The regulations shall apply to listed entity which has listed any of the designated securities namely specified securities, non-convertible debt securities, non-convertible redeemable preference shares, perpetual debt instrument, perpetual non-cumulative preference shares, Indian depository receipts, securitised debt instruments, security receipts, units issued by mutual funds and any other securities as may be specified on recognised SE.
I will be attempting, discussing briefly and re-constructing specific compliances that need to be complied w.r.t. Chapter V (Obligations of Listed Entity which has Listed its Non-Convertible Securities) which shall be applicable only to listed entity which has listed its non-convertible securities (“NCS”) on a recognised SE and penal actions for non-compliance with provisions related to continuous disclosures.
Apart from Chapter III which enlists Common Obligations of all listed entities the Reg. 49 to Reg. 62 are specifically applicable to that listed entity which has listed their NCS on recognised Stock Exchange(s) (“SE”).
Reg. 49 Applicability: Applicable to listed entity which has listed their NCS on recognised SE(s).
Reg. 50 Intimation to SE (s): 2 days Prior intimation of BM to SE for proposals:
1. Alteration in the form or nature of NCS
2. Financial Results
3. Fund Raising
4. Other matter affecting rights or interests of NCS holders
also intimate to SE: AGM, EGM for matters financial results, fund raising and other matters affecting rights or interests of NCS holders.
*Non Compliance will lead to fine payable: Rs. 5000 per instance of non-compliance per item
Reg. 51 *Disclosure of information having bearing on performance/operation of listed entity and/or price sensitive information: Listed entity shall promptly (not later than 24 hours) inform the SEs and listed entity shall also disclose on its website.
* Disclosures as specified in Part B of Schedule III
Reg. 52 Financial Results: Listed entity shall prepare and submit to SE and to Debenture Trustee un-audited or audited quarterly and year to date standalone financial results on a quarterly basis – within 45 days from end of the quarter.
The annual audited standalone and consolidated financial results for the financial year shall be submitted to the SE(s) within sixty days from the end of the financial year along with the audit report.
*Non Compliance will lead to fine payable: Rs. 5000 per day.
*Non-disclosure of line items prescribed under Reg. 52(4) and Reg. 52(6): Rs. 1000 per day.
*Non-submission of Certificate signed by Debn. Trustee under Reg. 52 (4): Rs. 1000 per day.
*Non-submission of deviations/variations in utilization of issue proceeds under Reg. 52(7): Rs. 1000 per day
Reg. 53 Annual Reports: The annual report of the listed entity shall contain disclosures as specified in Companies Act, 2013 along with audited financial statements, cash flow statement, auditors report, directors report, name of the debenture trustees with full contact details, etc.,
The listed entity shall submit annual report sent to the shareholders along with the notice of the annual general meeting, to the SE and the debenture trustee and publish on its website.
Reg. 54 Asset Cover: The listed entity shall maintain hundred per cent. asset cover or higher asset cover and shall disclose to the SE in quarterly, half-yearly, year-to-date and annual financial statements, as applicable.
*Non-disclosure of extent and nature of security created and maintained: Rs. 1000 per day.
Reg. 55 Credit Rating: Credit Rating shall be reviewed at least once a year by a credit rating agency registered by the Board.
Reg. 56 Documents and Intimation to Debenture Trustees: listed entity shall forward the following to the debenture trustee promptly:
- copy of the annual report,
- copy of all notices, resolutions and circulars,
- revision in the rating;
- default in timely payment of interest or redemption
- failure to create charge on the assets
- all covenants of the issue,
- a half-yearly certificate regarding maintenance of hundred percent asset cover or higher asset cover
- all material events and/or information as disclosed under regulation 51
- information sought and provide access to relevant books of accounts
Reg. 57 Intimations other submissions to SE(s): The listed entity shall submit a certificate to the SE within one working day of the interest or dividend or principal becoming due regarding status of payment in case of non-convertible securities.
The listed entity shall within five working days prior to the beginning of the quarter provide details for all the non-convertible securities for which interest/dividend/principal obligations shall be payable during the quarter.
The listed entity shall within seven working days from the end of the quarter provide:
(a) a certificate confirming the payment of interest/dividend/principal obligations for non-convertible securities which were due in that quarter; and
(b) the details of all unpaid interest/dividend/principal obligations in relation to non-convertible securities at the end of the quarter.
*Non-disclosure of information related to payment obligations: Rs. 1000 per day per ISIN
Reg. 58 Documents and information to holders of non-convertible securities: listed entity shall send:
- Soft copies of the full annual reports to holders of non-convertible securities who has registered their email address(es)
- Hard copy of statement containing the salient features of all the documents
- Hard copies of full annual reports to those holders of non-convertible securities who request for the same.
- notice of all meetings of holders of non-convertible debt securities and holders of non-convertible redeemable preference shares
- listed entity shall send proxy forms to holders of non-convertible debt securities and non-convertible redeemable preference shares.
Reg. 59 Structure of non-convertible debt securities and non-convertible redeemable preference shares: The listed entity shall not make material modification without prior approval of the SE(s) in terms of coupon, dividend, redemption, or otherwise.
*Failure to obtain prior approval of SE for any structural change – Rs. 50,000 per instance
Reg. 60 Record Date:
The listed entity shall fix a record date and shall give notice in advance of at least seven working days for purposes of payment of interest, dividend and payment of redemption or repayment amount or for such other purposes as specified by the SE.
*Delay in submission of the notice of record date: Rs. 10,000 per ISIN
Reg. 61 Terms of non-convertible debt securities and non-convertible redeemable preference shares: The listed entity shall ensure timely payment of interest or dividend.
Reg. 61A Dealing with unclaimed non-convertible securities and benefits accrued thereon: The listed entity shall not forfeit unclaimed interest/dividend/redemption amount and within seven days from the date of expiry of the period of thirty days, transfer the amount to an escrow account to be opened by the listed entity in any scheduled bank.
Any amount transferred to the escrow account that remains unclaimed for seven years shall be transferred to the ‘Investor Education and Protection Fund’.
Reg. 62 Website: The listed entity shall maintain a functional website containing:
- details of its business
- composition of the Board
- financial information
- contact information of the designated officials
- email address for grievance redressal and other relevant details
- name of the debenture trustees with full contact details
- the information, report, notices, call letters, circulars, proceedings, etc concerning non-convertible redeemable preference shares or non-convertible debt securities
- all information and reports including compliance reports filed by the listed entity
- information with respect default payment of interest/dividend, redemption
- failure to create a charge on the assets
- all credit ratings
- statements of deviation(s) or variation(s)
- annual returns
The listed entity shall ensure that the contents of the website are correct and updated at any given point of time.
The listed entity shall update any change in the content of its website within two working days from the date of such change in content.
*Non-compliance with norms pertaining to functional website: Rs. 10,000 per instances after four advisory/warning letter.
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