The market regulator revoked its earlier wind-up order against Brickwork Ratings (BWR) and passed several directions to the rating major.

The move follows the Securities Appellate Tribunal’s directive to relook at its earlier order cancelling the licence of BWR licence as a credit rating agency. “While affirming some of the violations, the tribunal remitted the matter to SEBI to issue a fresh order on the quantum of penalty.”

In a fresh order, SEBI asked the Brickwork Ratings, which said it should not onboard new clients for six months and must broad-base its Board members to nine. It should also ensure that only an independent director not related/connected to the founding management of the Notice is appointed as the Chairperson of its board.

“The Noticee (Brickwork Ratings) shall ensure that the person functioning as CRO has adequate experience in credit rating and risk management… and such

person shall also ensure that systems and rating models are in place,” it added.

Besides, the CEO should be an independent professional and persons undertaking rating exercise should be adequately trained, the order further said.

In its order dated October 6, 2022, SEBI cancelled the licence of Brickwork and directed the credit rating agency to wind down operations within six months for alleged violations in the rating process, due diligence, reporting of conflict of interest, and correct disclosures.