Why is SEBI proposing this?
While the Depository Receipts Scheme, 2014 and the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019 already permit the issuance of DRs against eligible securities, including REIT and InvIT units, SEBI’s REIT and InvIT Regulations currently do not contain an enabling provision or operational framework for such issuances. The proposal seeks to bridge this regulatory gap by introducing a formal framework.
What are Depository Receipts?
Depository Receipts are foreign currency-denominated instruments issued by a foreign depository against Indian securities held with a domestic custodian.Also read: Markets recover from day’s lows, but FMCG drag keeps indices lower
How will the proposal benefit?
The framework is expected to create an additional investment avenue for foreign investors by allowing them to trade REIT and InvIT exposure in foreign currency on permitted international exchanges. SEBI believes this could help attract greater foreign capital into Indian REITs and publicly listed InvITs.
Scope of the proposal
The proposed framework will apply to REITs and publicly listed InvITs. Privately listed InvITs have been excluded because they have a minimum trading lot of ₹25 lakh and are initially offered only to institutional investors and body corporates. SEBI said these restrictions cannot be effectively enforced once DRs are issued and traded overseas.
Consultation
SEBI has sought public comments on whether DRs should be permitted for REITs and publicly listed InvITs, and whether stakeholders agree with the proposed framework for such issuances.
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Timeline
The last date to submit public comments is August 25, 2026.
