Operational Circular for issue and listing of Non-convertible Securities, Securitised Debt Instruments, Security Receipts, Municipal Debt Securities and Commercial Paper
Summary
This section introduces the SEBI Operational Circular consolidating regulations for Non-convertible Securities and related instruments. It establishes applicability to various issuers, exchanges, and intermediaries while superseding previous circulars listed in Annex 1. The text outlines the legal basis under the SEBI Act and specific regulations, setting an effective date of August 16, 2021. This section outlines the operational procedures for investors, intermediaries, and stock exchanges in ASBA applications using UPI. It defines the specific roles of Self-Certified Syndicate Banks (SCSBs), intermediaries, and stock exchanges in processing bids and blocking funds. Additionally, it establishes the functions of NPCI and Sponsor Banks within the UPI infrastructure and details validation and formatting requirements. This section details the procedural requirements for UPI mandate acceptance, bid modifications, and fund blocking mechanisms in public issues. It outlines the specific roles and obligations of issuers, registrars, stock exchanges, intermediaries, and collecting banks during the application process. Finally, it establishes a strict timeline for post-issue closure activiti
Text
SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021 were notified pursuant to merger and repeal of the SEBI (Issue and Listing of Debt Securities) Regulations, 2008 and SEBI (Issue and Listing of Non-Convertible Redeemable Preference Shares) Regulations, 2013.
The process of merging regulations entails consolidation of related existing circulars into a single operational circular with consequent changes, superseding the circulars listed at Annex - 1.
Recognized Stock Exchanges, Depositories, other SEBI registered intermediaries, Issuers and other stakeholders are directed to comply with conditions, put in place necessary systems, make consequential changes to bye-laws, and create awareness amongst stakeholders.
This Circular is issued in exercise of powers conferred under Section 11(1) of Securities and Exchange Board of India Act, 1992; Regulation 55 of SEBI NCS Regulations, 2021; Regulation 29 of SEBI ILDM Regulations 2015; and Regulations 48 of SEBI SDI Regulations, 2008.
This circular shall come into force with effect from August 16, 2021.
Investors applying in a public issue shall use ASBA facility for making payment by either writing their bank account numbers and authorising the banks to make payment in case of allotment by signing the application forms or mentioning UPI ID in order to block the funds.
The investor may utilize the UPI mechanism to block the funds for application value up to Rs. 5 lakh per application.
An investor may submit the bid-cum-application form, with ASBA as the sole mechanism for making payment, physically at the branch of a SCSB, i.e. investor’s bank. For such applications, the SCSB shall upload the bid on the stock exchange bidding platform and block funds in the investor’s account.
An investor may submit the completed bid-cum-application form to intermediaries mentioned above along with details of his/ her bank account for blocking of funds. The intermediary shall upload the bid on the stock exchange bidding platform and forward the application form to a branch of a SCSB for blocking of funds.
An investor may submit the bid-cum-application form with a SCSB or the intermediaries mentioned above and use his/ her bank account linked UPI ID for the purpose of blocking of funds, if the application value is Rs. 5 lakh or less. The intermediary shall upload the bid on the stock exchange bidding platform. The application amount would be blocked through the UPI mechanism in this case.
An investor may submit the bid-cum-application form through the App or web interface developed by stock exchanges wherein the bid is automatically uploaded onto the stock exchange bidding platform and the amount is blocked using the UPI mechanism.
The SCSBs or the above-mentioned intermediaries shall, at the time of receipt of the application, provide an acknowledgement to the investor, by giving the counter foil or specifying the application number to the investor, as proof of having accepted the application form, in physical or electronic mode, respectively.
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Source: SecMarx — Operational Circular for issue and listing of Non-convertible Securities, Securitised Debt Instruments, Security Receipts, Municipal Debt Securities and Commercial Paper. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.