Sebi Suggests Changes to Simplify Compliance for Listed (NCDs)

Sebi, the capital markets regulator, has proposed changes aimed at reducing compliance burdens for entities with listed non-convertible securities. Announced on Friday, these amendments align with the government’s FY 2023-24 Budget and are expected to lower compliance costs in the financial sector.

The consultation paper from Sebi suggests that the process for approving and authenticating financial results for entities with listed non-convertible securities should mirror that of equity-listed companies. This would ensure that financial results are approved by the board and signed by an authorized official, similar to equity-listed requirements.

Additionally, Sebi proposes aligning disclosure rules for fraud and default involving key managerial personnel in these entities with those for equity-listed companies. The regulator also suggests reducing the timeline for notifying stock exchanges of record dates from 7 to 3 working days, allowing market participants more time to react.

Sebi’s Corporate Bonds and Securitisation Advisory Committee recommends mandating that all disclosures by listed entities with non-convertible securities be submitted in the XBRL (eXtensible Business Reporting Language) format only, eliminating the need for dual submissions in XBRL and PDF formats.

The consultation paper also proposes easing restrictions on International Securities Identification Numbers (ISINs) for unlisted securities outstanding as of December 31, 2023, if they are later listed. This change would help entities with multiple ISINs transition more smoothly to a listed status.

Sebi is inviting public comments on these proposals until September 6.

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