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July 21, 2021

SEBI relaxes regulatory requirements by Debenture Trustees

by CA Shivam Jaiswal in SEBI

SEBI relaxes regulatory requirements by Debenture Trustees

Securities and Exchange Board of India

CIRCULAR

SEBI/HO/MIRSD/CRADT/CIR/P/2021/597

July 20, 2021

To,
All Debenture Trustees registered with SEBI
All Recognized Stock Exchanges

Dear Sir/ Madam,

Sub: Relaxation in timelines for compliance with regulatory requirements by Debenture Trustees due to Covid-19

1. In view of the situation arising due to Covid-19 pandemic, challenges arising out of the local restrictions placed by various state governments and representations received from the Debenture Trustees, SEBI had earlier provided relaxations in timelines for compliance with certain regulatory provisions of SEBI Circular No. SEBI/HO/MIRSD/CRADT/CIR/ P/2020/230 dated November 12, 2020 vide Circular no. SEBI/HO/MIRSD/CRADT/CIR/P/2021/561 dated May 03, 2021.

2. Further representations have been received from the Debenture Trustees wherein they have expressed the challenges faced in complying with the requirements within the applicable timelines due to the difficulty in information sharing, limited functioning of the various offices and travelling restrictions and imposition of lock down in most states due to Covid-19.

3. In view of the prevailing situation due to Covid-19 pandemic and representations received from the Debenture Trustees, it has been decided to extend the timelines for compliance with the following regulatory requirements of the SEBI circular dated November 12, 2020 for the quarter/ half year/ year ending March 31, 2021, as under:

S.No.Regulatory requirements of SEBI circular dated November 12, 2020 Current timelineExtended timeline
1Submission of reports/ certifications to Stock Exchanges as per clause 2.1 of the circular July 15, 2021 
a.Asset Cover Certificate  August 31, 2021
b.A statement of value of pledged securities  August 31, 2021
c.A statement of value for Debt Service Reserve Account (DSRA) or any other form of security offered  August 31, 2021
d.Net worth certificate of guarantor (secured by way of personal guarantee)  October 31,
2021
e.Financials/ value of guarantor prepared on basis of audited financial statement etc. of the guarantor (secured by way of corporate guarantee)  October 31,
2021
f.Valuation report and title search report for the immovable/ movable assets, as applicable.  October 31,
2021
 Following disclosures on the website as per clause 4 of circular: i. Monitoring of asset cover certificate and quarterly compliance report of the listed entity. ii. Monitoring of utilization certificate iii. Status of information regarding breach of covenants/ terms of the issue, if any action taken by debenture trustee iv. Status regarding maintenance of accounts maintained under supervision of debenture trusteeJuly 15, 2021August 31, 2021 

4. This circular is issued in exercise of the powers conferred upon SEBI under Section 11 (1) of the Securities and Exchange Board of India Act, 1992 read with the provisions of Regulation 2A of the Securities and Exchange Board of India (Debenture Trustees) Regulations, 1993 to protect the interest of investors in securities and to promote the development of, and to regulate, the securities market.

Yours faithfully,

Aradhana Verma
Deputy General Manager
Market intermediaries Regulation & Supervision Department
Email id: aradhanad@sebi.gov.in
Phone: +91-22-26449633

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