Allows companies to file shelf prospectus for the issuance of non-convertible debt securities
Stock market regulator Securities & Exchange Board of India (Sebi) on Tuesday, 24 December 2013, said it has allowed non-banking finance companies (NBFCs) registered with the Reserve Bank of India (RBI), housing finance companies registered with the National Housing Bank (NHB) and entities which have listed their shares/debentures in the stock exchanges for at least three years to issue shelf prospectus for public issuance of non-convertible debt securities. All such entities must have minimum net worth of Rs 500 crore, track record of three years of distributable profits, a minimum credit rating of "AA-", and having no default history or regulatory action pending with RBI, Sebi or NHB, Sebi said.
Public financial institutions, scheduled commercial banks, issuers authorized by the notification of CBDT to make public issue of tax free secured bonds and Infrastructure Debt Funds classified as non-banking financial companies, or NBFCs, can also file shelf prospectus for public issuance of non-convertible debt securities.
The Sebi board on Tuesday, 24 December 2013, also approved the SEBI (Procedure for Search and Seizure) Regulations, 2013, made on the lines of the provisions in the Income Tax Act, 1961 and for providing the detailed procedures for search and seizures by Sebi. The Securities Laws (Amendment) Second Ordinance, 2013, inter alia, confers direct powers on Chairman, Sebi to authorize the Investigating Authority or any other officer of Sebi to search any premises where incriminating documents are lying and seize such documents for the purpose of investigation. The Ordinance also empowers Sebi to make regulations for executing the search operations and to ensure safe custody of any books of account or other documents that are seized.
The Sebi board also approved a proposal to amend the Securities and Exchange Board of India (Collective Investment Schemes) Regulations, 1999, providing a framework for regulation of deemed Collective Investment Schemes and additional requirements for continuous compliance by a registered Collective Investment Scheme. The Securities Laws (Amendment) Ordinance, 2013 provides for regulation of pooling of funds under any scheme or arrangement, involving a corpus amount of Rs 100 crore or more, to be deemed to be a Collective Investment Scheme, subject to sub-section (3) of section 11AA of the SEBI Act.
The Sebi has scrapped mandatory grading of initial public offers (IPOs). Considering the requests received from market participants, viz. investor associations and Association of Investment Bankers of India (AIBI), the recommendation of the advisory committee of Sebi, and to align with the principles laid down by Financial Stability Board (FSB) on reducing the reliance on credit rating agencies, the Sebi board approved the proposal to make the IPO grading mechanism "voluntary" as against the current provision of the same being "mandatory", Sebi said in statement.
Sebi also conveyed a decision of the department of economic affairs, under the ministry of finance, stating that all categories of foreign portfolio investors would get similar tax treatment as given to foreign institutional investors now.
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