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Streamlining the process of public issuance of debt securities

Streamlining the process of public issuance of debt securities

In order to make the existing process of issuance of debt securities (non-convertible preference shares and securitised debt Instruments) easier, simpler and cost effective for both issuers and investors, SEBI has decided to reduce the time taken for listing of such securities to 6 working days from 12 working days. Accordingly, SEBI has specified some aspects related to the process of public issuance of debt securities.

Some of these are discussed below:

1. Submission of application form

• All the investors applying in a public issue shall use only Application Supported by Blocked Amount (ASBA) facility for making payment.
• An investor, intending to subscribe to a public issue, shall submit a completed bid-cum-application form to the respective Self-Certified Syndicate Banks (SCSBs) or any of the intermediaries such as a stock broker, depository participants etc.

2. Role of SCSBs and intermediaries

• The SCSBs or the intermediaries shall, at the time of receipt of application, give an acknowledgement to investor.
• After accepting the form from investors, SCSB/Intermediaries shall upload details in the electronic bidding system.
• The SCSB may begin blocking of funds available in the bank account to the extent of the application money specified.

3. Role of Stock Exchanges

• Stock exchange shall validate the electronic bid details with depository records by end of each bidding day and bring the inconsistencies to the notice of SCSBs or the relevant intermediaries.

The above process shall be effective from on or after October 01, 2018.

For more details, please check out the SEBI Circular attached.

This alert may be relevant for the individuals with the following NISM Certifications:
• NISM Series II A: Registrars and Transfer Agents (Corporate) Certification Examination
• NISM Series II B: Registrars and Transfer Agents (Mutual Fund) Certification Examination
• NISM Series-III-A: Securities Intermediaries Compliance (Non-Fund) Certification Examination
• NISM Series VI: Depository Operations Certification Examination
• NISM Series-IX: Merchant Banking Certification Examination

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