Sebi's royalty move to discourage foreign firms from going public: Industry

Firms not in favour of greater say to minority shareholders, call move 'discriminatory'

The Securities and Exchange Board of India’s (Sebi’s) decision, to give minority shareholders a greater say in deciding royalty payments by listed companies, has attracted adverse feedback, reveals a note uploaded on the regulator’s website.
 
Starting this month, listed companies had to seek approval from ‘majority of minority’ shareholders for making royalty payments to a related party, with respect to brand usage exceeding 2 per cent of the annual consolidated turnover.
 
However, the adverse feedback has forced the regulator to re-think the move and defer implementation till June 30.
 
In a board meeting memorandum, Sebi has listed