The Securities and Exchange Board of India (“SEBI”) has notified ‘September 01, 2025’ as the effective date for revised Industry Standards on “Minimum Information to be provided to the Audit Committee and Shareholders for approval of Related Party Transactions (“RPT Industry Standards”).

In response to the requests for simplification of the previously issued Industry Standards on Minimum Information to be provided to the Audit Committee and Shareholders for approval of Related Party Transactions, the Industry Standards Forum (ISF) has finalised the revised RPT Industry Standard. The revised standard will substitute the earlier version of Industry Standards as notified by SEBI vide circular dated February 14, 2025.

Key highlights of the revised RPT Industry Standards are mentioned below:

1. The applicability of RPT Industry Standard has been modified to specifically exclude the following transactions:
   • Transactions exempted under Regulation 23(5)* of the LODR Regulations; and
   • Quarterly review of RPTs by the Audit Committee in terms of Regulation 23(3)(d)** of the LODR Regulations.
   • Transaction(s) with a related party to be entered into individually or taken together with previous transactions during a financial year (including which are approved by way of ratification) do not exceed Rs. One Crore.
2. Following are the clarifications issued on the applicability of the RPT Industry Standards:
   • If the Audit Committee and/or shareholders have granted approval before effective date (as provided above), for RPTs to be executed on or after effective date, then it will not be necessary for the listed entity to seek approval during the validity of the approval unless there is any material modification to such RPTs which is presented to Audit Committee after effective date.
   • If omnibus approval has been granted before effective date for RPTs for the financial year 2025-26, then the listed entity is not required to seek fresh approval with disclosures as per the RPT Industry Standards. However, any material modification to such RPTs on or after effective date, shall be subject to the RPT Industry Standards.
   • If a Material RPT is approved by Audit Committee before effective date, the RPT Industry Standards shall not apply, irrespective of whether the notice to shareholders is sent either before or on or after the effective date.

The RPT Industry Standard as published in BSE’s website is attached herewith for your reference.

Additionally, refer the circular hyperlinked below for ease of reference.

Source: SEBI

*The provisions of sub-regulations (2), (3) and (4) shall not be applicable in the following cases:
(a) transactions entered into between two public sector companies;
(b) transactions entered into between a holding company and its wholly owned subsidiary whose accounts are consolidated with such holding company and placed before the shareholders at the general meeting for approval.

(c) transactions entered into between two wholly-owned subsidiaries of the listed holding company, whose accounts are consolidated with such holding company and placed before the shareholders at the general meeting for approval.
(d) transactions which are in the nature of payment of statutory dues, statutory fees or statutory charges entered into between an entity on one hand and the Central Government or any State Government or any combination thereof on the other hand.
(e) transactions entered into between a public sector company on one hand and the Central Government or any State Government or any combination thereof on the other hand.

** Audit committee may grant omnibus approval for related party transactions proposed to be entered into by the listed entity or its subsidiary subject to the following conditions, namely-

1. the audit committee shall lay down the criteria for granting the omnibus approval in line with the policy on related party transactions and such approval shall be applicable in respect of transactions which are repetitive in nature;

2. the audit committee shall satisfy itself regarding the need for such omnibus approval and that such approval is in the interest of the listed entity;

3. the omnibus approval shall specify:

(i) the name(s) of the related party, nature  of  transaction,  period  of transaction, maximum amount of transactions that shall be entered into,

(ii) the indicative base price / current contracted price and the formula for variation in the price if any; and
(iii) such other conditions as the audit committee may deem fit:

Provided that where the need for related party transaction cannot be foreseen and aforesaid details are not available, audit committee may grant omnibus approval for such transactions subject to their value not exceeding rupees one crore per transaction.

4. the audit committee shall review, at least on a quarterly basis, the details of related party transactions entered into by the listed entity or its subsidiary pursuant to each of the omnibus approvals given.

5. Such omnibus approvals shall be valid for a period not exceeding one year and shall require fresh approvals after the expiry of one year.

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