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SEBI on May 18, 2024, published the amendments to the SEBI ICDR Regulations in the official gazette subsequent to the release of interim recommendations by the expert committee on 'Ease of Doing Busin...
The Securities and Exchange Board of India has introduced a new category of investors called Specific Investors ("SI") in the rights issue process. The SI route has the potential to be particularly useful for capital constrained companies, as they enable issuers to raise capital with flexibility historically available through the rights issue process and certainty in terms of pre-identified investors. For non-resident SIs, the process requires comprehensive interpretation and compliance with the securities laws and foreign exchange control laws. This new framework is a progressive step for India's capital markets landscape; however certain ambiguities need to be resolved to ensure its long-term effectiveness.
CMS INDUSLAW’s Kaushik Mukherjee, Anumeha Agrawal, and Satakshi N Dixit aim to highlight the critical interplay between the SEBI ICDR Regulations and the FEMA NDI Rules for non-resident SIs, particularly concerning valuation norms and the classification of investments as either FDI or FPI.
