SEBI Proposes Depository Receipts at IFSC for REITs

SEBI Proposes IFSC-Based Depository Receipts

SEBI has proposed allowing Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) to issue depository receipts listed at the International Financial Services Centre (IFSC) in GIFT City. The move aims to deepen foreign participation and integrate Indian infrastructure funds into global capital markets.

The proposal permits both public and private InvITs to issue rupee or dollar-denominated receipts. NRIs and foreign investors will be allowed to subscribe without restrictions, subject to FEMA compliance. SEBI will apply modified disclosure norms consistent with IOSCO standards.

Safeguards include mandatory appointment of overseas depositories, independent custody arrangements, and adherence to international accounting standards. The regulatory framework will align with IFSCA (International Financial Services Centres Authority) requirements.

For legal practitioners, this opens opportunities in cross-border structuring and fundraising. Advising on issuance will now involve coordination between SEBI, IFSCA, and foreign regulators. Tax implications under Indian and treaty laws will be critical, particularly for distributions and capital gains.