SEBI Issues Master Circular on Non-Convertible Securities and Related Instruments

On May 22, 2024, the Securities and Exchange Board of India (SEBI) issued a Master Circular addressing the issuance and listing of Non-Convertible Securities, Securitised Debt Instruments, Security Receipts, Municipal Debt Securities, and Commercial Paper, effective immediately.

This Master Circular consolidates previous guidelines and provides a comprehensive framework for issuers, intermediaries, and stakeholders, enhancing regulatory clarity, promoting compliance, and ensuring the integrity and efficiency of India’s financial markets.

Stakeholders are urged to familiarize themselves with the new provisions to navigate the regulatory landscape effectively.

The Master Circular incorporates multiple previous circulars issued following the merger and repeal of the SEBI (Issue and Listing of Debt Securities) Regulations, 2008, and SEBI (Issue and Listing of Non-Convertible Redeemable Preference Shares) Regulations, 2013.

Circulars now incorporated include:

  • July 7, 2023: Master Circular for issue and listing of Non-convertible Securities, Securitised Debt Instruments, Security Receipts, Municipal Debt Securities, and Commercial Paper.
  • September 4, 2023: New format of Abridged Prospectus for public issues of Non-Convertible Debt Securities and/or Non-convertible Redeemable Preference Shares.
  • October 19, 2023: Revisions to enhance corporate bond market development and ease of business for large corporate debt issuers.
  • December 28, 2023: Modifications to Chapter XXI of NCS Master Circular regarding Online Bond Platform Providers.

Recognized stock exchanges, depositories, SEBI registered members, issuers, and other stakeholders are directed to:

  • Make the Master Circular available on their websites.
  • Comply with the circular’s conditions.
  • Establish necessary systems and infrastructure for implementation.
  • Adjust bye-laws, rules, regulations, or bidding portals as required.
  • Raise awareness among stakeholders.
  • Monitor compliance by issuer companies.

Any pending actions or applications under the rescinded circulars will be deemed to fall under the provisions of the new Master Circular.