Investment by FIIs/NRIs in Exchange Traded Derivative Contracts(ETDCs) - FEMA - 013

Investment by FIIs/NRIs in Exchange Traded Derivative Contracts(ETDCs) Reserve Bank of India Exchange Control Department Central Office Mumbai - 400 001 A.P.(DIR Series) Circular No.13 September 1, 2003 To All Authorised Dealers in Foreign Exchange Madam/Sirs, Investment by FIIs/NRIs in Exchange Traded Derivative Contracts(ETDCs) Attention of Authorised Dealers is invited to Regulation 5 of Notification No. FEMA 20/2000-RB dated 3 rd May 2000 conveying permission for purchase of shares by certain persons resident outside India. 2. As part of the measures for further liberalisation, it has been decided that::- i. A registered Foreign Institutional Investor (FII) having valid approval under FERA, 1973 or under FEMA, 1999 may trade in all exchange traded derivative contracts approved by SEBI from time to time subject to the limits prescribed by SEBI. ii. A Non-Resident Indian (NRI) may invest in exchange traded derivative contracts approved by SEBI from time to time out of INR funds held in India on non-repatriable basis subject to the limits prescribed by SEBI. Such investments will however not be eligible for repatriation benefits. 3. The necessary amendment to the Foreign Exchange Management Act (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000 referred to above has been notified vide Notification No. FEMA 85/2003-RB dated 17 th January 2003. 4. Authorised Dealers may bring the contents of this circular to the notice of their constituents concerned. 5. The directions contained in this circular have been issued under Section 10(4) and Section 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999). Yours faithfully, Grace Koshie Chief General Manager