Wednesday June 26 2013

News Source: Global Disclosures

Focus: Foreign Investment

Type: General

Country: India




Further to the update of 13th June 2013 in relation to India foreign investment rules, the Securities and Exchange Board of India have approved measures extending from the report of the Committee on Rationalisation of Investment Routes and Monitoring of Foreign Portfolio Investments. Changes approved at the SEBI Board meeting include:

  • Merging different classes of investors such as FIIs, their Sub Accounts and Qualified Foreign Investors (QFIs) into a new category, Foreign Portfolio Investors (FPIs). This will simplify entry norms and enhance uniformity.
  • FIIs and their sub accounts will no longer have to directly register with the regulator in order to operate on the market. Instead, DDPs authorized by SEBI would register Foreign Portfolio Investors on behalf of SEBI subject to compliance with risk-based KYC (Know Your Client) requirements.
  • Any portfolio investments would be defined as investment by any single investor or investor group and shall not exceed 10 per cent of the equity of an Indian company. Any investment beyond the threshold of 10 per cent shall be considered as Foreign Direct Investment (FDI).

The Board decided that the recommendations concerning SEBI would be implemented by SEBI and it would refer the other recommendations to Government of India for implementation.

Please click on the above link for SEBI Board Meeting Press Release.