Credit Rating Agencies
1. Are there any relaxations/exemptions provided by the Securities and Exchange Board of India (SEBI) to the Credit Rating Agencies registered with SEBI due to the pandemic Covid-19?
Answer: Considering the outbreak of Covid – 19 and the 21 day lockdown in India, the Reserve Bank of India (RBI) had permitted moratorium on loan servicing, working capital facilities etc. for a period of three months. The same was allowed vide Notification No. RBI/2019-20/186, dated March 27, 2020.
Also Read- Relaxations by SEBI amidst Covid-19 (Part-I)
In view of the same, SEBI provided relaxations in the SEBI (Credit Rating Agencies) Regulations, 1999. A circular has been issued wherein the Credit Rating Agencies (CRA) will look into the delay in payment of interest/principle of the loan and the reason for such delay. If the delay has occurred due to the lockdown or the procedural factors, the non-payment will not be considered as default event by the CRA and the same has to be made through appropriate disclosures.
SEBI has also provided relaxations pertaining to the issuance of Press Releases and Disclosures to be made by the CRA’s annually and semi-annually.
The above mentioned relaxations have been provided through Circular No. SEBI/ HO/ MIRSD/ CRADT/ CIR/ P/ 2020/ 53 dated 30.03.2020.
Mutual Funds & Alternative Investment Funds
2. Are there any relaxations/extensions provided with respect to Mutual Funds or Alternative Investment Funds by SEBI?
Answer: Yes, SEBI has notified in the SEBI Circular No. SEBI/HO/CFD/CMD1/CIR/P/2020/55 dated 30.03.2020 regarding the extension of the deadline for the implementation of the Stewardship Code for the Mutual Funds and all the Alternative Investment Funds.
The earlier date of the implementation of the Code was 1st April, 2020 which has now been extended to 1st July, 2020 in view of the pandemic Covid – 19.
Foreign Portfolio Investors
3. What are the extensions/relaxations provided by SEBI for the Foreign Portfolio Investors under the Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019?
Answer: As per the Operational guidelines for Foreign Portfolio Investors (FPIs) & Designated Depository Participants (DDPs) issued under Securities and Exchange Board of India (FPI) Regulations, 2019, the Foreign Portfolio Investor (FPI) Applicant has to submit the duly signed application form (including KYC details) and supporting documents and applicable fees. In case the original of any KYC document is not produced for verification, then the copies should be properly attested by entities authorized for attesting the documents.
But in view of the pandemic Covid-19, SEBI has issued a circular in order to provide temporary relaxation for the compliance requirements of the FPI’s. Now, the scanned version of the signed documents submitted by the clients to the Designated Depository Participants will be allowed in the cases where FPI’s are not in a position to send the original or the certified documents.
The above mentioned relaxations have been provided through Circular No. SEBI/ HO/IMD/DF1/ CIR/ P/ 2020/ 56 dated 30.03.2020.
Portfolio Managers
4. What are extensions and relaxations provided with respect to compliance of provisions of Portfolio Managers?
Answer: As per the Circular No. SEBI/HO/IMD/DF1/CIR/P/2020/57 dated 30.3.2020, SEBI provided relaxation pertaining to the compliance delaine of the Portfolio Managers by two months. i.e. the monthly reporting of the Portfolio Managers ending in March 2020 and April 2020.
Venture Capital funds & Investment Funds
5. Are there any extensions with respect to the Venture Capital Funds (VCFs) and Alternative Investment Funds (AIFs)?
Answer: Yes. The Securities and Exchange Board of India has relaxed the timeline of the compliance with requirements with respect to the VCFs and AIFs.
As per the Circular No. SEBI/HO/IMD/DF1/CIR/P/2020/58 dated 30.03.2020, the extension has been provided in the due date for the regulatory filings by VCFs and AIFs for the periods ending in March 2020 and April 2020 by two months.
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