Regulation 9 - Conditions of certificate - Securities and Exchange Board of India (Credit Rating Agencies) Regulations, 1999

Conditions of certificate 1 [***] 9. 2 [***] The certificate granted under regulation 8 3 [or 8A] shall be, subject to the following conditions, namely: (a) the credit rating agency shall comply with the provisions of the Act, the regulations made there under and the guidelines, directives, circulars and instructions issued by the Board from time to time on the subject of credit rating. (b) 4 [***] where any information or particulars furnished to the Board by a credit rating agency: (i) is found to be false or misleading in any material particular ; or (ii) has undergone change subsequently to its furnishing at the time of the application for a certificate; the credit rating agency shall forthwith inform the Board in writing 5 [;] 6 [***] 7 [(c) where the credit rating agency proposes 8 [change in control], it shall obtain prior approval of the Board for continuing to act as such after the change.] 9 [(d) the credit rating agency shall at all times maintain a minimum net worth of rupees twenty five crore. Provided that a credit rating agency already registered with the Board under Securities and Exchange Board of India (Credit Rating Agencies) Regulations, 1999, having a net worth less than rupees twenty five crores, shall, increase its net worth to the specified amount within a period of three years from the date of notification of the Securities and Exchange Board of India (Credit Rating Agencies) (Amendment) Regulations, 2018. (e) the promoter of the credit rating agency, in terms of regulation 4, shall maintain a minimum shareholding of 26% in the credit rating agency for a minimum period of three years from the date of grant of registration by the Board. Provided that this clause shall not be applicable to a credit rating agency already registered with the Board under Securities and Exchange Board of India (Credit Rating Agencies) Regulations, 1999, at the commencement of Securities and Exchange Board of India (Credit Rating Agencies)(Amendment) Regulations, 2018. 10 [(f) a credit rating agency shall not carry out any activity other than the rating of securities 11 [ that are listed or proposed to be listed on a stock exchange recognized by the Board ] . Nothing contained in these regulations shall preclude a credit rating agency from 13 [ carrying out any activity as may be specified by the Board or ] rating of financial instruments under the respective guidelines of a financial sector regulator or any authority as may be specified by the Board: 12 [ Explanation: ─ For the purposes of this clause, the ratings undertaken by a credit rating agency under the respective guidelines of a financial sector regulator or authority shall be under the purview of the respective financial sector regulator or authority. ] Provided that all other activities shall be segregated to a separate entity within a period of two years from the date of notification of Securities and Exchange Board of India (Credit Rating Agencies)(Amendment) Regulations, 2018.]] ************ NOTES:- 1 The words and validity period omitted by the SEBI (Credit Rating Agencies) (Amendment) Regulations, 2011 w.e.f. 05.07.2011 2 Numbering of sub-regulation (1) omitted by the SEBI (Credit Rating Agencies) (Amendment) Regulations, 2011 w.e.f. 05.07.2011 3 The words or 8A omitted by the Securities and Exchange Board of India (Change In Conditions Of Registration Of Certain Intermediaries) (Amendment) Regulations, 2016 w.e.f. 08-12-2016. Prior to this the words or 8A were inserted by the SEBI (Credit Rating Agencies) (Amendment) Regulations, 2011 w.e.f. 05.07.2011 4 Numbering of sub-regulation omitted, Ibid. 5 Substituted for . , Ibid. 6 Omitted, Ibid. Prior to its omission, sub-clause (2), read as under: (2) the period of validity of certificate of registration shall be three years; 7 Inserted by the SEBI (Credit Rating Agencies) (Amendment) Regulations, 2010, w.e.f. 19.03.2010. 8 Substituted for to change its status or constitution by the SEBI (Change in Conditions of Registration of Certain Intermediaries) (Amendment) Regulations, 2011, w.e.f 13.04.2011. 9 Clauses (d)(e) and (f) inserted by the SEBI (Credit Rating Agencies)(Amendment) Regulations, 2018, w.e.f. 30-05-2018 10 Substituted by the SEBI (Credit Rating Agencies)(Second Amendment) Regulations, 2018. Prior to this, clause (f) read as: (f) a credit rating agency shall not carry out any activity other than the rating of securities offered by way of public or rights issue. Provided that nothing in these regulations shall prohibit a credit rating agency from engaging in any other activity in so far as it may be required by a financial sector regulator as defined under section 3(18) of the Insolvency and Bankruptcy Code, 2016. Provided further that if a credit rating agency is carrying out activities other than the activity required by a financial sector regulator, such activity shall be segregated to a separate entity within a period of two years from the date of notification of Securities and Exchange Board of India (Credit Rating Agencies)(Amendment) Regulations, 2018 11. Substituted vide Notification No. SEBI/LAD-NRO/GN/2021/29 dated 03-08-2021 before it was read as offered by way of public or rights issue 12. Inserted vide Notification No. SEBI/LAD-NRO/GN/2021/29 dated 03-08-2021 13. Inserted vide Notification No. SEBI/LAD-NRO/GN/2022/69 dated 24-01-2022