Sebi introduces legal identifier system for issuers with listed NCDs

Capital markets regulator Sebi introduced Legal Entity Identifier system for issuers that have listed or planning to list non-convertible securities, securitised debt instruments and security receipts

Capital markets regulator Sebi on Wednesday introduced Legal Entity Identifier (LEI) system for issuers that have listed or planning to list non-convertible securities, securitised debt instruments and security receipts.

LEI, a unique global identifier for legal entities participating in financial transactions, is designed to create a global reference data system that uniquely identifies every legal entity, in any jurisdiction, that is party to a financial transaction. It is a unique 20-character code to identify legally distinct entities that engage in financial transactions.

Presently, Reserve Bank of India (RBI) mandates non-individual borrowers having aggregate exposure of above Rs 25 crore to obtain LEI code.

In view of this, Sebi said that issuers having outstanding listed non-convertible securities as on August 31 will have to obtain and report the LEI code in the centralised database of corporate bonds by September 1, according to a circular.

Similarly, issuers having outstanding listed securitised debt instruments and security receipts as on August 31 will have to obtain and report the LEI code to the depositories by September 1.

Further, issuers proposing to list non-convertible securities and securitised debt instruments as well as security receipts on or after September 1 will have to report their LEI code to the centralised database of corporate bonds and depositories respectively at the time of allotment of the ISIN.

Sebi said that the requirement of LEI for issuers proposing to list or having outstanding municipal debt securities will be specified later.

The LEI code can be obtained from Legal Entity Identifier India Ltd, a subsidiary of the Clearing Corporation of India Ltd, which has been recognised by the RBI as issuer of LEI and is accredited by the Global Legal Entity Identifier Foundation (GLEIF) as the local operating unit in India for issuance and management of LEI code.

The regulator has asked depositories to map the LEI code to existing ISINs by September 30, and map the LEI code provided by the issuers with the ISIN at the time of activation of the ISIN for future issuances.

The circular would come into force with immediate effect, the Securities and Exchange Board of India (Sebi) said.