Sebi Enables Credit Rating Agencies to Give Ratings in GIFT City: A Landmark Initiative
Elevating GIFT City’s Financial Landscape
In an unprecedented move, the Securities Exchange Board of India (Sebi) has empowered credit rating agencies to extend their services to the burgeoning Gujarat International Finance Tec-City, known as GIFT City. This strategic decision aligns with Estabizz Fintech Private Limited’s mission to harness global market opportunities and streamline financial processes for businesses poised for international growth.
Harmonizing with IFSCA Regulations
The inclusion of International Financial Services Centres Authority (IFSCA) into the Sebi’s directory of financial sector regulators, as per the master circular issued on May 16, 2024, marks a cornerstone for regulatory compliance within GIFT City. This integration signifies that the credit rating agencies are now authorized to rate financial instruments within the purview of the IFSCA’s guidelines, thus fostering a regulated environment for investment activities.
Sebi’s Circular Insights: Strengthening Rating Framework
Dated July 19, 2024, Sebi’s circular provides a clear mandate for credit rating agencies in GIFT City, underscoring the necessity of adherence to IFSCA standards. Key points from the circular are as follows:
- The IFSCA is entrusted to address any issues arising from the credit rating agencies’ operations within the IFSC.
- It will assume responsibility for complaints, enforcement actions, and communication with external statutory or judicial entities regarding the credit rating services offered in IFSC.
- Notably, the rating assessments conducted under IFSCA guidance will be under the exclusive jurisdiction of the authority itself.
Expanding Horizons: ESG Rating Services Regulation
In a parallel development, Sebi’s regulatory framework now also encompasses ESG rating providers (ERPs). The circular includes IFSCA in the list of overseers for ERPs, allowing these providers to evaluate the sustainability practices of businesses within the international financial service hub of GIFT City. As with credit rating agencies, ESG ratings performed under IFSCA guidelines fall strictly under its jurisdiction.
Further Advancements: RBI Empowers Indian Residents
Complementing the expansion of financial services, the Reserve Bank of India has recently facilitated Indian residents to open foreign currency accounts in GIFT City. This move evidences the accelerated financial liberalization and the potential of GIFT City as a global financial nexus.
Conclusion: Estabizz’s Commitment to Global Financial Evolution
Sebi’s facilitation of credit rating agencies to operate in GIFT City is a testament to the progressive era of financial regulation and international collaboration. Estabizz Fintech Private Limited stands at the forefront of these innovations, equipping businesses with the insights and expertise needed to navigate and capitalize on this evolving financial terrain. The journey towards an empowered, transparent, and regulated financial ecosystem continues to gain momentum, delivering a promise of robust growth and enduring success for our clientele worldwide.
Estabizz Fintech compiled the material in this article using the most recent Acts, Rules, Circulars, Notifications, Provisions, Press Releases, and material applicable at the time. They ensured the completeness and correctness of the material through due diligence. When using this material, users must consult the relevant, applicable legislation. The given data may change without prior notice and does not constitute professional advice. Estabizz Fintech disclaims all liability for any results from the use of this material.
