Sebi committee proposes higher sweat equity for new economy firms

Group recommends inclusion of permissible reasons for issuance along with cap on quantum to be issued in sweat equity regulations

A seven member committee appointed by the Securities and Exchange Board of India (Sebi) has batted for relaxations with respect to the quantum of sweat equity that can be issued by new economy firms listed on the Innovators Growth Platform, a public market platform for such firms that employ technology, data analytics, bio-technology or nano-technology to provide products and services extensively.

The expert group, in its 141-page discussion paper, has suggested combining two separate regulations--Sebi (Share Based Employee Benefits) Regulations, 2014, or SBEB, and Sebi (Issue Of Sweat Equity) Regulations, 2002--that deal with employee compensation.

The group recommended that the