FAX NO: 91 22 22829520
Circular No. IMD/CUST/9/2003
November 20 , 2003
All Foreign Institutional Investors and Custodians of Securities
Dear Sir / Madam,
Sub: Issuance of Offshore Derivative Instruments by Registered Foreign Institutional Investors (FII).
Vide our circular IMD/CUST/8/2003 dated August 08, 2003 , SEBI had directed all FIIs issuing offshore derivative/financial instruments against underlying Indian securities to report issuance / renewal / cancellation / redemption of the aforesaid instruments to SEBI as per the format prescribed in the said circular. The report had to be submitted every fortnight (i.e. for the periods from 1st day of the month to the 15th day of the same month and from 16th day of the month till the last day of the month). In terms of the said reporting, FIIs have also been submitting ‘Nil’ reports in the event of no transaction or nil outstanding position in offshore instruments against underlying Indian securities.
In partial modification of the said circular, it has now been decided that those FIIs who do not have any outstanding off-shore derivatives shall submit a statement of ‘Nil’ report once in a quarter instead of a fortnightly basis provided that they submit the following undertaking to SEBI:
“ We undertake that we shall submit reports of issuance / renewal / cancellation / redemption of offshore derivative/financial instruments against underlying Indian securities on a fortnightly basis as prescribed in Circular No. IMD/CUST/8/2003 dated August 08, 2003 as soon as we have issued/subscribed any such off-shore derivative instrument.”
After submission of the undertaking , FIIs having nil outstanding off-shore derivatives need not submit ‘Nil’ report for the remaining fortnights during the current quarter and the first quarterly ‘Nil’ report shall be submitted commencing from the quarter ended December 2003 . The quarterly ‘Nil’ reports shall also contain the aforesaid undertaking.
The ‘Nil’ report for each quarter shall be submitted within 3 working days from the closure of the quarter (i.e. for the purpose of reporting, ‘Nil’ reports may be submitted for the periods January to March, April to June , July to September and October to December).
It is clarified that all FIIs having outstanding off-shore derivatives or who issue / renew / cancel / redeem such off-shore derivatives shall continue to report on a fortnightly basis issuance / renewal / cancellation / redemption of the aforesaid instruments to SEBI as per the format prescribed in Circular No. IMD/CUST/8/2003 dated August 08, 2003 .
The aforesaid information should be submitted by email to email id: ODIreporting@sebi.gov.in .
These instructions are issued under Regulation 20A of SEBI (Foreign Institutional Investors) Regulations, 1995 and shall come in force with immediate effect.
A copy of the circular is available at the web page “Foreign Institutional Investors” on our website www.sebi.gov.in . The custodians are requested to bring the contents of this circular to the notice of their FII clients and submit the compliance confirmation in this regard by November 30 , 2003 .
CHIEF GENERAL MANAGER