Securities and Exchange Board of India (“SEBI”) has, vide a circular dated June 29, 2010 (“New Circular”), modified the reporting obligations of the Foreign Institutional Investors (“FIIs”) in respect of the securities lent abroad by FIIs. It is pertinent to note that SEBI had, in a circular dated October 16, 2008 mandated the Foreign Institutional Investors (“FII”) to submit information about the quantity of the securities which they have lent to entities abroad i.e. to entities other than in the Indian securities market. Based on the information submitted by the FIIs, SEBI has been making available such information on its website twice a week.
The New Circular requires FIIs to submit the required information on a weekly basis (every Friday) as against on a daily basis. Accordingly, SEBI’s obligation to publicly disseminate the information on its website has been changed from twice a week to once a week (every Thursday).
The weekly reporting requirement of FIIs will be effective from July 02, 2010, the first such weekly report shall be submitted by July 09, 2010. Similarly, the first weekly public dissemination on the SEBI’s website shall be made on July 13, 2010.
In addition to the above, FIIs issuing participatory notes would be required to submit the following undertaking along with their weekly report:
“Any fresh short position shall be immediately reported to SEBI”
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