Date: 2022-11-24Category: Not ApplicableState: Union GovernmentCountry: India
Reporting of trades in Non-convertible Securities – Chapter XVI of Operational Circular issued under SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021
**Summary:**
SEBI Circular SEBI/HOD/DDHS/Div1/PCIR/2022/159, dated November 24, 2022, addresses the reporting of trades in listed Nonconvertible Securities under the SEBI Issue and Listing of Nonconvertible Securities Regulations, 2021. The circular aims to rectify incomplete or inaccurate information on Over-the-Counter (OTC) trades in listed Nonconvertible Securities reported to Stock Exchanges, which leads to incorrect data being displayed on Stock Exchange websites. Effective January 1, 2023, all persons dealing in nonconvertible securities, irrespective of their status as SEBI-registered intermediaries, must report OTC trades in a uniform format as specified in the circular. Paragraph 1.3 of Chapter XVI of the Operational Circular No. SEBI/HOD/DDHS/CIR/2021/613 dated August 10, 2021, stands replaced by this circular's stipulations. Stock Exchanges are directed to monitor compliance with Chapter XVI and report any discrepancies in OTC trade reporting by investors to SEBI. The circular is issued under Section 11(1) of the Securities and Exchange Board of India Act, 1992, and Regulation 55(1) of the SEBI Issue and Listing of Nonconvertible Securities Regulations, 2021. The complete circular is available on the SEBI website (www.sebi.gov.in) under the Legal/Circulars section. For further information, contact Pradeep Ramakrishnan, General Manager, Department of Debt and Hybrid Securities, at 91 22 26449246 or pradeepr@sebi.gov.in.
Key Entities Referenced
Securities and Exchange Board of India (SEBI): The regulatory body for securities markets in India, responsible for protecting investor interests and regulating the securities market.
SEBI Issue and Listing of NonConvertible Securities Regulations, 2021: A set of regulations established by SEBI governing the issuance and listing of nonconvertible securities.
Nonconvertible Securities: A type of debt instrument that cannot be converted into equity shares.
Operational Circular No. SEBIHODDHSPCIR2021613: An operational circular issued by SEBI providing guidelines and requirements related to the issuance and listing of Nonconvertible Securities.
OTC trades: Over-the-counter trades, referring to securities transactions not conducted on a formal exchange.
Stock Exchanges: Formal exchanges where securities are bought and sold.
Securities and Exchange Board of India Act, 1992: The act of parliament that established the Securities and Exchange Board of India (SEBI).
Pradeep Ramakrishnan: General Manager, Department of Debt and Hybrid Securities at SEBI.
CIRCULAR
SEBI/HO/DDHS/DDHS_Div1/P/CIR/2022/159 November 24, 2022
To,
Entities buying, selling, trading or otherwise dealing in listed Non-convertible
Securities
Madam/ Sir,
Sub: Reporting of trades in non-convertible securities under SEBI (Issue and Listing of
Non-Convertible Securities) Regulations, 2021
1. SEBI, vide Operational Circular No. SEBI/HO/DDHS/P/CIR/2021/613 dated August 10,
2021 (as amended from time to time), has prescribed the requirements pertaining to
operational and other aspects relating to the issue and listing of Non-convertible
Securities. In the said Operational Circular, Chapter XVI on ‘Reporting of Trades’, inter
alia, contains provisions relating to reporting, clearing and settlement of OTC trades by all
person(s) dealing in non-convertible securities.
2. It is observed that information on OTC trades in listed Non-convertible Securities provided
to the Stock Exchange(s) by the investors is incomplete and/ or inaccurate. This, in turn,
amounts to incorrect and distorted information being displayed on the Stock Exchanges’
websites. In order to address the issue, it has been decided all OTC trades shall be
reported in a uniform format specified in (3) below.
3. Consequently, paragraph 1.3 of Chapter XVI, titled, “Reporting of Trades”, of the
Operational Circular shall be replaced as follows:
“1.3. The reporting of OTC trades in non-convertible securities shall be made by all
person(s) dealing in such securities irrespective of whether they are SEBI registered
intermediaries or otherwise, as per below mentioned format:
4. Stock Exchanges shall monitor the compliance of this circular / chapter XVI of the
Operational circular and bring to the notice of SEBI, periodically, discrepancies in
reporting of OTC trades by investors.
5. The provisions of this circular shall come into force from January 01, 2023.6. The Circular is issued in exercise of the powers conferred under Section 11(1) of the
Securities and Exchange Board of India Act, 1992, read with Regulation 55 (1) of the
SEBI (Issue and Listing of Non-convertible Securities) Regulations, 2021 to protect the
interest of investors in securities and to promote the development of, and to regulate
the securities market.
7. This Circular is available at www.sebi.gov.in under the link “LegalCirculars”.
Yours faithfully,
Pradeep Ramakrishnan
General Manager
Department of Debt and Hybrid Securities
+91-22-26449246
pradeepr@sebi.gov.in