Revised Lodge and Launch Framework Guidelines
The Malaysian Securities Commission (“CS‘) published the tenth revision of the Guidelines for Unlisted Capital Market Products under the Filing and Launching Framework (‘Revised guidelines‘) on May 30, 2022. The revised guidelines came into effect on June 1, 2022.
The revised guidelines set out the requirements to be complied with for the purposes of making unlisted capital market products available to the categories of persons referred to in paragraph 1 of part 1, schedule 5 of the Capital Markets Act 2007 and Services.
This article highlights the major revisions made under the Revised Guidelines to the Ninth Revision of the Unlisted Capital Markets Products Guidelines under the Lodge and Launch (‘9e Revision‘).
Corporate bonds and sukuk
- Paragraph 2.11(a) of Part 3 of Section B of the Revised Guidelines states that if the principal terms and conditions of bonds or sukuk denominated in ringgits which do not require a trust indenture allow the issuer of these corporate obligations or such sukuk to remedy a default in payment of principal or interest/profits/rents on such obligations or sukuk, the remedy period shall not exceed seven business days from the payment due date. This clarifies the corresponding provision of 9e Revision that does not specify when the seven-day appeal period begins.
- The revised guidelines specify that the filing of the signed trust indenture with the SC under paragraph 2.14 of part 3 of section B must be made by the party filing on behalf of the issuer.
- The deadline for submitting a post-issue notice to CS under paragraph 4.07 of Part 3 of Section B of the Revised Guidelines for all issues of corporate and sukuk bonds has been extended to seven business days after the end of the month in which the corporate bonds or sukuk were issued. The deadline provided for by 9e The review was seven business days from the date of issue.
- Paragraph 5.08 of Part 3 of Section B of 9e The revision that requires an issuer to notify the SC of the redemption, in whole or in part, of corporate bonds or sukuk has been amended in two respects under the corresponding paragraph of Part 3 of Section B of the Guidelines revised:
- notice must be given to the SC for (a) a partial refund; (b) prepayment; (c) redemption of perpetual corporate or sukuk bonds where no fixed maturity date has been stated in the post-issue notice; and (d) any other redemption occurring on a date other than the maturity date indicated in the post-issue notice; and
- the notification period to the SC is now seven working days after the end of the month in which the corporate bonds or sukuk were redeemed and no longer seven working days after the date of redemption.
5. The following provisions have been introduced in Part 3 of Section B of the revised guidelines:
- Section 5.09 which identifies the party authorized to be the responsible party for submitting the redemption notice;
- Section 5.10 which requires that the responsible party responsible for submitting the redemption notice be specified in the post-issue filing or notice; and
- Section 5.11 which requires the responsible party who submitted the post-issue notice to notify CS as soon as possible if there is a change to the due date submitted in the post-issue notice.
6. Copies of announcements made in accordance with paragraphs 6.08(c) and 6.08(d) of Part 3 of Section B of the Revised Guidelines must now be made available to the CS upon request (paragraph 6.08(e) of the Revised Guidelines). Part 3 of Section B of the Revised Guidelines). This replaces the requirement of the 9e Revision to provide copies of these announcements to the SC within two business days.
7. Paragraph 6.12 of Part 3 of Section B of the Revised Guidelines clarifies that in the event of an increase in a debt or sukuk program, the issuer is required to file, through his housing partyall relevant information and documentation with the SC and comply with the relevant requirements of Part 3 of Section B of the Revised Guidelines.
8. Where the consent of bondholders or sukuk holders is required for any proposed extension of a debt or sukuk program, copies of announcements made pursuant to paragraphs 6.14(c) or 6.14(d) of the Part 3 of Section B of the Revised Guidelines are now to be made available to CS upon request (Paragraph 6.14(e) of Part 3 of Section B of the Revised Guidelines). This replaces the requirement of the 9e Revision to provide copies of these announcements to the SC within two business days.
9. The time period provided in paragraph 2.20(a) of Part 4 of Section B of the Revised Special Purpose Entity (SPV) Guidelines for accepting a transfer of assets or issuing asset-backed securities (“abs‘) was extended for 60 working days under the 9e Revision to 90 working days from the date of filing of the securitization transaction with the SC.
10. It is specified in paragraph 3.01 of part 4 of section B of the revised guidelines that all information and documents relating to an issue of ABS must be filed with the SC by the issuer. through his housing party.
Convertible Notes and Islamic Convertible Notes to Specific Registrants
11. The deadline set out in paragraph 3.04 of Part 5 of Section B of the Revised Guidelines for the issuance of Convertible Notes (CN Eligible) or Islamic Convertible Notes (ICN Eligible) has been extended by 60 business days in respect of 9e Revision at 90 working days from the date of filing.
12. As a transitional provision, paragraph 4.07 of Section D of the Revised Guidelines specifies that in the event of an extension of a debt or sukuk program previously approved or authorized by the SC, the issuer is required to file , through his housing partyall relevant information and documents with the SC and comply with the relevant requirements of Part 3 of Section B of the Revised Guidelines.