Sebi proposes new norms for green bonds

New Delhi: To help generate low-cost funds for renewable energy ventures, capital markets regulator Sebi today proposed new norms for issuance and listing of green bonds.

The regulator has approved a proposal for issue of draft regulation, for disclosure requirements for issuance and listing of green Bonds, on which comments would be sought from all stakeholders before deciding the final norms.

After the board meeting, Sebi said it has "approved the proposal for initiation of public consultation process for disclosure requirements for issuance and listing of Green Bonds, which are in line with the requirements as provided in Green Bond Principles as recommended by International Capital Market Association."

The issuance and listing of green bonds in India does not require any amendment to the Sebi (Issue and Listing of Debt Securities) Regulations.

The issue, listing and disclosure requirements as prescribed will continue to be applicable, like any regular corporate bond issuance.

Welcoming the various initiatives take by Sebi today, Economic Affairs Secretary Shaktikanta Das said the decision on green bonds is very timely and coincides with climate summit COP 21 currently under way in Paris.

"This demonstrates India' s commitment... Finance Ministry, RBI, Sebi working together with positive interaction and understating. Will continue to work for reforms and stability," he tweeted.

Besides, Sebi has approved a proposal to issue public consultation on introduction of "Primary Market Debt Offering through private placement on electronic Book".

The move is expected to help in reducing cost and time taken for such issuance.

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).

The entities such as stock exchanges, depositories and merchant bankers with net worth above Rs 100 crore may apply to Sebi for setting up EBPs.

Further, Sebi has proposed issue draft papers for revival of public issuance of convertible securities by listed entities.