SEBI directs debt instrument issuers to secure LEI code

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Companies with listed or about-to-be-listed non-convertible securities, securitised debt instruments and security receipts have now been mandated by the Securities and Exchange Board of India (SEBI) to obtain and report their Legal Entity Identifier (LEI) in the centralised database of corporate bonds.

LEI is a unique global identifier for legal entities participating in financial transactions. It 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, RBI directions, inter alia, mandate non-individual borrowers having aggregate exposure of above Rs 25 crore, to obtain LEI code.

Issuers having outstanding listed non-convertible securities as on August 31, 2023, shall report, or, as the case may be, obtain and report the LEI code in the centralised database of corporate bonds, on or before September 1 of this year.

Similarly, issuers having outstanding listed securitised debt instruments and security receipts as on August 31 of this year shall report and obtain and report the LEI code to the depositories, on or before September 1 of this year.

Further, issuers proposing to issue and list non-convertible securities, on or after September 1 shall report their LEI code in the centralised database of corporate bonds at the time of allotment of the ISIN. Similarly, issuers proposing to issue and list securitised debt instruments and security receipts, on or after September 1, 2023, shall report their LEI code to the depositories at the time of allotment of the ISIN.

The requirements of LEI for municipal securities issuers shall be specified later by SEBI.

In India, the LEI code may be obtained from Legal Entity Identifier India Ltd (LEIIL), a subsidiary of the Clearing Corporation of India Limited (CCIL). The depositories have been directed to map the LEI code to existing ISINs by September 30 this year. They have also been instructed to map the LEI code provided by the issuers with the ISIN at the time of activation of the ISIN, in case of future issuances.

SEBI has said that the circular shall come into effect immediately.