SEBI To Reduce Time Taken For Registration Of FPIs To Facilitate Ease Of Doing Business

Capital markets regulator Sebi on Tuesday said it will  reduce the time taken for granting registration to FPIs (Foreign Portfolio Investors), a move that will facilitate ease of doing business.
     
Also, the board approved the framework for adoption of cloud services by Sebi Regulated Entities (REs). It would be a principle-based framework containing nine broad principles which must be followed by REs for deploying cloud services.
     
With regards to foreign investors, Sebi said its approved proposals regarding procedural requirements for on-boarding FPIs in order to further reduce the time taken for granting registration to such investors.
     
Under the proposal, the regulator would grant registration on the basis of scanned copies of application forms, supporting documents and activation of trading post verification of physical documents, according to a statement issued by the regulator after its board meeting.
     
Further, Sebi would accept the use of digital signatures by FPIs for execution of registration related documents and allow verification of PAN by Designated Depository Participants (DDPs) through the Common Application Form (CAF) module available on the websites of the depositories.
     
Also, it would allow submission of unique investor group ID by FPI applicants in lieu of complete details of group constituents.
     
Sebi would permit "use of SWIFT mechanism for certification, by authorised bank officials, of copies of original documents submitted by FPIs to DDPs". This would reduce physical movement of documents and the time taken for registration.
     
In respect of framework for adoption of cloud services by REs, Sebi said the framework highlights the aspects associated with adoption of cloud services such as risk assessment; regulatory and legal compliances; rights, responsibilities, and accountabilities of RE; mandatory security measures and controls; and rights of Sebi and other government agencies.
     
"The framework will assist the REs in leveraging benefits of cloud computing as well as developing a new approach to deal with various issues related to cloud services such as safeguarding of sensitive information, country risk, disaster recovery, concentration risk, etc," Sebi said.
     
In addition, Sebi's board has approved certain regulatory interventions for the  corporate bond market.
     
In a bid to better protect the interests of debenture holders, Sebi has decided that, issuers of listed debt securities will incorporate suitable provisions in their Articles of Association, to cast obligation on the board of directors of the issuer to appoint the person nominated by its Debenture Trustee (DT) as a director in the event of default.
     
Further, corresponding amendments are to be made in the Debenture Trust Deed. The existing listed debt issuers are required to do the needful by September 30, 2023.
     
With a view to address any possible inefficiencies and delays due to such lack of regulatory mandate, it has been decided that public issue of debt securities and Non-Convertible Redeemable Preference Shares (NCRPS) would be kept open for subscription for a minimum period of three working days and maximum period of 10 working days.
     
Presently, there are no stipulations with respect to the duration for which a public issue of debt securities or NCRPS should be kept open.