The Securities and Exchange Board of India (SEBI) plays a pivotal role in regulating financial markets. Among its many regulations, the guidelines for Debenture Trustees are crucial for ensuring transparency and investor protection in the corporate bond market. T
The Master Circular for Debenture Trustees consolidates various circulars and regulations pertinent to their functioning. It serves as a comprehensive guide for Debenture Trustees, elucidating procedural, disclosure, and compliance requirements. By compiling existing circulars and incorporating subsequent changes, SEBI aims to streamline regulations and facilitate easier access for stakeholders.
One of the primary objectives of the Master Circular is to enhance the regulation of the corporate bond market. With the proliferation of debt securities and the increasing complexity of financial instruments, robust oversight mechanisms are essential to maintain market integrity and investor confidence. By mandating compliance with the stipulations outlined in the Circular, SEBI seeks to uphold the highest standards of governance and accountability among Debenture Trustees.
The Circular underscores the responsibility of Debenture Trustees to adhere to prescribed conditions diligently. It emphasizes the imperative for Debenture Trustees to establish robust systems and infrastructure to ensure seamless implementation of regulatory requirements. Furthermore, the onus lies with the Board of Directors of Debenture Trustees to oversee compliance and enforce regulatory provisions effectively.
SEBI invokes its statutory powers under various provisions, including the SEBI Act, Debenture Trustees Regulations, and other relevant statutes, to promulgate this Circular. These regulatory frameworks empower SEBI to safeguard investor interests, promote market development, and uphold the integrity of the securities market.
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Securities and Exchange Board of India
Master Circular No. SEBI/HO/DDHS-PoD3/P/CIR/2023/46 Dated: May 16, 2024
To
All Registered Debenture Trustees,
Trustees Association of India (TAI)
All Registered Credit Rating Agencies,
Issuers who have listed and/ or propose to list Debt Securities and Municipal Debt Securities
Recognized Stock Exchanges and Recognized Depositories
Madam/ Sir,
Sub: Master Circular for Debenture Trustees
1. Debenture Trustees are regulated under the provisions of Securities and Exchange Board of India (Debenture Trustees) Regulations, 1993 (‘DT Regulations’). While the broad framework for Debenture Trustees has been laid down in the DT Regulations, over the years, procedural/ disclosure requirements and obligations have been specified by SEBI through circulars.
2. For effective regulation of the corporate bond market and to enable the Debenture Trustees and other market stakeholders to get access to all the applicable circulars at one place, this Master Circular has been prepared.
3. This Master Circular is a compilation of the existing circulars as on May 16, 2024, with consequent changes. The stipulations contained in these circulars have been detailed chapter-wise in this Master Circular. Accordingly, the list of existing circulars for DTs which have been superseded by this Master Circular is placed Annex-1.
4. Notwithstanding such rescission, –
4.1 anything done or any action taken or purported to have been done or taken under the rescinded circulars, prior to such rescission, shall be deemed to have been done or taken under the corresponding provisions of this Master Circular; and
4.2 any application made to the Board under the rescinded circulars, prior to such rescission, and pending before it shall be deemed to have been made under the corresponding provisions of these regulations;
5. Debenture Trustees are directed to comply with the conditions laid down in this Master Circular and it is reiterated that Debenture Trustees shall have necessary systems and infrastructure in place for implementation of this circular. The Board of Directors of the Debenture Trustee shall be responsible for ensuring compliance with these provisions
6. This Circular is issued in exercise of powers conferred under:
1.1 Section 11(1) of Securities and Exchange Board of India Act, 1992;
1.2 Regulation 2A of the Securities and Exchange Board of India (Debenture Trustees) Regulations, 1993
1.3 Regulation 55 of the Securities and Exchange Board of India (Issue and Listing of Non-Convertible Securities) Regulations, 2021; (‘SEBI NCS Regulations’)
1.4 Regulation 29 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015;
1.5 Regulation 101 (1) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘SEBI LODR Regulations’) to protect the interest of investors in securities and to promote the development of, and to regulate, the securities market.
Yours faithfully,
Sarika Kataria
Deputy General Manager
Department of Debt and Hybrid Securities
Tel No. 022-2644-9411
Email ID – [email protected]
