SEBI issues Guidelines to enhance disclosure in case of listed debt securities

May 28, 2019 | by Avantis RegTech Legal Research Team

The Securities and Exchange Board of India (SEBI) on May 27, 2019 has issued guidelines to enhance disclosure in case of listed debt securities.

SEBI had issued vide Gazette Notifications No. 150, 151, 152 dated May 7, 2019 to further secure the interests of investors in listed debt securities, enhance transparency and to enable Debenture Trustees (DTs) to perform their duties effectively and promptly, pursuant to public consultation, amendments to the existing regulatory framework for governing Debenture Trustees (DTs).

Therefore, after taking into consideration the comments received from the public, the following guidelines are being issued:

1. Disclosure of compensation arrangement with clients by DTs on their websites.

2. Calendar of interest/ redemptions, due and paid, to be displayed on the website of DT(s) for the financial year:

a.DTs shall display on their website the ISIN wise details of interest/ redemption due to the debenture holders in respect of all issues during a financial year within 5 working days of start of financial year.

b.DTs shall also update the status of payment ISIN-wise against such issuers not later than 1 day from the due date. 

3. Registrars to an Issue and Share Transfer Agent (RTA) / Issuers shall henceforth forward the details of debenture holders to the DT at the time of allotment and thereafter by the seventh working day of every next month.

4. Additional covenants in case of privately placed issues:

a.In privately placed issues, additional Covenants as under, shall be included as part of the Issue Details in the summary term sheet, as per the agreement between the issuer and investor: (i) Default in Payment and (ii) Delay in Listing.

b.It is clarified that amendments may be made, to incorporate the aforesaid additional covenants in the summary term sheet issued and/or agreement executed on or after May 7, 2019. 

[Circular No. SEBI/ HO/ MIRSD/ DOS3/CIR/P/2019/68]

Click here to download the Circular.


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