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The ISIN or International Securities Identification Number is a unique 12-digit alpha-numeric code that determines specific security across the world. It has become the fastest standard securities identification number code in the world. The ISIN numbers are allocated by the country’s respective national numbering agency. By assigning the security with an ISIN number, it becomes universally recognisable. The allocated number helps the institutional investors track their investment consistently from worldwide markets.
In a measure to deepen and boost the liquidity in the corporate bond market, it was observed by SEBI that capping the ISINs will reduce the fragmentation in the primary market and increase the liquidity in the secondary market. Henceforth, the present circular is issued by SEBI to further cap the number of ISINs maturing in a financial year for debt securities issued on a private-placement basis.
Table of Contents
The issuance of the present circular has replaced Paragraphs (1), (2) and (3) of Chapter 8 of the operational circular dated 10th August 2021. It is stated that the following shall comply with regard to International Securities Identification Numbers for debt securities issued on a private-placement basis.
The provisions of the circular shall be made effective from 1st April 2023 for the International Securities Identification Numbers utilised to issue debt securities. However, the newly capped limits shall not be applicable till 31st March 2023 for ISINs utilised for the issuance of debt securities and due for maturing in a later year.
Moreover, for the debt securities issued on or after 1st April 2023, it is mandatory that all ISINs corresponding to these issues (including ISINs issued before 1st April 2023) and maturing in any financial year shall stick to the limit specified in the revised circular.
The circular further through below illustration explains the application of the circular:
The revised circular of the International Securities Identification Number states that the stock exchanges[1] and depositories have to perform the below-mentioned functions:
The International Securities Identification Number provides a uniform way of providing a unique number to security. Simply put, an ISINS number helps identify security across world platforms and makes it universally recognisable. The SEBI, through this circular, has modified the ISINs for debt securities issued on a private placement basis. It is further stated that an issuer of debt securities could issue a maximum number of 14 ISINs. Moreover, out of the 14 ISINs, 9 ISINs shall be used for plain vanilla debt Securities, and 5 ISINs shall be used for market link and structured debt securities.
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