(2) stood as under: - “8(2). Notwithstanding anything to the contrary contained in sub-regulation (1), a person resident in India may, directly or indirectly, either by itself or together with persons acting in concert, hold up to fifty-one percent of the paid-up equity share capital or total voting power of an information utility till the expiry of three years from the date of its registration, or such period as may be extended by the Board.”

(3) The provisions of this Regulation shall not apply to the holding of shares or voting power by the Central Government or a State Government. 19[9. Composition of the Governing Board. (1) The Governing Board shall consist of - (a) managing director; (b) independent directors; and (c) shareholder directors: Provided that more than half of the directors shall be citizens of India and shall be residents in India. (2) The managing director shall not be considered either an independent director or a shareholder director. (3) Any employee of an information utility may be appointed as a director on its Governing Board in addition to the managing director, but such director shall be deemed to be a shareholder director. (4) The number of independent directors shall not be less than the number of shareholder directors: Provided that no meeting of the Governing Board shall be held without the presence of at least one independent director. (5) An independent director shall be an individual- (a) who is a person of ability and integrity; (b) who has expertise in the field of finance, law, management or insolvency; (c) who is not a relative of the directors of the Governing Board; (d) who has or had no pecuniary relationship with the information utility, or any of its directors, or any of its shareholders holding more than ten per cent. of its share capital, during the immediately preceding two financial years or during the current financial year; (e) who is not a shareholder of the information utility; and 19 Substituted by Notification No. IBBI/2018-19/GN/REG034 dated 11th October, 2018 (w.e.f. 11-10-2018). Regulation 9, before substitution stood as under: “9. Composition of the Governing Board. (1) More than half of the directors of an information utility shall be independent directors at the time of their appointment, and at all times during their tenure as directors: Provided that no meeting of the Governing Board shall be held without the presence of at least one independent director. 19[(1A) More than half of the directors of an information utility shall be Indian nationals and resident in India] (2) The directors shall elect an independent director as the Chairperson of the Governing Board: Explanation- For the purposes of this Regulation, any fraction contained in ‘more than half’ shall be rounded off to the next higher number.”

(f) who is not a member of the Board of Directors of any of the shareholders holding more than ten per cent. of the share capital of the information utility. (6) An independent director shall be nominated by the Board from amongst the list of names proposed by the information utility. (7) An individual may serve as an independent director for a maximum of two terms of three years each or part thereof, or up to the age of 20[seventy-five years], whichever is earlier. (8) The second term referred to in sub-regulation (7) may be subject to a satisfactory performance review of the first term by the Governing Board. (9) A cooling off period of three years shall be applicable for an independent director to become a shareholder director in the same or another information utility. (10) The directors shall elect an independent director as the Chairperson of the Governing Board. (11) A director, who has any interest, direct or indirect, pecuniary or otherwise, in any matter coming up for consideration at a meeting of the Governing Board or any of its Committees, shall as soon as possible after relevant circumstances have come to his knowledge, disclose the nature of his interest at such meeting and such disclosure shall be recorded in the proceedings of the Governing Board or the Committee, as the case may be, and the director shall not take part in any deliberation or decision of the Governing Board or the Committee with respect to that matter.