SEBI Extends Compliance Deadline for Debenture Trustees by Six Months Amid Operational Challenges:

SEBI Extends Compliance Deadline for Debenture Trustees by Six Months Amid Operational Challenges The Securities and Exchange Board of India (SEBI) has issued a Circular, dated April 28, 2026, announcing an extension to the time limit granted to Debenture Trustees (DTs) to comply with the terms and conditions for carrying out activities outside the purview of SEBI. Previously, on October 27, 2025, SEBI had introduced a new provision of Regulation 9C to the ambit of activities allowed for trustees under SEBI (Debenture Trustees) Regulations, 1993. The new provision has clarified that debenture trustees who possess a valid certificate of registration must separate their non-SEBI-regulated activities into different business units.

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Originally, the trustees were granted a time limit of six months to complete this transition. Subsequently, on November 25, 2025, SEBI issued another circular mentioning the framework, conditions, and operational requirements for these activities in detail. However, it was noted that several industry participants were facing difficulties in establishing the required systems and processes within the given time at that point. In order to address those challenges, the SEBI has issued the present circular to further extend this compliance time limit by another six months. Debenture trustees now have time till October 27, 2026, to meet the prescribed requirements.

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The official circular reads, "Based on representations received from the industry highlighting operational challenges in establishing the necessary systems and processes for effective implementation, it has been decided to grant an additional six months for compliance by the DTs. Accordingly, the provisions of the aforesaid amendment and circular shall be implemented by Debenture Trustees by October 27, 2026." The SEBI also clarified that all the other rules and conditions specified in the earlier circular remain unchanged. This action has been taken to ensure smooth implementation while also protecting investors’ interests and maintaining proper regulation of the securities market.