Sebi issues new guidelines to streamline operations of credit rating agencies

"In order to promote ease of doing and bring about uniformity in dealing with appeals, based on consultation with stakeholders, including CRAs (Credit Rating Agencies), it has been decided to provide specific timelines for dealing with appeals made by the issuer in respect of rating actions carried out pursuant to periodic surveillance of ratings," it added.

The changes mandate that CRAs communicate ratings to companies within one working day of the rating committee meeting, with an outer limit set to ensure promptness.

Further, companies will have three working days to request a review or appeal of the rating decision, and the dissemination of the press release on the CRA's website and intimation of the same to the stock exchange or trustee must occur within 7 working days of the rating committee meeting.

"CRAs shall continue to maintain records in respect of the said disclosures for a period of 10 years, which may be shared with debenture trustees upon request.

"Further, disclosures in respect of the said aspects shall continue to be made available by the CRAs on their website under the issuer-specific press releases/ rating rationale section of the respective issuer, wherever applicable," the regulator said.

Sebi has also outlined specific timelines for certain types of disclosures, such as a list of non-cooperative issuers that should be updated daily, ensuring that stakeholders are promptly informed about issuers who fail to cooperate with rating agencies.

For disclosures regarding ratings that have not been accepted by issuers, CRAs are required to maintain this information for 12 months.

To ensure compliance, the circular will be monitored through the half-yearly internal for rating agencies, as mandated under the CRA norms, Sebi said.

The process aims to uphold investor protection and foster the development and regulation of the securities market.