In this article, we will discuss the legal analysis about the obligations of the company and merchant banker during the buyback of shares. Obligations of Company and Merchant Banker in buyback of Shares Obligations of the company in case of buyback: The company shall ensure that: The letter of offer, the public announcement of the offer or any other advertisement, circular, brochure, publicity material contains true, factual & material information & does not contain any misleading information & must state that directors of the company accept the responsibility for information contained in such documents;A company shall not issue any specified securities including by way of the bonus till the date of closure of offer is made under these Regulations;The company shall pay consideration only by cash;The company shall not withdraw the offer to buy-back after draft letter of offer is filed with the SEBI or public announcement of offer to buy-back is made;The promoter or other people shall not deal in specified securities of the company in a stock exchange or off the market, including an inter-se transfer of shares among promoter during the period from a date of passing of such a resolution till the date of closing of the offer.The company shall not raise further capital for the period of 1 year from the closure of buy-back offer, excluding the discharge of its subsisting obligations. No public announcement of buy-back shall be made during the pendency of any scheme of amalgamation or compromise or arrangement pursuant to the provisions of Companies Act 2013. The company should nominate a compliance officer & investor’s service center for compliance with the buy-back regulations & to redress the complaints of the investors. The particulars of said security certificates extinguished & destroyed should be furnished by the company to stock exchanges where the securities of the company are listed, within 7 days of extinguishment & destruction of the certificates. The company shouldn’t buy-back the locked-in securities & non-transferable securities till pendency of the lock-in shares or till the securities become transferable. The company should issue, within the period of 2 days after the completion of buy-back, a public advertisement in a national daily, inter alia, disclosing the following: Also, Read: Method for Buyback of Shares as per Company Act. Number of securities bought;Price at which the securities were bought;Total amount invested in the buy-back;Details of the security-holders from whom securities exceeding one percent of the total securities were bought-back; &The consequent changes in the capital structure & the shareholding pattern after & before the buy-back. Obligations of the merchant banker should ensure that: The company is able to implement the offer;The provision relating to the escrow account has been made;Firm arrangements for monies for the payment to fulfill such obligations under the offer are in place;The public announcement of buy-back is made & the letter of offer has been filed in terms of the Regulations;The merchant banker should provide to SEBI, the due diligence certificate which should accompany a draft letter of offer;The merchant banker should ensure that the contents of the public announcement of an offer as well as the letter of offer are true, fair & adequate & quoting the source wherever necessary.The merchant banker should ensure compliance with Section 77A & Section 77B of the Companies Act, & any other applicable laws or rules as necessaryUpon fulfillment of all obligations by the company under the Regulations, the merchant banker should inform the bank with whom the escrow or special amount has been deposited to release the balance amount to the company & send a final report to SEBI in the specified form, within 15 days from the date of closure of the buy-back offer. Recommended Article: Legal Background of Buyback of Shares under Companies Act 2013.