CAIRR Update October 14, 2020

October 14, 2020

Summary of the Circular Issued by SEBI

SEBI issues circular for standardisation of procedure to be followed by Debenture Trustee(s) in case of ‘Default’ by Issuers of listed debt securities

After consultation with stakeholders involved, SEBI vide its circular dated October 13, 2020 has decided to standardize the procedure to be followed by Debenture Trustee(s) in case of ‘Default’ by Issuers of listed debt securities.

The key highlights of the circular are:

• In case of presence of multiple ISIN’s which may have been issued under the same Information Memorandum(s) (“IM(s)”) or a single ISIN which may have been split across multiple IM(s) – Event of default shall be reckoned at ISIN Level.
• Process to be followed in case of execution of Inter Creditor Agreement (“ICA”) as per the terms stipulated in the RBI’s Prudential Framework for Resolution of Stressed Assets.
• Broad Conditions for signing of ICA by Debenture Trustees on behalf of investors

This clarification is integrated in our free to use website www.ca2013.com for your easy reference.

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