Master Circular for ESG Rating Providers
Summary
This document serves as the Master Circular for ESG Rating Providers, consolidating existing regulations under the SEBI (Credit Rating Agencies) Regulations, 1999. It establishes procedural and disclosure requirements for ERPs while directing them to maintain necessary systems for compliance. The circular comes into immediate effect and outlines monitoring mechanisms through yearly internal audits. This section establishes the SEBI Intermediary Portal as the primary channel for ESG Rating Provider registration and related applications. It mandates prior SEBI approval for any change in control of an ERP, detailing specific submission requirements and validity periods. Additionally, it clarifies that transferring business activities to another legal entity requires fresh registration from SEBI. This section mandates the surrender of registration certificates when a transferor ceases to exist or transfers its business. It establishes detailed guidelines for the orderly migration of ESG ratings during suspension, cancellation, or voluntary surrender of an ERP's registration. The text further defines ESG rating products and clarifies requirements for offering core versus non-core rating
Text
ESG Rating Providers are regulated under the provisions of Securities and Exchange Board of India (Credit Rating Agencies) Regulations, 1999 that inter-alia prescribe guidelines for registration of ERPs, general obligations of ERPs, manner of inspection and code of conduct applicable to ERPs.
While the broad framework for ERPs has been laid down in the CRA Regulations, the procedural/ disclosure requirements and obligations are being specified through this Master Circular, which will enable the industry and other users to have access to all the applicable directions to ERPs at one place.
ERPs are directed to comply with the conditions laid down in this master circular. Also, ERPs shall have necessary systems and infrastructure in place for implementation of this circular. The Board of Directors of the ERP shall be responsible for ensuring compliance with these provisions.
This Master Circular is a compilation of the existing circulars as on date, with consequent changes. Accordingly, the list of existing circulars for ERPs which have been superseded by this Master Circular is placed at Appendix.
anything done or any action taken or purported to have been done or taken under the rescinded circulars, prior to such rescission, shall be deemed to have been done or taken under the corresponding provisions of this Master Circular;
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 this Master Circular;
the previous operation of the rescinded circulars or anything duly done or suffered thereunder, any right, privilege, obligation or liability acquired, accrued or incurred under the rescinded circulars, any penalty, incurred in respect of any violation committed against the rescinded circulars, or any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty as aforesaid, shall remain unaffected as if the rescinded circulars have never been rescinded.
This circular is issued in exercise of the powers conferred by Section 11 (1) of Securities and Exchange Board of India Act, 1992 read with the provisions of Regulation 28H of CRA Regulations, to protect the interest of investors in securities, to promote the development of, and to regulate, the securities market.
The provisions of the Master Circular shall come into force with immediate effect from the date of notification of this Master Circular. For the purpose of this Circular, “listed entity” shall have the same meaning as provided in Regulation 2(1)(p) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Monitoring of provisions of this circular shall be done in terms of the yearly internal audit for ERPs, mandated under Regulation 28S of the CRA Regulations and this master circular issued thereunder.
SEBI has operationalized SEBI Intermediary Portal (https://siportal.sebi.gov.in) for the intermediaries to submit all the registration applications online.
All applications for registration/ surrender/other requests will be made through SEBI Intermediary Portal.
You have read the preview. Create a free account to read the full document and see every order that applied it.
Free accounts include 10 searches/day with full text access.
Source: SecMarx — Master Circular for ESG Rating Providers. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.