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SEBI has merged the debt securities rules into a single regulation

The Securities and Exchange Board of India (SEBI) has merged the rules relating to the issuance of debt securities into a single regulation. The Issue and Listing of Debt Securities (ILDS) Rules and the Non-Convertible Redeemable Preference Shares (NCRPS) Rules have been merged to create the SEBI (Issue and Listing of Non-Convertible Securities) Regulations. Under this framework, with the exception of unlisted real estate investment trusts (REITs) and infrastructure investment trusts (InvITs), issuers who have been in existence for less than 3 years, will be able to tap the bond market under certain conditions. Parameters for the identification of risk factors have also been introduced to assist issuers in disclosing pertinent risk factors.

A call and put option has been introduced in case of debt securities issued on a private placement basis. Provisions have also been harmonized with the Companies Act, to provide greater flexibility to issuers. SEBI has issued operational guidelines for the issuance, listing and trading of nonconvertible securities, securitised debt instruments, security receipts, municipal debt securities and commercial papers. Guidelines have also been released regarding timelines and additional disclosure requirements. The regulations will come into effect on August 16, 2021.

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