- August 22, 2018
- Posted by: Atty. James Biron
- Categories: Banking, Commercial, Legal News
The “Guidelines on the Issuance of Green Bonds Under the ASEAN Green Bonds Standards (GSB)” has been approved by the Securities and Exchange Commission (SEC) and the agency also provided the rules and procedures for the issuance of ASEAN Green Bonds in the Philippines.
ASEAN Green Bonds refers to bonds and sukuk which conform with the ASEAN GBS, where the proceeds will be solely applied to finance or refinance, in part or in full, new and/or existing eligible Green Projects which include renewable energy, energy efficiency, pollution prevention and control, environmentally sustainable management of living natural resources and land use, clean transportation, climate change adaptation and green buildings.
The ASEAN Capital Markets Forum (ACMF) announced that it will take a leadership in role in identifying green finance standards following the 25th meeting of the ACMF in Jakarta, Indonesia, that can be applied for the ASEAN region which in recognition of the importance of green finance, supporting sustainable growth in ASEAN and the increasing amount of global capital seeking green investments.
The ACMF, in this regard, developed the ASEAN GBS to facilitate ASEAN capital markets in tapping green finance. To be eligible to issue and ASEAN Green Bond, under the guidelines, issuers must be incorporated in any of the ASEAN country members. Non-ASEAN issuer may issue ASEAN Green Bonds, given the eligible Green Projects are located in ASEAN.
Quantified by the Issuer, all designated Green Projects must give clear environmental benefits, which will be assessed and, where feasible. Fossil fuel power generation projects are excluded from the ASEAN Green Bonds Standards.
For project evaluation and selection, issuers must establish the process prior to the issuance of the ASEAN Green Bonds and disclose the project evaluation and selection process to investors in the documentation for the issuance.
The Guidelines also include a provision on Applicability on Existing Green Bonds where in certain circumstances, and at the discretion of the SEC, outstanding bonds issued by Philippine-Based issuer and/or in instances where the proceeds were used in the Philippines, will be considered for eligibility under the ASEAN Green Bonds Standards.
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Image source: WSJ
