Author: Contributor
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A Progress Report on SEBI’s Recent Initiatives
LiveMint carries a report analyzing SEBI’s progress under its new chairman, Mr. C. B. Bhave, who completes 100 days in office. While several initiatives have been taken in the primary and secondary markets, there seems to be a lot to be done as far as legal and investigation matters are concerned. The report states that…
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Enabling SMEs Access the Capital Markets
Although the small and medium enterprises (SMEs) constitute a significant portion of India’s economy, they face several hurdles in accessing capital in a cost-effective manner. As far the capital markets are concerned, the SEBI (Disclosure and Investor Protection) Guidelines, 2000 provide several eligibility criteria for companies to qualify for being able to initiate public offerings.…
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Participatory Notes and Disclosure Requirements
In an earlier post, we had discussed the decision of the Securities Appellate Tribunal (SAT) setting aside a SEBI order that imposed a penalty of Rs. 1 crore on an FII for giving a false declaration regarding its issuance of participatory notes. Our guest contributor, Somasekhar Sundaresan, has written a column in The Business Standard…
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Financial Disclosures by Companies
A column by Rahul Roy in The Business Standard deals with the proposed revision and simplification of Schedule VI to the Companies Act. This schedule prescribes the presentation and disclosure requirements for financial statements. The column strenuously argues that the current version of Schedule VI is severely outdated and as to how it should be…
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Foreign Currency Borrowings: FCEBs and ECB
In an earlier post, we had analysed the notification of the Government of India permitting the issuance of Foreign Currency Exchangeable Bonds (FCEBs). The Reserve Bank of India (RBI) was expected to prescribe detailed guidelines on the mechanism for the issuance of FCEBs. It is now reported in LiveMint that the detailed guidelies would be…
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Bharti-MTN: Structural Problems
The proposed deal between Bharti and MTN to combine their businesses fell through over the weekend. Although the principal reason for the fallout appears to be disagreement over who would control the combined entity, that was aided by problems with structuring the deal from a regulatory perspective. As The Economic Times reports: “In addition, there…
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A Possible IDR Debut in the Indian Markets
A few months ago, we had lamented about the lack of even a single issuance of IDRs by foreign companies in the Indian markets; this, despite the relaxation of rules in 2007 to facilitate IDR listings. We had said: “Indian Depository Receipts (IDRs) are instruments that enable foreign companies to access the Indian capital markets.…
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Role of Rating Agencies
Credit rating agencies have come under fire on account of their role in the recent global financial crisis arising out of the repackaging of subprime mortgage debts. This has resulted in a call for tighter regulation of rating agencies. But, this revelation in Financial Times is startling: “Moody’s awarded incorrect triple-A ratings to billions of…
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Taxation on Sale of Shares in a Foreign Holding Company
Often, divestments by foreign owners of Indian companies are effected through a sale of the stake outside India. More specifically, where foreign companies hold shares in Indian companies through intermediate offshore investment companies, they can effect a divestment by merely selling off shares of the offshore holding companies. This does not in any way result…
