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SEBI Revises Minimum Information Requirements for Related Party Transaction Approvals
Regulation 23 of SEBI's LODR Regulations, 2015, requires that all related party transactions (RPTs) be approved by the Audit Committee and, where material, by the shareholders. The information to be placed before the audit committee and shareholders, for consideration of RPTs is mandated by a Master Circular dated 11th Nov, 2024. To bring uniformity in disclosures for such approvals, SEBI-through the Industry Standards Forum (comprising ASSOCHAM, CII and FICCI, under the aegis of the stock exchanges)-introduced a common framework on 'Minimum information to be provided to the Audit Committee and Shareholders for approval of Related Party Transactions' (i.e. RPT Industry Standards) earlier this year. Initially mandated from April 1, 2025, and later deferred to July 1, 2025, these standards have since undergone multiple refinements. SEBI's latest Circular dated October 13, 2025, now further revises and simplifies the disclosure framework to ease compliance while retaining transparency in RPT approvals.
Main Relaxation/Change
The latest Circular provides graded disclosure requirements depending on the transaction size. Relaxation in the Minimum information to be provided as per 'RPT Industry Standards' would apply to transactions which do not exceed the lower limit of a) 1% of the annual consolidated turnover of the listed entity or b) INR 10 million. Further, these requirements would not apply to transactions which do not exceed INR 10 million (entered into individually or taken together with previous transactions during a financial year). Corresponding changes are also introduced for notice being sent to the shareholders seeking approval for the RPT.
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Our Comments
The circular comes into effect immediately and all listed companies must align their RPT approval processes and shareholder notices with the revised framework. The update reduces compliance load while maintaining transparency for material transactions. Audit Committees should revisit their templates and internal checklists to ensure readiness.
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