Publishing Investor Charter and Disclosure of Complaints by Merchant Bankers on their Websites – Debt Market
Summary
SEBI mandates all registered Merchant Bankers to publish an Investor Charter and disclose complaint data on their websites for debt market activities. The Investor Charter outlines specific services, timelines, and investor rights for public issues of debt securities and non-convertible redeemable preference shares. These disclosure requirements are effective from January 1, 2022, and supplement existing grievance handling regulations. This section outlines investor rights regarding withdrawal, compensation for delays, and digital bidding methods. It provides detailed instructions on application procedures, including ASBA and UPI mechanisms, alongside specific prohibitions to ensure compliance. The text further establishes grievance redressal timelines, nature of complaints, and the merchant banker's service obligations under an Investor Charter. This section outlines the post-issue timelines for information availability, allotment, and unblocking of ASBA accounts in public issues. It details investor rights, dos and don'ts, and the grievance redressal mechanism including specific timelines for resolution. The document further establishes an Investor Charter for private placements,
Text
All registered Merchant Bankers are hereby advised to disclose on their websites, the Investor Charter for each of the below mentioned categories... Public issue of debt securities; Public issue of non-convertible redeemable preference shares; and Private placement of debt securities and non-convertible redeemable preference shares.
all registered Merchant Bankers shall also disclose on their respective websites, data on complaints received against them or against issues dealt by them and redressal status thereof, latest by the seventh day of the succeeding month, as per the format enclosed at Annex - B to this circular.
The provisions of this circular shall come into effect from January 01, 2022.
The Circular is issued in exercise of the powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992 read with Regulation 55 (1) of the SEBI (Issue and Listing of Non-convertible Securities) Regulations, 2021 to protect the interest of investors in securities and to promote the development of, and to regulate the securities market.
Upload Draft Offer Document on stock exchange/ lead manager/ SEBI/ Issuer’s website. Invite public comments within seven working days therefrom.
Issuer to publish a statutory advertisement, on or before the issue opening date in accordance with SEBI (Issue and Listing of Non-convertible Securities) Regulations, 2021 (NCS Regulations).
Listing and the commencement of trading on the stock exchanges shall be within six working days of the offer closing date or such other time as may be prescribed by SEBI.
Disclose on lead managers’ websites - Track record of the performance of the public issues managed by it, for a period of three financial years from the date of listing for each public issue.
Debenture trustees to ensure independent assessment and diligence for the security offered for the proposed issue and also ensure dissemination of information as per the NCS Regulations.
Issuer to promptly inform the stock exchange(s) all information bearing on its performance/ operation, price sensitive information or any action that shall affect payment of interest/ coupon or redemption of the debt securities.
In case of delay the issuer shall pay interest at the rate of 15% per annum (Reg. 35(2) of NCS Regulations).
Investor can withdraw his/ her application prior to the issue closing date. Post issue closure, the same can be done by submitting a withdrawal request to the Registrar to the Issue prior to the finalization of the basis of allotment.
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Source: SecMarx — Publishing Investor Charter and Disclosure of Complaints by Merchant Bankers on their Websites – Debt Market. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.