CORPORATE BOND MARKET – LAUNCH OF TRADING PLATFORM

The order driven trade matching platform for listed corporate debt securities shall be implemented by BSE and NSE with effect from July 01, 2007 on the following lines:

• BSE and NSE may make use of the existing infrastructure available with them for operating the trade matching platform for corporate bonds, with necessary modifications. 
• In the initial stage of usage of the trade matching platforms, the system shall retain the essential features of the Over The Counter (OTC) market.
• Orders executed through trading platforms of either BSE or NSE shall not be required to be reported again on the reporting platforms. 
• All investors, including banks, who are desirous of using the trading platform of BSE or NSE, shall deal through stock brokers registered with SEBI for their transactions thereon. Respective regulators accordingly have been requested to issue necessary instructions to all entities regulated by them. 
• At the option of the participants, they will also be allowed to undertake OTC transactions. Such transactions shall continue to be reported on the reporting platforms. 
• The trading platforms shall be available from 10.00 am to 5.30 pm on all trading days. BSE and NSE shall ensure that the norms on trading hours, access rights to the trading systems etc. shall broadly follow the norms presently followed in the equity segment. BSE and NSE shall ensure that the norms are harmonious between the exchanges.
• The entities trading in listed corporate debt securities may settle their trades bilaterally between them. They may also use the services of the stock exchanges for clearing and settlement. 
• BSE and NSE shall ensure that the shut period in corporate bonds shall be reduced and aligned to that applicable for Government Securities within a reasonable period of time. 
• All entities, including Qualified Institutional Investors (QIBs), shall trade in corporate bonds subject to a minimum value of Rs.1 lakh. Exchanges may also have a limited segment for transactions in smaller market lots.