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SEC amends regulations on approval of offer for sale of newly issued bonds of foreign entities



Tuesday 2 January 2024 | No. 2 / 2024


Bangkok, 2 January 2024 – The Securities and Exchange Commission (SEC) has amended the regulations on approval of offer for sale of newly issued bonds of foreign entities, effective from 1 January 2024. 

The amendments aim to enhance suitability for the risk profile of the foreign issuer and alignment with the changing contexts and landscape of the bond market. In this regard, five relevant notifications have been revised, containing the key amendments as follows:  

  (1) Allowing the foreign issuer to file an application for approval of offer for sale of bonds denominated in Thai baht (baht bonds) in Thailand with the SEC directly without the need to obtain a prior approval from the Ministry of Finance; 

(2) Requiring the foreign issuer of baht bonds to (i) obtain an issue rating not lower than investment grade* from an international credit rating agency established under foreign law (international CRA), (ii) appoint a bondholder representative, and (iii) register the baht bonds with the Thai Bond Market Association (ThaiBMA). In the case where the existing issuers intend to roll over the outstanding non-investment grade bonds**, the SEC will grant a temporary exemption of application filing to such issuers to mitigate potential adverse impacts on the issuer, investors, and the bond market confidence; 

(3) Aligning the criteria for issuance and offer for sale of foreign currency-denominated bonds (FX bonds) of foreign entities (issuers) in Thailand with the amendments to the baht bond offering regulations.

The notifications of the amended regulations*** have been published in the Government Gazette and have taken effect from 1 January 2024 onwards.  

________________________

Remarks: 

* The regulations on the compulsory issue rating by an international credit rating agency established under foreign law and the requirement of investment grade rating are not applicable to a private placement (PP10).   

** The existing issuers with the outstanding non-investment grade bonds as of 31 December 2023.  

*** The five relevant regulatory notifications are as follows:  

(1) Notification of the Capital Market Supervisory Board No. Tor Jor. 60/2566 Re: Application for Approval of Public Offering of Newly Issued Bonds (No. 5)  (https://publish.sec.or.th/nrs/10038s.pdf); 

(2) Notification of the Capital Market Supervisory Board No. Tor Jor. 61/2566 Re: Application for Approval of Private Placement of Newly Issued Bonds and Offer for Sale of Convertible Bonds to Persons with Specific Characteristics (No. 5) (https://publish.sec.or.th/nrs/10039s.pdf);  

(3) Notification of the Capital Market Supervisory Board No. Tor Jor. 62/2566 Re: Temporary Exemption of Credit Rating Criteria for Approval of Offer for Sale of Baht Bonds or Foreign Currency-Bonds in Thailand in Private Placement of Foreign Entity (https://publish.sec.or.th/nrs/10040s.pdf); 

(4) Notification of the Capital Market Supervisory Board No. Tor Jor. 63/2566 Re: Filing of the Registration Statement for Offer for Sale of Debt Securities (No. 2) (https://publish.sec.or.th/nrs/10041s.pdf);   

(5) Notification of the Office of the Securities and Exchange Commission No. Sor Jor. 35/2566 Re: Rules and Procedures for Preparation of Factsheets (No. 2) (https://publish.sec.or.th/nrs/10043s.pdf). 





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Building Confidence in the Capital Market
NEWS
Securities and Exchange Commission
Corporate Communication and Investor Service Department
Tel. (66)2033-9502-5 E-mail: press@sec.or.th
No. 2 / 2024 Tuesday 2 January 2024
SEC amends regulations on approval of offer for sale of newly issued bonds of foreign entities

Bangkok, 2 January 2024 – The Securities and Exchange Commission (SEC) has amended the regulations on approval of offer for sale of newly issued bonds of foreign entities, effective from 1 January 2024. 

The amendments aim to enhance suitability for the risk profile of the foreign issuer and alignment with the changing contexts and landscape of the bond market. In this regard, five relevant notifications have been revised, containing the key amendments as follows:  

  (1) Allowing the foreign issuer to file an application for approval of offer for sale of bonds denominated in Thai baht (baht bonds) in Thailand with the SEC directly without the need to obtain a prior approval from the Ministry of Finance; 

(2) Requiring the foreign issuer of baht bonds to (i) obtain an issue rating not lower than investment grade* from an international credit rating agency established under foreign law (international CRA), (ii) appoint a bondholder representative, and (iii) register the baht bonds with the Thai Bond Market Association (ThaiBMA). In the case where the existing issuers intend to roll over the outstanding non-investment grade bonds**, the SEC will grant a temporary exemption of application filing to such issuers to mitigate potential adverse impacts on the issuer, investors, and the bond market confidence; 

(3) Aligning the criteria for issuance and offer for sale of foreign currency-denominated bonds (FX bonds) of foreign entities (issuers) in Thailand with the amendments to the baht bond offering regulations.

The notifications of the amended regulations*** have been published in the Government Gazette and have taken effect from 1 January 2024 onwards.  

________________________

Remarks: 

* The regulations on the compulsory issue rating by an international credit rating agency established under foreign law and the requirement of investment grade rating are not applicable to a private placement (PP10).   

** The existing issuers with the outstanding non-investment grade bonds as of 31 December 2023.  

*** The five relevant regulatory notifications are as follows:  

(1) Notification of the Capital Market Supervisory Board No. Tor Jor. 60/2566 Re: Application for Approval of Public Offering of Newly Issued Bonds (No. 5)  (https://publish.sec.or.th/nrs/10038s.pdf); 

(2) Notification of the Capital Market Supervisory Board No. Tor Jor. 61/2566 Re: Application for Approval of Private Placement of Newly Issued Bonds and Offer for Sale of Convertible Bonds to Persons with Specific Characteristics (No. 5) (https://publish.sec.or.th/nrs/10039s.pdf);  

(3) Notification of the Capital Market Supervisory Board No. Tor Jor. 62/2566 Re: Temporary Exemption of Credit Rating Criteria for Approval of Offer for Sale of Baht Bonds or Foreign Currency-Bonds in Thailand in Private Placement of Foreign Entity (https://publish.sec.or.th/nrs/10040s.pdf); 

(4) Notification of the Capital Market Supervisory Board No. Tor Jor. 63/2566 Re: Filing of the Registration Statement for Offer for Sale of Debt Securities (No. 2) (https://publish.sec.or.th/nrs/10041s.pdf);   

(5) Notification of the Office of the Securities and Exchange Commission No. Sor Jor. 35/2566 Re: Rules and Procedures for Preparation of Factsheets (No. 2) (https://publish.sec.or.th/nrs/10043s.pdf).