Review of provisions pertaining to Electronic Book Provider platform
Summary
This circular revises Chapter VI of the Operational Circular to modify the Electronic Book Provider (EBP) platform framework for issuing non-convertible securities. The changes aim to address market concerns such as 'fastest finger first' allotment and introduce anchor investor options while updating eligibility and procedural rules. These revised provisions are mandated to come into effect from January 1, 2023. This section outlines the enrollment, KYC verification, and operational requirements for participants on the Electronic Bidding Platform. It details the bidding process mechanics, including timing, announcement protocols, bid modification rules, and disclosure formats. Additionally, it specifies allotment procedures based on pricing priorities and regulations regarding anchor investor allocations. This section details the pay-in obligations for securities allotment, including escrow mechanisms and penalties for default. It outlines the issuer's right to withdraw an offer under specific conditions and defines the responsibilities of issuers, RTAs, and EBPs. Finally, it mandates CISA audits for EBP platforms and directs compliance with new operational standards.
Text
The provisions of this circular shall come into effect from January 1, 2023.
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 of the SEBI (Issue and Listing of Non-convertible Securities) Regulations, 2021 and Regulation 29 of SEBI (Issue and Listing of Municipal Debt Securities) Regulations, 2015.
Primary issuances through EBP platform shall comply with the stipulations provided in this chapter.
QIBs as defined under Regulation 2 (ss) of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018 are eligible participants on the EBP Platform.
Any non-QIB, who/ which has been authorized by the issuer, to participate in a particular issue on the EBP Platform.
A private placement of debt securities and NCRPS... if it is: a single issue... of Rs. 50 crore or more; a shelf issue... cumulatively amounts to Rs. 50 crore or more...; or a subsequent issue... equals or exceeds Rs. 50 crore.
Issues of debt securities and NCRPS on private placement basis, irrespective of issue size, by issuers who are in existence for less than three years...
The issuance of PDIs, PNCPS, PCPS, RNCPS, and instruments of similar nature... issued as per RBI stipulations and listed under Chapter V of the SEBI NCS Regulations, 2021, irrespective of the issue size.
An issuer, if desirous, may choose to access EBP platform for private placement of municipal debt securities or CPs or CDs also.
Issuers of debt securities and NCRPS on private placement basis of issue size less than Rs. 50 crore may also choose to access the EBP platform for such issuances.
The issuer shall ensure compliance with all requisite laws, rules, regulations, etc. with respect to private placement of securities including ensuring compliance with Section 42 of the Companies Act, 2013.
the issuer, shall include the number of non-QIB eligible participants, on whose behalf arranger(s) is making bids in a particular issue, for the purposes of compliance with the provisions of Section 42 of the Companies Act, 2013 and other relevant statutes.
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Source: SecMarx — Review of provisions pertaining to Electronic Book Provider platform. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.