Reserve Bank Commercial Paper Directions 2017
Whereas the Reserve Bank of India, in exercise of the powers conferred by Sections 45J, 45K, 45L of the Reserve Bank of India Act, 1934, and of all the powers enabling it in this behalf, notified the Non-Banking Companies (Acceptance of Deposits through Commercial Paper) Directions 1989 vide Notification No.IECD.1/87(CP)-89/90 dated December 11, 1989;
And whereas the said directions having been amended from time to time vide Notification No.IECD.14/08.15.01/96-97 dated September 6, 1996; Notification No.IECD.21/08.15.01/97-98 dated June 17, 1998, Notification No IECD 3/08.15.01/2000-2001 dated October 10, 2000 and IDMD.PCD. 1284 /14.01.02/2012-13 dated October 16, 2012 respectively;
And whereas Section 45W of the Reserve Bank of India Act provides that the Bank may, in public interest, or to regulate the financial system of the country to its advantage, determine the policy relating to interest rates or interest rate products and give directions in that behalf to all agencies or any of them, dealing in securities, money market instruments, foreign exchange, derivatives, or other instruments of like nature as the Bank may specify from time to time;
And whereas Commercial Paper is a ''money market instrument'' for the purposes of Section 45W of the Reserve Bank of India Act;
Now therefore, in exercise of the powers conferred under sections 45J, 45K, 45L and 45W, and in supercession of the Notifications referred hereinabove, and all other instructions issued in this behalf, on the subject, the Reserve Bank of India, having considered it necessary in the public interest and being satisfied that for the purpose of enabling the Bank to regulate the credit and financial system to the advantage of the country, hereby issues the following directions:
1. Short Title and Commencement
These directions shall be called the Reserve Bank Commercial Paper Directions 2017 and shall come into force on the date of their publication.
2. Definitions
For the purpose of these directions, unless the context otherwise requires:
a. ''All India Financial Institution'' (AIFI) means an all India Financial Institution specified in the RBI Master Direction DBR.FID.No.108/01.02.000/2015-16 and as amended from time to time.
b. Banks'' means a banking company as defined in clause (c) of Section 5 of the Banking Regulation Act, 1949 (10 of 1949) or a "corresponding new bank", "State Bank of India" or a "subsidiary bank" as defined in clause (da), clause (nc) and clause (nd) respectively thereof and includes a "cooperative bank" as defined in clause (cci) of Section 5 read with Section 56 of the said Act.
c. ''Commercial Paper'' (CP) is an unsecured money market instrument issued in the form of a promissory note. The original tenor of a CP lies between seven days to one year.
d. ''Company'' means a company as defined in section 2 (20) of the Companies Act, 2013.
e. ''Issuing and Paying Agent (IPA)'' means a Scheduled Bank acting as an IPA.
f. ''RBI'' means the Reserve Bank of India.
g. ''Related parties'' shall be as defined in...
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