Sebi proposed allowing REITs and InvITs to issue depository receipts in order to allow foreign investors to participate in units of Indian emerging investment instruments. The Securities and Exchange Board of India (Sebi) stated in a consultation paper that this will benefit foreign investors because depository receipts eliminate the need to trade directly with the Indian stock exchange. Real Estate Investment Trusts and Infrastructure Investment Trusts are Business Trusts that hold and operate revenue-generating real estate or infrastructure assets. REITs and InvITs raise funds by selling units to the general public. REITs and InvITs do not have multiple schemes or unit classes. The units are denominated in Indian rupees, and they must be listed on an Indian recognised stock exchange. “Permitting issuance of Depository Receipts against units of REITs and InvITs which are listed on a foreign stock exchange gives foreign investors an opportunity to participate in the units of Indian REITs and InvITs,” sebi said. The Securities and Exchange Board of India (sebi) has requested public feedback on the proposed regulatory framework until February 21. Sebi proposed that REITs and InvITs will be eligible to issue permissible securities for the issuance of depository receipts if such trusts, their directors, and selling unit holders are not barred from accessing the capital market by Sebi, and they are not a willful defaulter or fugitive economic offender. Under certain conditions, existing unit holders would be able to transfer permissible securities for the issuance of depository receipts. The listing of DRs on international bourses should adhere to the highest standards. REITs and InvITs should make certain that DRs are only issued with units as permissible securities. REITs and InvITs must file with Sebi and the recognised Indian stock exchange a copy of the initial document for DRs issued on the back of permissible securities. Furthermore, for record purposes, final documents for such initial issues should be filed with them. According to Sebi, REITs and InvITs must ensure that any public disclosures they make on international bourses comply with the requirements of the permissible jurisdiction where the DRs are listed. These disclosures must also be filed with a recognised bourse within 24 hours of the filing date. See also: Highways InvIT to be open on stock exchange Infrastructure financing to evolve with new initiatives