THE GAZETTE OF INDIA

EXTRAORDINARY

PART –II – SECTION 3 – SUB SECTION (ii)

PUBLISHED BY AUTHORITY

SECURITIES AND EXCHANGE BOARD OF INDIA

NOTIFICATION

Mumbai, the 7^th September, 2006

SECURITIES AND EXCHANGE BOARD OF INDIA

(DEBENTURE TRUSTEES) (AMENDMENT) REGULATIONS, 2006

S.O No. 1451 (E). In exercise of the powers conferred by section 30 of the Securities and Exchange Board of India Act, 1992 (15 of 1992), the Board hereby makes the following Regulations to further amend the Securities and Exchange Board of India (Debenture Trustees) Regulations, 1993, namely :-

1. These Regulations may be called the Securities and Exchange Board of India (Debenture Trustees) (Amendment) Regulations, 2006.

2. They shall come into force on the date of their publication in the Official Gazette.

3. In the Securities and Exchange Board of India (Debenture Trustees) Regulations, 1993:-

(i) in regulation 2 –

a. clauses (a) and (aa) shall be renumbered as clause (aa) and (b) respectively thereof;

b. before clause (aa) so renumbered, the following clause shall be inserted, namely:-

“(a) “Act” means the Securities and Exchange Board of India Act, 1992 (15 of 1992);”

c. after clause (aa) so renumbered, the following clauses shall be inserted, namely:-

“(ab) “body corporate” shall have the meaning assigned to it in or under clause (7) of section 2 of the Companies Act, 1956 (1 of 1956);

(ac) “certificate” means a certificate of registration granted or renewed by the Board under these regulations;

(ad) “change of status or constitution” in relation to a debenture trustee -

(i) means any change in its status or constitution of whatsoever nature; and

(ii) without prejudice to generality of sub-clause (i), includes –

(A) amalgamation, demerger, consolidation or any other kind of corporate restructuring falling within the scope of section 391 of the Companies Act, 1956 (1 of 1956) or the corresponding provision of any other law for the time being in force;

(B) change in its managing director or whole-time director; and

(ae) “change in control”, in relation to a debenture trustee, means:-

(i) if its shares are listed on any recognised stock exchange, change in control within the meaning of regulation 12 of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997;

(ii) in any other case, change in the controlling interest in the body corporate;

Explanation: For the purpose of sub-clause (ii), the expression “controlling interest” means an interest, whether direct or indirect, to the extent of at least fifty one percent. of voting rights in the body corporate;”

d. after clause (b) so renumbered, the following clauses shall be inserted, namely:-

“(ba) “debenture” means a debenture within the meaning of sub-section (12) of section 2 of the Companies Act, 1956 (1 of 1956);

(bb) “debenture trustee” means a trustee of a trust deed for securing any issue of debentures of a body corporate;”

e. after clause (e), the following clause shall be inserted, namely:-

“(ea) “issue” means an offer of sale of securities by any body corporate or by any other person or group of persons on its or their behalf, as the case may be, to the public, or the holders of securities of such body corporate or person or group of persons and includes a private placement of debentures made by a listed company, which are proposed to be listed;”

f. clause (h) shall be omitted;

g. after clause (i), the following clause shall be inserted, namely:-

“(ia) “trust deed” means a deed executed by the body corporate in favour of the trustees named therein for the benefit of the debenture holders;”

h. in clause (j), the words “and the rules” occurring after the words “defined in the Act” and the words “or the rules, as the case may be” occurring at the end shall be omitted;

(ii) in regulation 3, after sub-regulation (1), the following sub-regulation shall be inserted, namely:-

“(1A) An application for registration made under sub-regulation (1) shall be accompanied by a non-refundable application fee as specified in Schedule II.”

(iii) in regulation 9, after sub-regulation (1), the following sub-regulation shall be inserted, namely:-

“(1A) An application for renewal made under sub-regulation (1) shall be accompanied by a non-refundable application fee as specified in Schedule II.”

(iv) after regulation 9, the following regulations shall be inserted, namely:-

“Conditions of registration

9A. (1) Any registration granted under regulation 8 or any renewal granted under regulation 9 shall be subject to the following conditions, namely:-

(a) where debenture trustee proposes to change its status or constitution, it shall obtain prior approval of the Board for continuing to act as such after the change;

(b) it shall pay the fees for registration or renewal, as the case may be, in the manner provided in these regulations;

(c) it shall take adequate steps for redressal of grievances of the investors within one month of the date of the receipt of the complaint and keep the Board informed about the number, nature and other particulars of the complaints received and the manner in which such complaints have been redressed;

(d) it shall maintain capital adequacy requirements specified in regulation 7A at all times during the period of the certificate or renewal thereof;

(e) it shall abide by the regulations made under the Act in respect of the activities carried on by it as a debenture trustee.

(2) Nothing contained in clause (a) of sub-regulation (1) shall affect the obligation to obtain a fresh registration under section 12 of the Act in cases where it is applicable.

Time period for disposal of application and period of validity of certificate

9B. (1) The Board shall within three months of receipt of all information for considering the application for grant of registration made under regulation 8, or for its renewal made under regulation 9, take a decision thereon and send intimation to the applicant.

(2) The certificate of registration granted under regulation 8 and its renewal granted under regulation 9, shall be valid for a period of three years from the date of its issue.”

(v) in Schedule II –

a. in paragraph 1, for the words “Rupees five lacs”, the words “ten lakh rupees” shall be substituted;

b. in paragraph 2, for the words and figures “Rs. 2.5 lacs”, the words “five lakh rupees” shall be substituted;

c. after paragraph 3, the following paragraph shall be inserted, namely:-

“3A. The non-refundable fee payable along with an application for registration under sub-regulation (1A) of regulation 3 or an application for renewal of registration under sub-regulation (1A) of regulation 9 shall be a sum of twenty five thousand rupees.”

d. in paragraph 4, for the words and figures “paragraphs 1 and 2” the words and figures “paragraphs 1, 2 and 3A” shall be substituted.

F.No. SEBI/LAD/DOP/ 0709 /2006

M. DAMODARAN

CHAIRMAN

SECURITIES AND EXCHANGE BOARD OF INDIA

Footnotes :

1. Securities and Exchange Board of India (Debenture Trustee) Regulations, 1993, were published in the Gazette of India on December 29, 1993, vide No.SEBI/LE/12/93.

2. It was subsequently amended –

(a) on November 28, 1995 by the Securities and Exchange Board of India (Payment of Fees) (Amendment) Regulations, 1995 vide S.O. No.939 (E).

(b) on January 5, 1998 by the Securities and Exchange Board of India (Debenture Trustees) (Amendment) Regulations, 1998 vide S.O. No.16(E).

(c) on September 30, 1999 by the Securities and Exchange Board of India (Debenture Trustees) (Amendment) Regulations, 1999 vide S.O. No.795(E).

(d) on February 17, 2000 by the Securities and Exchange Board of India (Debenture Trustees) (Amendment) Regulations, 2000 vide S.O. No.135(E).

(e) on August 8, 2000 by the Securities and Exchange Board of India (Debenture Trustees) (Second Amendment) Regulations, 2000 vide S.O. No.743(E).

(f) on March 28, 2000 by the Securities and Exchange Board of India (Appeal to Securities Appellate Tribunal) (Amendment) Regulations, 2000 vide S.O. No.278(E).

(g) on May 29, 2001 by the Securities and Exchange Board of India (Investment Advice by Intermediaries) (Amendment) Regulations, 2001 vide S.O. No. 476(E).

(h) on September 27, 2002 by the Securities and Exchange Board of India (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002 vide S.O. No.1045(E).

(i) on July 4, 2003 by the Securities and Exchange Board of India (Debenture Trustees) (Amendment) Regulations, 2003 vide S.O.No. 763(E).

(j) on March 10, 2004 by the Securities and Exchange Board of India (Criteria for Fit and Proper Person) Regulations, 2004 vide S.O. No. 398(E).

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