The Securities and Exchange Board of India (SEBI) has issued an updated master circular for Credit Rating Agencies (CRAs), bringing together the operative directions issued under the SEBI (Credit Rating Agencies) Regulations, 1999 into a single consolidated reference and superseding the earlier CRA circulars listed in the appendix. Actions taken and applications made under the rescinded circulars are preserved through deeming provisions mapped to the corresponding requirements in the master circular. The master circular consolidates requirements spanning registration and ownership changes, rating operations, disclosures and audits. It directs CRAs to use the SEBI Intermediary Portal for registration and related requests, reiterates the need for SEBI’s prior approval for any change in control (with approvals valid for 180 days), and clarifies how fresh registration applies in business transfers. It also sets out an “orderly migration” framework for cases of CRA suspension, cancellation or surrender, including restrictions on taking new mandates, client ability to withdraw assignments without additional cost, and conditions around the continuing validity or withdrawal treatment of ratings. On conduct of ratings, the circular standardises rating symbols and definitions across instruments (including issuer ratings, structured finance and credit-enhanced ratings), prescribes a standard press release template with minimum disclosures (including outlook/watch descriptors, liquidity indicators and rating sensitivities), and consolidates monitoring and default-recognition expectations supported by monthly “No Default Statements” from issuers. It further compiles requirements on handling issuer non-cooperation (including INC tagging and daily publication of non-cooperative issuer lists), withdrawal and provisional rating conditions and validity periods, credit enhancement disclosure and due diligence expectations, probability-of-default benchmark disclosures, machine-readable and archived website disclosure practices, half-yearly internal audits with specified eligibility and rotation for auditors, outsourcing principles, and firewall measures between CRAs and non-rating affiliates.
Securities & Exchange Board of India 2025-07-11
Securities and Exchange Board of India issues updated master circular consolidating credit rating agency requirements
SEBI issued a master circular for Credit Rating Agencies (CRAs), consolidating directions under the SEBI (Credit Rating Agencies) Regulations, 1999. It standardizes registration, rating operations, disclosures, audits, and introduces an "orderly migration" framework for CRA suspension, cancellation, or surrender. It mandates standardized rating symbols, a press release template, and monthly "No Default Statements" from issuers, detailing conduct expectations and compliance measures.