(1) In these Regulations, unless the context otherwise requires,
(a) “Act” means the Securities and Exchange Board of India Act, 1992 (15 of 1992);
(b) advertisement” includes notices, brochures, pamphlets, circulars, show cards, catalogues, hoardings, placards, posters, insertions in newspaper, pictures, films, cover pages of offer documents or any other print medium, radio, television programmes through any electronic medium;
(c) “Board” means the Securities and Exchange Board of India established under provisions of Section 3 of Act;
(d) “book building” means a process undertaken prior to filing of prospectus with the Registrar of Companies by means of circulation of a notice, circular, advertisement or other document by which the demand for the debt securities proposed to be issued by an issuer is elicited and the price and quantity of such securities is assessed;
1[(e) “debt securities” means non-convertible debt securities which create or acknowledge indebtedness and includes debentures, bonds and such other securities of a body corporate or a Trust registered with the Board as a Real Estate Investment Trust or an Infrastructure Investment Trust, or any statutory body constituted by virtue of a legislation, whether constituting a charge on the assets of the body corporate or not, but excludes bonds issued by Government or such other bodies as may be specified by the Board, security receipts and securitized debt instruments;]
(f) “designated stock exchange” means a stock exchange in which securities of the issuer are listed or proposed to be listed and which is chosen by the issuer for the purposes of a particular issue under these regulations;
(g) "issuer” means any company, public sector undertaking or statutory corporation which makes or proposes to make an issue of debt securities in accordance with these regulations or which has its securities listed on a recognized stock exchange or which seeks to list its debt securities on a recognized stock exchange 2[and includes a Trust registered with the Board as a Real Estate Investment Trust or an Infrastructure Investment Trust and whose units are listed in recognized stock exchange(s)];
3[(ga) "net worth" shall have the same meaning as assigned to it in clause (57) of section 2 of the Companies Act, 2013;]
(h) “private placement” means an offer or invitation to less than fifty persons to subscribe to the debt securities in terms of sub-section (3) of section 67 of the Companies Act, 1956 (1 of 1956);
(i) “public issue” means an offer or invitation by an issuer to public to subscribe to the debt securities which is not in the nature of a private placement;
1 Substituted by the SEBI (Issue and Listing of Debt Securities) (Second Amendment) Regulations, 2017, w.e.f.
15.12.2017. Prior to the substitution, the clause read as follows:
“(e) “debt securities” means a non-convertible debt securities which create or acknowledge indebtedness, and include debenture, bonds and such other securities of a body corporate or any statutory body constituted by virtue of a legislation, whether constituting a charge on the assets of the body corporate or not, but excludes bonds issued by Government or such other bodies as may be specified by the Board , security receipts and securitized debt instruments;” 2 Inserted ibid.
3 Inserted by the SEBI(Issue and Listing of Debt Securities)(Amendment)Regulations, 2014 w.e.f. 31-01-14.
(j) “offer document” means 4[a prospectus or a shelf prospectus] and includes any such document or advertisement whereby the subscription to debt securities are invited by the issuer from public;
(k) “recognised stock exchange” means any stock exchange which is recognised under section 4 of the Securities Contracts (Regulation) Act, 1956;
(l) “schedule" means a schedule annexed to these regulations;
5[(la) “shelf prospectus" shall have the same meaning as assigned to it in section 31 of the Companies Act, 2013;]
(m) “specified” means specified by a general or special order or circular issued under the Act or these regulations6[;]
7[(n) “wilful defaulter” means an issuer who is categorized as a wilful defaulter by any bank or financial institution or consortium thereof, in accordance with the guidelines on wilful defaulters issued by the Reserve Bank of India and includes an issuer whose director or promoter is categorized as such.]
(2) All other words and expressions used but not defined in these regulations, shall have the same meanings respectively assigned to them in the Act or the Companies Act, 1956 or Securities Contracts (Regulation) Act, 1956 or the Depositories Act, 1996 or the Rules and the Regulations made thereunder or any statutory modification or reenactment thereto, unless the context requires otherwise.
Applicability
3. These regulations shall apply to-
(a) public issue of debt securities; and
(b) listing of debt securities issued through public issue or on private placement basis on a recognized stock exchange.
CHAPTER II 4 Substituted for "prospectus" by the SEBI(Issue and Listing of Debt Securities)(Amendment)Regulations, 2014 w.e.f.
31-01-14.
5 Inserted by the SEBI(Issue and Listing of Debt Securities)(Amendment)Regulations, 2014 w.e.f. 31-01-14.
6Substituted for "." by the SEBI (Issue and Listing of Debt Securities)(Amendment) Regulations, 2016 w.e.f. 25-05-
16.
7 Inserted by the SEBI (Issue and Listing of Debt Securities) (Amendment) Regulations, 2016 w.e.f. 25-05-16.
ISSUE REQUIREMENTS FOR PUBLIC ISSUES General Conditions
4. 8[(1) No issuer shall make any public issue of debt securities if as on the date of filing of draft offer document or final offer document as provided in these regulations:
(a) the issuer or the person in control of the issuer or its promoter or its director is restrained or prohibited or debarred by the Board from accessing the securities market or dealing in securities; or
(b) the issuer or any of its promoters or directors is a wilful defaulter or it is in default of payment of interest or repayment of principal amount in respect of debt securities issued by it to the public, if any, for a period of more than six months.]
(2) No issuer shall make a public issue of debt securities unless following conditions are satisfied, as on the date of filing of draft offer document and final offer document as provided in these regulations,
(a) it has made an application to one or more recognized stock exchanges for listing of such securities therein:
Provided that where the application is made to more than one recognized stock exchanges, the issuer shall choose one of them as the designated stock exchange:
Provided further that where any of such stock exchanges have nationwide trading terminals, theissuer shall choose one of them as the designated stock exchange;
Explanation: For any subsequent public issue, the issuer may choose a different stock exchange as a designated stock exchange subject to the requirements of this regulation;
(b) it has obtained in-principle approval for listing of its debt securities on the recognized stock exchanges where the application for listing has been made;
(c) credit rating has been obtained from at least one credit rating agency registered with the Board and is disclosed in the offer document:
Provided that where credit ratings are obtained from more than one credit rating agencies, all the ratings, including the unaccepted ratings, shall be disclosed in the offer document;
8Substituted for sub-regulation (1) by the SEBI (Issue and Listing of Debt Securities) (Amendment) Regulations, 2016 w.e.f. 25-05-16. Prior to substitution, sub-regulation (1) read as under:
“(1) No issuer shall make any public issue of debt securities if as on the date of filing of draft offer document and final offer document as provided in these regulations, the issuer or the person in control of the issuer, or its promoter, has been restrained or prohibited or debarred by the Board from accessing the securities market or dealing in securities and such direction or order is in force.”
(d) it has entered into an arrangement with a depository registered with the Board for dematerialization of the debt securities that are proposed to be issued to the public, in accordance with the Depositories Act,1996 and regulations made thereunder.
(3) The issuer shall appoint one or more merchant bankers registered with the Board at least one of whom shall be a lead merchant banker.
(4) The issuer shall appoint one or more debenture trustees in accordance with the provisions of Section 117B of the Companies Act, 1956 (1 of 1956) and Securities and Exchange Board of India (Debenture Trustees) Regulations, 1993.
(5) The issuer shall not issue debt securities for providing loan to or acquisition of shares of any person who is part of the same group or who is under the same management.
(6) Explanation: For the purposes of sub-regulation (5), -
(a) two persons shall be deemed to be “part of the same group” if they belong to the same group within the meaning of clause (ef) of section 2 of the Monopolies and Restrictive Trade Practices Act, 1969 (54 of 1969) or if they own “inter-connected undertakings” within the meaning of clause (g) of section 2 of that Act;
(b) the expression “under the same management” shall have the meaning derived from subsection (1B) of section 370 of the Companies Act, 1956 (1 of 1956).
Disclosures in the offer document