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Corporate Laws Central Ministry of Finance Securities and Exchange Board of India Act, 1992

Amendment to Para 15 of Master Circular for Credit Rating Agencies (CRAs) dated May 16, 2024 ("Master Circular")

18-Nov-2024 | SEBI/HO/DDHS/DDHS-PoD-3/P/CIR/2024/160

SEBI has issued a circular regarding Amendment to Para 15 of Master Circular for Credit Rating Agencies (CRAs) dated May 16, 2024 ("Master Circular"), effective from 18th November 2024.

Key highlights-
1. In the scenarios where non-payment of debt (principal and / or interest) may arise due to reasons beyond the control of the issuer, namely, failure to remit payment due to absence of correct information or due to incorrect or dormant investor account furnished by the investor(s) or due to notice / instruction received from a government authority to freeze the account of investor(s), the CRAs shall confirm and verify the availability adequate funds with the issuer and also confirm and verify the following-
i) the proof of failure of the required payment of debt (principal and / or interest)
ii) the reasons for failure being as specified above
iii) the required amounts being duly paid into a separate escrow account maintained with a scheduled commercial bank by the issuer on the due date of payment.
2. For all the above instances, CRAs are required to furnish the details as mentioned in the table under Para 6 of the circular to the Stock Exchanges, Depositories and Debenture Trustee on the same day as the dissemination of the rating Press Release on the CRA?s website.
3. The term "technical default" is removed from Para 15.3 of the Master Circular.

Kindly refer to the attached circular, for more information.

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