Indian Public Companies can now List directly on GIFT IFSC Exchanges: Finance Ministry Amends Securities Contracts Rules [Read Notification]

The Indian public companies can now list directly on GIFT IFSC exchange. The Finance Ministry has notified the amended Securities Contracts Regulation Rules ( SCRR ) to simplify the listing process on international exchanges within International Financial Service Centres.

The amended rules will be known as Securities Contracts (Regulation) Amendment Rules, 2024. It came into force on 28th August 2024. The revised framework includes the ‘Direct Listing of Equity Shares of Companies Incorporated in India on International Exchanges Scheme,’ under the Foreign Exchange Management (Non-Debt Instruments), 2019, and the Companies (Listing of Equity Shares in Permissible Jurisdictions) Rules, 2024.

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Together, these regulations provide a comprehensive structure for public Indian companies to issue and list their shares on permitted international stock exchanges at GIFT-IFSC.

Key changes include:

• Minimum Public Offer: Indian companies wishing to list exclusively on international exchanges within IFSCs must now offer and allot at least 10% of the post-issue capital to the public, as detailed in the offer document.
• Continuous Listing Requirements: The continuous listing requirement has been reduced to 10%, in accordance with Rules 19 (2)(b) and 19A of the SCRR.

These amendments lower the entry barriers for Indian start-ups and companies, particularly those in the technology and emerging sectors, facilitating easier access to global capital, stated the press release issued by the government.

Essential Training for Tax Professionals: Know Your Sections!

According to notification, in rule 19, in sub-rule (2), in clause (b), after the fourth proviso, the following explanation shall be inserted, namely: –

“Explanation. – For the purposes of this clause, the provisions of sub-clause (i) shall apply to, or in relation to, an applicant company desirous of getting its securities listed on a recognised stock exchange in an International Financial Service Centre, subject to the modification that the reference to “twenty-five per cent.” in that sub-clause shall be construed as reference to “ten per cent.”, irrespective of the post issue capital of such company and sub-clauses (ii), (iii) and (iv) shall not apply.”

And in rule 19A, after the explanation to sub-rule (6), the following explanation shall be inserted, namely: –

“Explanation. – For the purposes of this rule, the provisions of sub-rules (1) to (5) shall apply to, or in relation to, a company listed on a recognised stock exchange in an International Financial Service Centre, subject to the modification that references to “twenty-five per cent.” in those sub-rules shall be construed as references to “ten per cent.” and the first proviso to sub-rule (5) shall not apply to such company.”.

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