Firms can list GDRs in Gujarat's IFSC, MCA notifies rules

The MCA has notified the companies (issue of Global Depository Receipts) Rules, 2014, permitting listing of Global Depository Receipts (GDRs) at Gujarat International Finance Tec-City (GIFT).

The Ministry of Corporate Affairs (MCA) has notified the Companies (Issue of Global Depository Receipts) Rules, 2020 wherein new proviso in rule 7 has been inserted which states that the proceeds of issue of depository receipts may be remitted in an IFSC banking unit and utilized in accordance with the instructions issued by the EBI on time to time.

"The depository receipts can be issued by way of public offering or private placement or in any other manner prevalent in the concerned jurisdiction and may be listed or traded on the listing or trading platform in the concerned jurisdiction," the ministry said in the amended rules.

The depository receipts can be issued by way of public offering or private placement or in any other manner prevalent abroad and may be listed or traded in an overseas listing or trading platform.

As per the changed rules, proceeds from a GDR issue can be remitted in an International Financial Services Centre Banking Unit (IBU).

An IFSC enables an entity to bring back to India the financial services and transactions that are currently carried out in offshore financial centers by Indian corporate entities and overseas branches or subsidiaries of financial institutions.