InvestorQ : Can you tell me about the exemption given by SEBI for depository receipt investments for NRIs?
diksha shah made post

Can you tell me about the exemption given by SEBI for depository receipt investments for NRIs?

Answer
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7 months ago
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The regulator SEBI has given certain specific relaxations to NRIs with respect to holding of depository receipts or DRs issued by companies listed in India. NRIs will now be permitted to hold DRs issued by companies under ESOS, bonus issues and rights issues. These include American DRs and also GDRs.

Just to take you back a little bit; in late 2019 SEBI had barred non resident Indians or NRIs from buying DRs issued by India-listed companies. WE need to understand that the basic restrictions still remain. NRIs still cannot subscribe to further issue of DRs or buy DRs from the secondary market. This has been clarified by the government and the RBI.

However, the new rules put a lot of onus on the company that has issued these depository receipts. It is incumbent on the listed company to identify such NRI holders issued DRs in terms of ESOS, bonus or rights issues. The onus of informing and keeping the SEBI updated on these levels will also dwell on the respective companies.

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