Companies to transfer shares to the newly created Special Demat Account of the IEPF Authority
The Ministry of Corporate Affairs (“MCA”) has recently issued a circular relating to transfer of shares to the Investor Education and Protection Fund Authority(“Authority”).
It has been informed through the circular that the Authority has decided to open a Special Demat Account with the National Securities Depository Limited (NSDL) through a Depository Participant of NSDL. This Special Demat Account will have features and functionality to support IEPF operations using paperless, digital processes and facilitate record keeping of shares transferred to the Authority. The details of the Demat Account will be issued in due course.
Therefore, the Circular has directed all companies to do the following :
1. Transfer such shares which are required to be transfer shares to the IEPF Authority under the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, to the Special Demat Account.
2. Provide the information related to the shareholders whose shares are being transferred to the IEPF’s demat account, to NSDL.
i. The NSDL will prescribe file formats and operational procedures for transfer of shares to Special Demat Account of the IEPF Authority by 20th April, 2017 and 15th May, 2017 respectively.
ii. The charges to be levied by NSDL to the companies towards upload and maintenance of records relating to shares transferred to the Special Demat Account of the IEPF are as follows:
a. Transaction fee at the time of effecting shares to Demat Account: Rs. 10/- per record subject to minimum of Rs.500/-.
b. Annual Maintenance Fees: Rs.11/- per record subject to minimum based on paid-up capital of the company as mentioned in the page 2 of the link:http://www.mca.gov.in/Ministry/pdf/Circular_27042017.pdf ].
Source: Ministry of Corporate Affairs