Regulatory Alerts2018-09-19
Illustrations to the Seasoned Corporate Bonds and Sukuk Framework
The Securities Commission Malaysia outlines the procedural timeline and reporting obligations for eligible distributors of seasoned corporate bonds and sukuk. Distributors must submit an initial notification and fee at least two business days before distribution commences, followed by quarterly reporting on additional issuances and payments within seven days of each quarter's end. The framework also mandates a cessation notice submitted seven business days prior to stopping distribution activities, with annual fees capped at RM10,000 for additional tranches.
Illustration 2: Payment Process Illustration 1: Notification to commence distribution of seasoned bonds or sukuk and cessation of activity Tx + end of Q1 Tx + end of Q2 T+2 Tx Effective date of commencement of distribution No additional payment necessary between T0 and Tx for any notification on additional seasoned corporate bonds or sukuk Notification of any additional seasoned corporate bonds or sukuk distributed 12 months (Year 1) T0 End of first year of distribution 2 days Submit Initial Notification Accompanied by payment of RM10,000 Submit Cessation Notice T-7 T0 Effective cessation date T+2 TY Distribution activities may commence two business days after T0 Distribution Period Submit Initial Notification (Appendix 1) on SC’s reporting platform at least two business days prior to T+2 TZ
- Submit the following documents on the SC’s reporting platform within 7 business days after the end of every quarter:
- Quarterly reporting (Appendix 3).
- Post-distribution notification of any additional seasoned corporate bonds or sukuk (Appendix 2), if applicable.
- Declaration by Eligible Distributor (Quarterly Reporting) (only in 4th quarter reporting) (Appendix 3). ** Notification on non-eligibility of seasoned corporate bonds or sukuk (Appendix 4) Email SC interest to distribute 2 days (min) 7 days (min) 7 days (min) To email interest to distribute at least 7 business days prior to T0 Email: seasonedbonds@seccom. com.my Submit Initial Notification Effective date of commencement of distribution Effective cessation date as determined and declared by distributor • Submit Cessation Notice (Appendix 5) at least seven business days before intending to stop distribution activity Notification of additional seasoned corporate bonds or sukuk distributed after Tx Notification (if any) to be submitted on a quarterly basis. Payment of RM1,000 for each additional seasoned corporate bonds or sukuk / tranche distributed after Tx. Payment capped at RM10,000 annually, regardless of the number seasoned corporate bonds or sukuk / tranche distributed.
02/01/2019 T X Commencement of distribution 16/12/2019 T Y Submission of Cessation Notice Q1* reporting 09/04/2019
- Quarterly reporting:
- Quarterly reporting for distribution of seasoned corporate bonds or sukuk (Appendix 3).
- Post-distribution notification of any additional seasoned corporate bonds or sukuk (where applicable) (Appendix 2), including payment of applicable fees.
- Declaration by Eligible Distributor (Quarterly Reporting) (only in 4th quarter reporting) (Appendix 3). ** Q4 reporting shall consist of transactions executed up until effective cessation date. *** Notification on non-eligibility of seasoned corporate bonds or sukuk (Appendix 4). Distribution Period Illustration 3: Quarterly Reporting and Notification Requirements (Example) 31/03/2019 End Q 1 30/06/2019 End Q 2 30/09/2019 End Q 3 26/12/2019 T Z Effective cessation date Within 7 days Within 7 days Within 7 days Within 7 days Q2* reporting 09/07/2019 Q3* reporting 09/10/2019 Q4** reporting 10/01/2020
- ‘days’ refers to business days 31/12/2019 End Q4 7 days