In Short: Sebi, a market regulator, has proposed modifications to the debenture trustee laws, aiming to clarify the “pecuniary relationship” between Debenture Trustees (DT) and issuers until September 11. The appointment of a specific financial relationship with the issuer has been limited for an entity. Sebi’s working committee recommended against considering DT compensation when evaluating the entity’s financial relationship with the issuer, as it must account for two percent or more of the entity’s gross turnover or total income.
Sebi’s working group suggests that remuneration payable to DTs should not be considered in assessing the pecuniary relationship between DT and issuer. The regulator proposes excluding pecuniary relationships from computation of remuneration payable to DTs and disclosing remuneration/revenue for debenture trusteeship services as a percentage of total services.
