First time levy of fines for violations of Listed Debt Securities under Listing Regulations 2015

The Securities and Exchange Board of India, vide circular dated November 13, 2020, has introduced a fine and penalty structure for non-compliances with continuous disclosure requirements by issuers of debt instruments.On January 22, 2020, SEBI issued a uniform structure for imposing fines for non-compliant issuers of listed equity shares. Keeping in view the same, the Capital Market Regulator, in consultation with various market participants, issued the instant circular to ensure effective enforcement of continuous disclosure obligations by issuers of listed debt securities. This circular will be applicable on the following listed instruments:
  • Non-Convertible Debt Securities (NCDs);
  • Non-Convertible Redeemable Preference Shares (NCRPS); and
  • Commercial Papers (CPs)
Effective Date: The fine structure prescribed in this circular will be effective from compliance periods ending on or after December 31, 2020.
The fine structures, as per the above mentioned SEBI circular are as follows:Part A – Fine to be levied in case of non-compliances by issuers of listed NCDs and/or NCRPS:
S. No. Regulation Non-compliance Fine payable and/or other action to be taken for non-compliance
(a) Reg. 50(1)/(3) Delay   in   furnishing prior   intimation   with respect to date of payment of interest/ redemption amount or intimation regarding board meeting effecting the rights or interest of holders of NCDs/NCRPS. Rs. 1000 per ISIN
(b) Reg. 52(1) Non-submission of the financial results within the period prescribed under this Reg. Rs. 5000 per day*
(c) Reg. 52(4)/ 52(6) Non-disclosure of line items prescribed under Regulation 52(4) along with the half yearly/ annual financial results or non-disclosure of items pertaining to NCRPS as notes to financials prescribed under Regulation 52(6). Rs. 1000 per day
(d) Reg. 52(5) Non-submission of a Certificate signed by the Debenture Trustee taking note of the contents prescribed under regulation 52(4). Rs. 1000 per day

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