IRAN: New Iran foreign Investment By-Law

Monday April 26 2010

The Tehran Stock Exchange has announced a new by-law on Iran foreign investment, according to which foreign individuals and entities will now be able to take part in securities exchanges and OTC markets trading upon obtaining a licence from the Securities and Exchange Organisation. The bylaw distinguishes between strategic and non-strategic investors. Each foreign individual or entity will be allowed to acquire up to 10% of a listed issuer`s equities, as a non-strategic investor. Applicants may also submit applications for more than 10%, and as a result will be considered strategic investors. Non-strategic foreign investors will face no impediments for selling their acquired shares in the market. However, for strategic foreign investors, the repatriation period of capital will be two years from the buying date. The by-law also imposes a 20% cap on foreign investment in listed companies.

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