Format of Due Diligence Certificate to be given by the DTs

Format of Due Diligence Certificate to be given by the DTs

1. SEBI vide notification dated July 10, 2024, amended the SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021 (‘NCS Regulations’) inter-alia specifying the format of Due diligence certificate to be submitted by the DTs in case of secured and unsecured debt securities.
   
2. While Chapter II of Master Circular for DTs specifies the format for due diligence certificate in case of secured debt securities (which is in line with that specified under NCS Regulations), it does not specify the same in case of unsecured debt securities.
   
3. In line with the format specified under NCS Regulations, the following is specified in case of unsecured debt securities:
   3.1. At the time of filing the draft offer document with the stock exchanges, Issuer shall submit to the Stock Exchange, a due diligence certificate obtained from the Debenture Trustee as per the format specified inAnnex-A.
   3.2. At the time of filing of listing application, Issuer shall submit to the Stock Exchange, a due diligence certificate obtained from the Debenture Trustee as per the format specified in Annex-B.
   
4. Further, pursuant to the amendment, the following paras of Chapter II of Master Circular for DTs are modified as under:
   
   4.1. Para 2.3.1. (a) shall read as under:
   “The Debenture Trustee may furnish……..prescribed under regulations 40.1.(a) and 44.(3).(a) of the SEBI NCS Regulations…….”
   
   4.2. Para 2.3.1.(b) shall read as under:
   “At the time of the issuance of the …………. prescribed under regulations 40.1.(a) and 44.(3).(a) of the SEBI NCS Regulations…….”
   
5. This circular shall be applicable with immediate effect.
   
6. This circular is issued with the approval of competent authority, in exercise of the powers conferred by Section 11 (1) of 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, Regulation 55 of NCS Regulations, Regulation 29 of SEBI (Issue and Listing of Municipal Debt Securities) Regulations, 2015 and Regulation 101(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015to protect the interest of investors in securities and to promote the development of, and to regulate, the securities market.
   
7. This Circular is available on the website of the Securities and Exchange Board of India at www.sebi.gov.in under the category “Legal” and under the drop down “Circulars”.

Circular

Go To SEBI

Read More on SEBI