Additional requirements for the issuers of transition bonds

SEBI vide its notification dated 4^th May 2023 states the additional requirements for the issuers of transition bonds

Disclosure in the offer document for public issues /private placements of such transition bonds:

a. To differentiate transition bonds from other categories of green debt security, Issuer of transition bonds shall use a denotation ‘GB-T’. The denotation shall be disclosed in the offer documents on the cover page and in type of instrument field in the term sheet.

b. Transition Plan, which shall contain the following:

(i) Details of interim targets*/ milestones along with an indicative timeline for achieving the targets. *interim targets should also reflect the indicative figure regarding how much emissions the issuer is envisaging to reduce

(ii) Brief of the project implementation strategy

 (iii) Details regarding the usage of technology for the project implementation

(iv) Mechanism to oversee the utilization of the funds raised through transition bonds and the implementation of the transition plan. Issuers may form a committee to oversee the implementation and ensure timely completion of the defined targets.

Disclosure in the Centralised Database for corporate bonds:

 a. An issuer shall disclose the denotation in the Centralized Database for corporate bonds/ debentures by filling the denotation i.e. GB-T in sub point 6 i.e. Others (Please specify) of point 10. i.e. Type of Instrument of Annex-XIV-A to Chapter XIV (Centralized Database for corporate bonds/ debentures) of the Operational Circular dated August 10, 2021 (and as amended from time to time).

b. The Depositories shall update the denotation i.e. GB-T as prefix in “instrument details” field in Centralized Database for corporate bonds/ debentures

 Disclosure to Stock Exchanges, in case of a revision in the transition plan:

An Issuer of transition bonds, during the year, shall disclose the revised transition plan along with an explanation for any such revision to the already disclosed plan; if applicable.

Disclosure in the Annual report:

The Issuer, shall disclose the transition plan along with a brief on the progress of the implementation of the transition plan.

 Stock Exchanges shall monitor the continuous disclosures made by issuers of transition bonds as specified.

This provisions of this circular shall come into force with immediate effect.

Link : https://www.sebi.gov.in/legal/circulars/may-2023/additional-requirements-for-the-issuers-of-transition-bonds_70937.html