Friday June 8 2012
News Source: Global Disclosures
Focus: Foreign Investment
Type: General
Country: India
On a review and in consultation with the Government of India (GoI) and RBI, it has been decided to revise the definition of India QFI in equity shares and mutual fund schemes as under:
QFI shall mean a person who fulfils the following criteria:
- Resident in a country that is a member of Financial Action Task Force (FATF) or a member of a group which is a member of FATF; and
- Resident in a country that is a signatory to IOSCO’s MMOU or a signatory of a bilateral MOU with SEBI:
It has been decided to allow QFIs to make fresh purchases of eligible securities, out of the sale/ redemption/ dividend proceeds of any of the eligible securities. Further, it is clarified that all the eligible securities shall be held in a single demat account of the QFI. Eligible securities shall mean mutual fund units (under both direct and indirect route), equity shares, corporate debt and any other security which is permitted for investment by QFI from time to time by GoI, RBI and SEBI.
It has been further decided to extend the option of appointment of custodian of securities by the QFI. The QFI, if it so desires, may appoint a custodian of securities, who would be obligated to perform clearing and settlement of securities on behalf of the QFI client. However, no person shall be appointed as custodian by the QFI unless it is itself the qualified DP of the QFI and is also registered as custodian with SEBI under SEBI (Custodian of Securities) Regulations, 1996.
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