'Compulsory delisting is different from voluntary delisting'. Critically examine.

CS Executive · Capital Markets & Securities Laws · PYQS · June 2019
'Compulsory delisting is different from voluntary delisting'. Critically examine.

Answer & Explanation:

Compulsory delisting refers to permanent removal of securities of a listed company from a stock exchange as a penalizing measure at the behest of the stock exchange for not making submissions/comply with various requirements set out in the listing agreement within the time frames prescribed. In voluntary delisting, a listed company decides on its own to permanently remove its securities from a stock exchange. In case of voluntary delisting company cannot make public issue for next 5 years after delisting but in case of compulsory delisting company cannot make public issue for next 10 years after delisting. In case of voluntary delisting pricing norm shall be applicable but in case of compulsory delisting no such norm are there.

Topics: Delisting of Securities

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