Sebi merges debt securities rules into single regulation

To ease the compliance burden on listed entities, Sebi has merged rules pertaining to the issuance of debt securities into a single regulation.

The move comes after the board of Sebi approved a proposal in this regard in June.

As per the notification, the regulator merged ILDS (Issue and Listing of Debt Securities) rules and NCRPS (Non-Convertible Redeemable Preference Shares) rules into a single regulation to be called — Sebi (Issue and Listing of Non-Convertible Securities) Regulations.

Under the new framework, issuers other than unlisted REITs (Real estate investment trusts) and InvITs (Infrastructure investment trusts), who are in existence for less than 3 years, have been facilitated to tap the bond market on certain conditions, according to a notification issued on Monday.

This condition includes the issuance of their debt securities is made only on a private placement basis; the issue is made on the EBP (electronic book mechanism) platform irrespective of the issue size, and the issue is open for subscription only to qualified institutional buyers (QIBs).

The move will enable special purpose vehicles created for specific infrastructure purposes, NBFCs, listed REITs as well as InvITs and other companies who propose to list debt securities purely on a private placement basis, but who do not have a three-year existence history, to list their debt securities issued on private placement basis.