Custodians flag concerns to Sebi on monitoring foreign holdings in DRs

Confidentiality, difficulty in differentiating an account as client or non-client are some of the issues raised

A clutch of custodians have written to the Securities and Exchange Board of India (Sebi) highlighting the difficulties associated with complying with the diktat on monitoring foreign holding in depository receipts.

The circular requires designated depository participants or custodians to collect, monitor and report information every month on offshore derivatives instruments (ODIs) and depository receipts (DRs) held by foreign portfolio investors (FPIs) and those foreign entities which belong to the investor group of the FPIs. The report is required to be submitted to the depository on the 17th of every month.

Currently, ODIs are reported to Sebi directly by ODI