ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has enhanced duties/powers of debt securities trustees/investment agents including their obligation to regularly monitor payment of profit to the debt securities holders and redemption of the debt security.
The SECP has also revised general conditions for public offer of debt securities by "issuer" including companies, Special Purpose Vehicles or body corporate.
The SECP has proposed amendments in the Debt Securities Trustees Regulations, 2017 and Public Offering Regulations, 2017 through issuance of two notifications here on Thursday.
The Public Offering Regulations, 2017 apply to a public limited company or body corporate proposing to issue securities to the general public; an Offeror who intends to offer securities to the general public and sponsors of the public limited company or body corporate, the Consultants to the Issue, the Underwriter, the Book Runner, the Designated Institution, the Banker to an Issue, Investment Agent and Issuing and Paying Agent.
On the other hand, Debt Securities Trustees Regulations, 2017 provide a comprehensive regulatory framework under the Securities Act, 2015 for licensing and regulation of debt securities trustees (DSTs).
According to the S. R. O.1229 (I)/2020, one of the revised general conditions for public offer of debt securities is that in case of debt securities other than the commercial paper, it has appointed Debt Securities Trustee/investment agent. Previously the condition said that in case of debt securities, other than Commercial Paper and Sukuk, it has appointed debt securities trustee licensed by the Commission.
Another revised condition for public offer of debt securities is that the issuer shall report profit payment and redemption status of the securities on semiannual basis to the Commission, securities exchange, debt securities trustee/investment agent and issuing and paying agent, till complete redemption of the issue. Previously, the issuer shall report profit payment and redemption status of the securities on semiannual basis to the Commission, securities exchange, debt securities trustee, investment agent, and issuing and paying agent, till complete redemption of the issue.
The SECP has also revised the functions of the 'Consultant to the Issue'. The Consultants to the Issue" means any person licensed by the Commission to act as a Consultant to the Issue which may also be called Lead Manager or Advisor.
Under the revised Debt Securities Trustees Regulations, 2017, the arrangement for rendering services as Debt securities trustee/investment agent does not absolve the issuer of the obligations and responsibilities placed on it under the Act, the Companies Act, these Regulations and the issuance agreement. The Debt securities trustee/investment agent may incorporate additional clauses, provided that the additional clauses do not dilute or contravene the provisions of the Act, the Companies Act, these Regulations or the Issuance agreement.
Copyright Business Recorder, 2020
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