The Securities and Exchange Board of India (SEBI) on May 16, 2024, notified the Master Circular for ESG Rating Providers (“ERPs”).
The following has been stated: -
•ESG Rating Providers are regulated under the provisions of the Securities and Exchange Board of India (Credit Rating Agencies) Regulations, 1999 that inter-alia prescribe guidelines for registration of ERPs, general obligations of ERPs, manner of inspection, and code of conduct applicable to ERPs.
•ERPs are directed to comply with the conditions laid down in this master circular. Also, ERPs shall have the necessary systems and infrastructure in place for the implementation of this circular. The Board of Directors of the ERP shall be responsible for ensuring compliance with these provisions.
•Fees and other charges payable to SEBI are subject to Goods and Services Tax (GST) which is at present 18%.
•Some of the chapters of the circular are: -
(i)Chapter I mentions about the Registration, Approval, and Surrender Requirements.
(ii)Chapter II specifies about rating operations.
The provisions of the Master Circular shall come into force with immediate effect.
The detailed circular is given in the document below.
[Circular No. SEBI/HO/DDHS/POD3/P/CIR/2024/45]
