Sebi proposes new norms for green bonds for renewable energy ventures

Mumbai, Nov. 30: Market regulator Sebi today announced a new set of norms for the listing of stock exchanges, trading of green bonds and giving an exit route to the dissenting shareholders of listed companies.

"The board has considered the proposal for listing of stock exchanges with safeguards and procedures in compliance with the ownership and governance norms as per the SECC Regulations", the regulator said in a statement after its board meeting here.

This will come as a big relief to the bourses that were of the view that it was practically hard for them to ensure that each and every bidder during an initial public offer (IPO) was a fit entity to buy the shares. On Monday, the capital markets regulator Sebi, finally gave a green signal approving the revised IPO norms to list bourses - a proposal opposed by the Bimal Jalan Committee in 2010.

The shareholding threshold of 2 per cent, 5 per cent or 15 per cent (for different classes of investors) as the case may be, will be monitored through Depository mechanism.

The Securities and Exchange Board of India (Sebi) has paved the way for listing of BSE and the National Stock Exchange (NSE) by clarifying on some of the regulatory requirements that were believed to be acting as a hindrance. However, the lack of a formal process for stock exchange listing had made the task hard.

The move would help the shareholders make an exit if they feel dissatisfied with any change in business plan of the concerned company after raising funds through IPOs, FPOs or any other capital-raising exercise. Sebi also intends to prescribe steps to ensure that only "fit and proper" shareholders stay even after listing of stock exchanges. BSE will try to expedite the listing process based on the regulations. He said that Finance Ministry, RBI and Sebi were working together with positive interaction and understanding and will continue to work for reforms and stability.

To help generate low-priced funds for renewable energy ventures, Sebi proposed new norms for the issue and listing of green bonds.

Sebi will also initiate a discussion on bringing the private placed debt offering on the exchange platform. It will help in improving "efficiency and transparency of the price discovery mechanism vis-a-vis the extant over-the-telephone market coupled with possible reduction of cost and time taken for such issuance".

It is proposed that such an electronic book may be created by entities to be named as Electronic Book Providers (EBPs) and players like stock exchanges, depositories and merchant bankers with net worth above Rs. 100 crore may apply to SEBI for setting up EBPs.

The Sebi decision comes after the last board meeting of the year, in which the regulator also approved starting a public consultation for rules governing issuance of green bonds.

Separately, the Sebi board also said stock exchanges need no longer transfer 25% of their profits to the SGF (settlement guarantee fund) of the clearing corporation, considering sufficient availability of SGF resources.