The eligible merchant bankers shall ensure compliance with the following:

1. The offer documents of size upto Rs. 20 crores shall be filed by lead merchant bankers with the concerned regional office of Board under the jurisdiction of which the registered office of the issuer company falls.

2. The jurisdiction of regional offices/ head office shall be as per Schedule XXII.

As per Clause 5.6 of Chapter V of the Guidelines, the draft offer document filed with the Board shall be made public. The lead merchant banker shall make ten (10) copies of the draft offer document available to the dealing office of the Board, three (3) copies to the Primary Market Department, SEBI, Head Office and 25 copies to the stock exchange(s) where the issue is proposed to be listed. Copies of the draft offer document shall be made available to the public by the lead merchant bankers / Stock Exchange. The lead merchant banker and the Stock Exchanges(s) may charge such reasonable charge for providing a copy of the draft offer document(Regulation 16.1.2).

The lead merchant banker shall submit the draft offer document on a computer floppy to the dealing office of the Board and to the Primary Market Department, SEBI, Head Office, as specified in Schedule XXIII..(Regulation 16.1.3.) In case of book built issues the lead merchant banker shall submit a printed and soft copy on a computer floppy, of the draft offer document incorporating the Board’s observations and a printed copy of bid cum application form to the Primary Market Department, SEBI, Head Office at least five days before opening of bidding.

The Lead Merchant Bankers shall submit two copies of final printed copy of the final offer document to dealing offices of Board (within three (3) days of filing offer document with Registrar of Companies / concerned Stock Exchange(s) as the case may be. The lead merchant banker shall submit one final printed copy of the final offer document to Primary Market Department, SEBI, Head Office, within three (3) days of filing the offer document with Registrar of Companies / concerned Stock Exchange(s) as the case may be.) The lead merchant banker shall submit a computer floppy containing the final prospectus/ letter of offer to Primary Market Department, SEBI, Head Office, as specified in Schedule XXIII within three (3) days of filing the final prospectus/ letter of offer with the Registrar of Companies/ concerned Stock Exchange(s). Along with the floppy, the lead manager shall submit an undertaking to SEBI certifying that the contents of the floppy are is in HTML format and are identical to the printed version of prospectus/ letter of offer filed with Registrar of Companies/ concerned Stock Exchange as the case may be.).(Regulation 16.1.4)

Whenever offer documents (for public/ rights issues, takeovers or for any other purpose) are filed with any Department/ office of Board, the following details (about themselves) (certified as correct) shall be given by the lead merchant banker in the forwarding letters (Regulation 16.1.5.)

1. Registration No.

2. Date of Registration / Renewal of registration.

3. Date of expiry of registration.

4. If applied for renewal, date of application.

5. Any communication from the Board prohibiting from acting as a merchant banker.

6. Any inquiry / investigation being conducted by the Board .

The following details about the issuer company certified as correct shall be furnished by the lead merchant banker along with their forwarding letter while filing offer documents for public/ rights issue/ buyback/ takeovers: (Regulation 16.1.5)

1. whether any promoter/ director/ group /associate company/entity of the issuer company and/or any company/entity with which any of the above is associated as promoter/ director/ partner/ proprietor, is/was engaged in securities related business and registered with SEBI.

2. If any one or more of these persons/entities are/ were registered with SEBI, their respective registration numbers.

3. If registration has expired, reasons for non renewal.

4. Details of any enquiry / investigation conducted by SEBI at any time.

Penalty imposed by SEBI (Penalty includes deficiency/warning letter, adjudication proceedings, suspension / cancellation / prohibitory orders)

Outstanding fees payable to SEBI by these entities, if any.

The draft and final offer documents submitted to the Board on computer floppies shall be accompanied by the information as per format in Schedule XXIIIA. (Regulation 16.1.5). Offer documents not accompanied by the information as above may be rejected.

Lead Merchant Bankers shall obtain similar information from other intermediaries to ensure that they comply with these guidelines and are eligible to be associated with the concerned issue.

The intermediaries shall also indicate in their letters that they have obtained such information from other intermediaries. (Regulation 16.1.7)

(a) Lead merchant bankers shall ensure that whenever there is a reservation for NRIs, 10 copies of the prospectus together with 1000 application forms are despatched in advance of the issue opening date directly along with a letter addressed in person to Adviser (NRI), Indian Investment Centre, Jeevan Vihar Bldg., Sansad Marg, New Delhi - 110001.

(b) Twenty copies of the prospectus and application forms shall be despatched in advance of the issue opening date to the various Investors Associations.

(a) While selecting underwriters and finalising underwriting arrangements, lead merchant bankers shall ensure that the underwriters do not overexpose themselves so that it may become difficult to fulfil underwriting commitments.

(b) The overall exposure of underwriter(s) belonging to the same group or management in an issue shall be assessed carefully by the lead Merchant Banker.

(c) OTC Dealers registered with Board under Securities and Exchange Board of India (Stock Brokers and Sub-Brokers) Rules and Regulations, 1992 shall be treated at par with the brokers of other stock exchanges in respect of underwriting arrangement.

The merchant banker shall ensure compliance with the following post-issue obligations:

1. The merchant bankers shall assign high priority to investor grievances and take all preventive steps to minimise the number of complaints.

2. The lead merchant banker shall set up proper grievance monitoring and redressal system in co-ordination with the issuers and the Registrars to Issue, and take all necessary measures to resolve the grievances quickly.

The merchant bankers shall actively associate with the post-issue refund and allotment activities and regularly monitor investor grievances arising therefrom.

1. The concerned lead merchant banker shall submit, in duplicate, the Post Issue Monitoring Reports specified in Clause 7.2 of Chapter VII of these Guidelines, within 3 working days from the due dates either by registered post or deliver at respective regional offices/ head office at the addresses given in Schedule XXII

2. Where the offer document has been dealt with by any of the regional offices of the Board, a copy of the report shall be sent to the Board's Head office, Mumbai.

The Lead Merchant Banker(s) shall inform the Board on important developments about the particular issues being lead managed by them during the intervening period of the reports.

1. As per the Listing Agreement of the Stock Exchanges, the issuer companies shall deposit 1% of the amount of securities offered to the public and/or to the holders of the existing securities of the company, as the case may be, with the regional Stock Exchange, which can be released by the concerned stock exchange only after obtaining an NOC from the Board.

2. An application for NOC shall be submitted by issuer company to the Board in the format specified in Schedule XXIV.

The following conditions shall be complied before submitting the application for issue of NOC

1. Completion of 4 months from the date of obtaining the listing permission from the concerned Regional Stock Exchange or the last date when the listing permission was obtained from any of the other stock exchanges, where the securities are proposed to be listed, whichever is later.

2. Satisfactory redressal of all complaints received at the Board against the Company.

3. Certificate from the Regional Stock Exchange to the issuer company to the effect that underwriting/brokerage commission as well as Registrars/Lead merchant bankers fees have been duly paid by the company.

Applications for issue of NOC shall be filed by merchant bankers with the concerned regional office of Board under the jurisdiction to which the registered office of the issuer company falls, as specified in Schedule XXII. In cases where issues (i.e. public/rights/offer of sale or any other) fail and the investors monies are fully refunded, an NOC from the Board may not be required and the concerned regional Stock Exchange can refund the 1% security deposit after duly verifying that the refund orders have actually been despatched.

1. The complaints with respect to non-receipt of underwriting /brokerage commission and non-receipt of Registrars/Lead merchant bankers fees may be filed with the concerned Regional Stock Exchanges.

2. Responses against complaints forwarded by the Board to the concerned companies shall be submitted to the Board as per the proforma specified in Schedule XXV for updation of records.

1. Application for renewal of Certificate of Registration shall be made by the Merchant Bankers as per regulation 9 of Securities and Exchange Board of India (Merchant Bankers) Rules and Regulations, 1992.

2. While filing the renewal application for the certificate of registration as merchant banker, it shall provide a statement highlighting the changes that have taken place in the information that was submitted to the Board for the earlier registration and a declaration stating that no other changes other than as mentioned in the above statement has taken place.

3. Merchant Bankers while forwarding the renewal application in form A as per Securities and Exchange Board of India (Merchant Bankers) Rules and Regulations, 1992, shall also forward the additional information as specified in Schedule XXVI.

1. In terms of regulation 28 of Securities and Exchange Board of India (Merchant Bankers Regulation) 1992, the merchant bankers shall send half yearly report in the format specified at Schedule XXVII relating to their merchant banking activities.

2. The report referred to in sub-clause (a) shall be submitted twice a year, as on March 31 and September 30 and it should reach the Board within three months from the close of the period to which it relates.

Registered Merchant Bankers shall inform the Board of their having become a member of AMBI with relevant details.

1. Penalty points may be imposed on the merchant banker for violation of any of the provisions of operational guidelines under these Chapters.

2. The Merchant Banker, on whom penalty point of four or more has been imposed may be restrained from filing any offer document or associating or managing any issues for a particular period.

3. The Board may initiate action under the SEBI (Merchant Bankers) Regulations against the Merchant Bankers, irrespective of whether any penalty point is imposed or not.

4. Imposition of penalty point is not a condition precedent for initiation of proceeding against the Merchant Banker under the Securities and Exchange Board of India (Merchant Bankers) Regulations.

In case of violation of these Guidelines, the Board may in the interest of the securities market and in the interest of the investors may pass the following directions under section 11B:

1. (a) directing the persons concerned to refund any money collected under an issue to the investors with or without requisite interest, as the case may be.

2. directing the persons concerned not to access the capital market for a particular period.

3. directing the stock exchange concerned not to list or permit trading in the securities.

4. directing the stock exchange concerned to forfeit the security deposit deposited by the issuer company.

5. any other direction which the Board may deem fit and proper in the circumstances of the case.

Provided that before issuing any directions the Board may give a reasonable opportunity to the person concerned. Provided further that if any interim direction is sought to be passed, the Board may give post decisional hearing to such person.

Action against intermediaries (Clause 17.2)