SEBI issues framework for Environmental, Social and Governance (ESG) Debt Securities (other than green debt securities)
SEBI, vide circular no. SEBI/HO/DDHS/DDHS-POD-1/P/CIR/2025/84 dated 05.06.2025 has introduced a framework for environmental, social and governance debt securities to facilitate funding for sustainable projects and bridge the gap for Sustainable Development Goals.
Key Takeaways:
- The Circular is issued in exercise of the powers conferred under Section 11(1) of the SEBI Act read with Regulations 55(1) of the SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2021to protect the interests of investors and regulate securities market.
- SEBI has introduced a detailed framework for the issuance and listing of ESG debt securities other than green bonds, specifically covering Social Bonds, Sustainability Bonds, and Sustainability-Linked Bonds (SLBs). These frameworks align with international standards like the ICMA Principles, Climate Bonds Standard, ASEAN Standards, and EU Standards, while being tailored for the Indian context.
- The key requirements include mandatory appointment of independent third-party reviewers/certifiers for verification and certification, comprehensive disclosure obligations in offer documents and annual reports including fund utilization tracking and impact reporting, and strict anti-purpose washing measures requiring continuous monitoring and potential early redemption if funds are misused.
- Issuers must maintain decision-making processes for project eligibility, provide detailed impact assessments with quantitative performance measures where feasible, and SME exchange entities must comply with bi-annual disclosure requirements.
Ministry of Finance Notifies FEMA (Non-Debt Instruments) Amendment Rules, 2025.
The Department of Economic Affairs, Ministry of Finance through notification S.O.25499(E) dated 11.06.2025 issued the Foreign Exchange Management (Non-debt Instruments) (Amendment) Rules, 2025 to amend Rule 7 which deals with acquisition of equity instruments (other than share warrants) through rights issue or bonus issue to persons resident outside India under the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 (“Principal Regulations”).
Key Takeaways:
- The Amendment Rules have added a new sub-rule 7(2) to the Principal Regulations stating that the Indian companies operating in sectors where FDI is prohibited can now issue bonus shares to existing non-resident shareholders, provided the ownership pattern remains unchanged.
- Any bonus shares issued to such shareholders prior to the commencement of the new sub-rule 7(2) of the Amendment Rules shall be deemed to have been issued in accordance with the provisions of Principal Regulations or the Foreign Exchange Management (Transfer or issue of Security by a Person Resident outside India) Regulations, 2000 or the Foreign Exchange Management (Transfer or issue of Security by a Person Resident outside India) Regulations, 2017, as may be applicable.
- Issuance of bonus shares is permitted only if the shareholding pattern of such shareholders is not changed pursuant to the issuance.
- They shall come into force on the date of their publication in the Official Gazette.
RBI issues project finance norms for banks, NBFCs.
RBI issued RBI (Project Finance) Directions, 2025 effective from 01.10.2025 to provide a harmonised framework for financing of projects in infrastructure and non-infrastructure sectors.
Key Takeaways:
- The provision of these Directions shall apply to all Commercial Banks (including small finance banks), all NBFCs (including Housing Finance Companies), all Primary (urban) Cooperative Banks and All India Financial Institutions.
- Provisioning for under-construction infrastructure projects has been reduced to 1%, significantly lower than earlier draft proposals. For commercial real estate (CRE) projects under construction, it’s set at 1.25%, easing capital burden for lenders.
- For projects where the aggregate exposure of all lenders exceeds ₹1,500 crore, the exposure floor for an individual lender is set at 5% or ₹150 crore, whichever is higher.
- Lenders can now grant DCCO (Date of Commencement of Commercial Operations) extensions of up to 3 years for infrastructure projects and 2 years for non-infrastructure projects, providing relief for genuine project delays.
CCPA issues advisory on dark patterns for e-commerce platforms.
The Central Consumer Protection Authority (CCPA) has issued an advisory vide Circular No. CCPA-1/1/2023-CCPA dated 05.06.2025 regarding self-audits by e-commerce platforms to detect Dark Patterns.
Key Takeaways:
- The Guidelines for Prevention and Regulation of Dark Patterns, 2023 categorically encompasses 13 types of Dark Patterns.
- The CCPA has noted instances of Dark Patterns on e-commerce platforms despite the guidelines for prevention and regulation of dark patterns.
- The CCPA has advised all e-commerce platforms to take necessary steps to ensure that their platforms do not engage in such deceptive and unfair trade practices that constitute dark patterns. They are advised to conduct self-audits to identify Dark Patterns within three months from the issue date of this Advisory.
- Upon completion of the self-audit, platforms are encouraged to submit a self-declaration confirming that their platform does not indulge in any Dark Patterns. This self-declaration by the platforms will enable fair digital ecosystem along with building trust between consumers and e-commerce platforms.
