Leading stock exchange BSE today said the US securities regulator has recognise it as 'designated offshore securities market', a move that will ease trade by US investors in India.
BSE has become the first stock exchange in the country to receive such recognition.
The 'designated offshore securities market' (DOSM) status allows sale of securities to US investors through BSE trading platform without registration of such securities with the US Securities and Exchange Commission (SEC). This way it eases the trades by US investors in India, the bourse said in a statement.
Previously, equity and bond securities listed and traded on BSE and issued in the US, could not generally be resold in non-prearranged trades executed through the facilities of BSE's trading platform, without requiring that the seller forms a reasonable belief that the buyer is outside the US.
Such transactions with US persons without any restrictions under the Securities Act was problematic.
The move is expected to primarily benefit securities issued in US private placements to institutional investors. Further, it will also enhance the attractiveness of Indian Depository Receipts (IDRs) amongst US investors.
The new status will provide additional benefits to the companies whose securities are traded both in the US and on BSE.
Besides, certain directors and officers of dual-listed companies will be permitted to resell their securities on BSE, regardless of any restrictions or holding periods that may apply under US securities laws.
"This is an important recognition of our endeavours not only to be the most modern platform technologically, but to also provide a globally recognised, well-regulated and well-governed venue for global investors who are looking at India with even more interest," BSE MD and CEO Ashishkumar Chauhan said.
"With this status, we will continue our growth of listings and also aim to become an even better place to enable investments into India by US investors," he added.
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