Mumbai: The Union Cabinet on Wednesday okayed a proposal to allow listing of Indian companies in overseas markets for which an enabling provision would be made under the Companies Act, 2013.
Corporate Affairs Secretary Injeti Srinivas said the Act would have an enabling provision for listed as well as unlisted companies in India to list their shares abroad.
"Now, just like you had a scheme for GDR/ADR, what will be the tax treatment and other issues? Most of it (will) get covered in subordinate legislation.
It does not involve any amendment per se to the best of my understanding," Srinivas said at a briefing where Finance Minister Nirmala Sitharaman was also present.
Union Minister Prakash Javadekar had announced that a proposal for allowing listing of Indian companies abroad has been approved. In order to tap foreign investors, some 1Indian firms have taken the ADR/GDR routes.
Official sources said apart from helping these companies raise additional funds, overseas listing of shares would also help in bringing more capital into the country, and raise their brand visibility.
The main beneficiary of the enabling provisions of the foreign listing of firms will be the unlisted firms and start-ups. This will also help companies who want to list abroad first and then list in India.
The details regarding market jurisdiction, class of companies and instruments of raising will be notified in the rules.
The RBI, the SEBI, Department of Economic Affairs and Ministry of Corporate Affairs will work out the listings.