CIRCULAR
SEBI/HO/DDHS/DDHS_Div3/P/CIR/2021/0671 November 26, 2021
To,
All Registered Merchant Bankers
Madam/Sir
Sub: Publishing investor charter and disclosure of investor complaints by Merchant
Bankers on their websites for private placements of Municipal debt securities
1. With a view to provide investors relevant information about the primary market issuances
of municipal debt securities, an Investor Charter has been prepared by SEBI in
consultation with Merchant Bankers.
2. This charter is a brief document containing different services to investors at one single
place for ease of reference.
3. All registered Merchant Bankers are hereby advised to disclose on their websites, the
Investor Charter for private placements of municipal debt securities, as provided at
Annexure – A to this circular:
4. Additionally, in order to bring about transparency in the Investor Grievance Redressal
Mechanism, it has also been decided that all the registered Merchant Bankers shall
disclose on their respective websites, the data on complaints received against them or
against issues dealt by them and redressal thereof, on each of the aforesaid categories
separately as well as collectively, latest by 7th of succeeding month, as per the format
enclosed at Annexure – B to this circular.
5. The provisions of this circular shall come into effect from January 01, 2022.
6. This circular is being issued in exercise of powers conferred under Section 11(1) of the
Securities and Exchange Board of India Act, 1992, Regulation 30 of SEBI (Issue and
Listing of municipal debt securities) Regulations, 2015.
Page 1 of 9
Investors’ Charter-Pvt Placement- Municipal debt securities
7. This circular is available on the website of the Securities and Exchange Board of India at
www.sebi.gov.in under the category “Legal” and under the drop down “Circulars”.
Yours faithfully,
Deena Venu Sarangadharan
Deputy General Manager
Department of Debt and Hybrid Securities
Tel No. 022-2644-9266
Email Id – deenar@sebi.gov.in
Page 2 of 9
Investors’ Charter-Pvt Placement- Municipal debt securities
Annexure - A
PRIVATE PLACEMENT OF MUNICIPAL DEBT SECURITIES
VISION STATEMENT:
To continuously earn trust of investors and emerge as solution provider with integrity.
MISSION STATEMENT:
1. Act in investors’ best interests by understanding needs and developing solutions.
2. Enhance and customise value generating capabilities and services.
3. Disseminate complete information to investors to enable informed investment decision.
DESCRIPTION OF ACTIVITIES / BUSINESS OF THE ENTITY
Act as Merchant Banker to Private Placement of Municipal debt securities
DETAILS OF SERVICES PROVIDED TO INVESTORS
1. The issuer, the debenture trustee, and stock exchanges to host the Placement
Memorandum (PM) and compliance reports on their websites.
2. Any special tax benefits (under direct and indirect tax laws) for the investors shall be
mentioned in the PM.
3. Material event/ development or change having implications which may affect the issue or
the investor’s decision to invest in the municipal debt securities shall be disclosed in the
PM.
4. Names, addresses, telephone numbers, contact person, website addresses and e-mail
addresses of key intermediaries included in the preliminary placement memorandum (PPM)
and the PM.
5. The PM shall contain all material disclosures which are true, correct and adequate to
enable the applicants to take an informed investment decision.
6. Issuer can roll-over the municipal debt securities issued as per applicable guidelines.
7. Issuer can recall/redeem prior to maturity as per the call and put option disclosed in the PM.
Page 3 of 9
Investors’ Charter-Pvt Placement- Municipal debt securities
TIMELINES – MUNICIPAL DEBT SECURITIES (PVT. PLACEMENT)
Sr. Timeline for which Information where
Activity
No. activity takes place available
1 Filing of preliminary Website of SEBI and
placement memorandum stock exchange(s)
-
("PPM") with SEBI and Stock
exchanges
2 Filing of PM - Website of SEBI and
stock exchange(s)
3 Receipt of funds and within 2 working day -
Allotment of municipal debt from issue closure
securities
4 Dissemination of all As and when required Issuer, Debenture
information and compliance trustee and Stock
reports by issuer, debenture exchanges website
trustee and stock exchange
5 Commencement of trading within 4 working days Stock Exchanges
from issue closure website (please refer to
the Listing circular by
stock exchanges)
6 Option to roll-over the 21 days prior notice to Stock exchanges
securities with the Issuer investors
7 Option to buy back securities after the municipal Placement
with the Issuer debt securities are Memorandum
issued
8 Call and put option after the municipal Placement
debt securities are Memorandum
issued
9 Dissemination of all As and when required Issuer, Debenture
information and compliance trustee and Stock
reports by issuer, debenture exchanges website
trustee and stock exchange
RIGHTS OF INVESTORS
1. Right of receiving the refund as per the stipulated regulatory timeframe if the listing and
trading approval is not received and if delayed, penal interest along with the amount to be
received.
2. Receive clear, accurate and easy to understand, issue related documents in order to make
a well- informed investment decision.
3. Satisfactory response to investor queries.
4. Right of free transferability, nomination subject to applicable laws and regulations.
Page 4 of 9
Investors’ Charter-Pvt Placement- Municipal debt securities
DOs AND DONTs FOR THE INVESTORS
DOs
1. Check the eligibility to apply as per the terms of the PPM and PM and applicable law.
2. Eligible Investors to whom the PM has been issued shall apply for the Issue.
3. The investor is advised to go through and understand the PPM and PM, its terms and
conditions, all types of covenants, clauses pertaining to security, events of defaults, cross
defaults, etc. thoroughly.
4. Application form duly completed and accompanied with necessary documents are to be
submitted to the entity.
5. The name of the applicant’s bank, type of account and account number must be duly
completed by the applicant.
6. Abide by the terms and conditions of the investment and timelines involved in the issue
process.
7. Ensure accurate updation of demographic details with depositories - including the address,
name, investor status, bank account details, PAN, e-mails addresses, contact details etc.
8. Ensure active demat/ broking account before investing, as municipal debt securities will be
allotted in dematerialized form.
9. The fund pay-in by the successful bidders will be made only from the bank account(s), which
have been provided / updated in the electronic book mechanism system (if issuance through
EBP mechanism).
10. Ensure relevant documents as per statutory requirements are submitted for Applications
under power of attorney or by limited companies, corporate, trust etc.
DON’Ts
1. Do not make an application below the minimum application amount.
2. Do not submit Applications on plain paper or on incomplete or illegible Application Forms.
3. Do not apply if you are not competent to contract under the Indian Contract Act, 1872.
4. Do not submit fictitious applications.
5. Do not make incomplete application. (Application forms without PAN shall be considered
incomplete and are liable to be rejected).
Page 5 of 9
Investors’ Charter-Pvt Placement- Municipal debt securities
INVESTOR GRIEVANCE REDRESSAL MECHANISM AND HOW TO ACCESS IT
Investor Complaint
Issuer (for email ID refer to
Placement Memorandum)
Scores (https:/scores.gov.in)
Stock Exchanges
(www.nseindia.com;
www.bseindia.com )
Registrar to Issue/Offer
(Mainly for post issue/
Merchant Banker
allotment related grievances)
(for email ID refer to the
(refer Placement Document
Placement Documents)
for email id)
TIMELINES FOR RESOLUTION OF INVESTOR GRIEVANCES IN A PRIVATE PLACEMENT
OF MUNICIPAL DEBT SECURITIES
Sr. • A c S t c iv o i r ty e s No. of calendar
No days
(https:/scores.gov.in)
1 Investor grievance received by the merchant banker T
2 Merchant banker to identify the concerned person T+1
(company/ intermediary) and it shall be endeavoured to
forward the grievance to the said person on T day itself
3 The company/ concerned intermediary to respond to the X
merchant banker with an acceptable reply
4 Investor may escalate the pending grievance, if any, to a T+21
senior officer of the merchant banker of rank of Vice
President or above
5 Merchant banker, the company/ concerned Between T and X
intermediary/ies and the investor shall exchange between
themselves additional information related to the grievance,
wherever required
6 Merchant Banker to respond to the investor with the reply Upto X+3
7 Best efforts will be undertaken by merchant banker to respond to the grievance
within T+30
Page 6 of 9
Investors’ Charter-Pvt Placement- Municipal debt securities
Nature of investor grievance for which the aforesaid timeline is applicable
1. Non-receipt of refund order(s), interest warrant(s), cheque(s) etc.
2. Non-credit of municipal debt securities in demat account
3. Any other grievance as may be informed from time to time
Mode of receipt of investor grievance
The following modes of receipt will be considered valid for processing the grievances in the
timelines discussed above
1. Letter from the investor addressed to the merchant banker/issuer/stock exchanges/registrar
to issue at their address mentioned in the preliminary placement memorandum/placement
memorandum, detailing nature of grievance, details of application, details of bank account,
date of application etc.
2. E-mail from the investor addressed to the merchant banker at its e-mail address mentioned
in the offer document, detailing nature of grievance, details of application, details of bank
account, date of application etc.
3. On SEBI SCORES platform
Nature of enquiries for which Merchant Banker shall endeavour to resolve such enquiries/
queries promptly during the issue period.
1. Process for applying in the Private placement and making payments
2. Terms of the private placement, allotment methodology, Issue Period, date of allotment, date
of listing
3. Any other query of similar nature
RESPONSIBILITIES OF INVESTORS (EXPECTATIONS FROM THE INVESTORS)
1. Investors should read the PPM and the PM, application form, and issue related literature
carefully and fully before investing.
2. Consult his or her own tax consultant with respect to the specific tax implications.
3. Investors should ensure active demat/ broking account before investing.
Page 7 of 9
Investors’ Charter-Pvt Placement- Municipal debt securities
Annexure – B
Format for Investors Complaints Data to be displayed by Registered
Merchant Bankers on their respective websites (For each category, separately
as well as collectively)
Data for every month ending -
Received Carried Received Resolved Pending Pending Averag
SN from forward during during at the end complaints e
from the the of month > 3 month Resolut
previous month month* # ion
month
time^
(in
days)
1 Directly from
Investors
2 SEBI
(SCORES)
3 Stock
Exchanges
(if relevant)
4 Other
Sources (if
any)
5 Grand Total
Trend of monthly disposal of complaints for the financial year:
SN Month Carried Received Resolved Pending at the
forward from during the during the end of month #
previous month month *
month
1 April-YYYY
2 May-YYYY
3 June-YYYY
…….
12 March - YYYY
Grand Total
^ Average Resolution time is the sum total of time taken to resolve each complaint in days,
in the current month divided by total number of complaints resolved in the current month.
* Inclusive of complaints of previous months resolved in the current month.
# Inclusive of complaints pending as on the last day of the month.
Page 8 of 9
Investors’ Charter-Pvt Placement- Municipal debt securities
Last 3 years’ trend
Year Carried Received Resolved Pending at the
SN forward from during the during the end of the
previous year particular particular year particular year
year
1 2018-19
2 2019-20
3 2020-21
Grand
Total
Page 9 of 9