Companies Act Section 390 — Offer of Indian Depository Receipts

CHAPTER XXII COMPANIES INCORPORATED OUTSIDE INDIA

Commercial / Corporate

Summary

This section gives the Central Government the power to create rules about Indian Depository Receipts (IDRs), and this power applies even if other laws say something different.

Under clause (a), the rules can cover how IDRs are offered to investors.

Under clause (b), the rules can cover what information must be disclosed in the prospectus or letter of offer that is issued when IDRs are involved.

Under clause (c), the rules can cover how IDRs are handled in a depository mode, including the roles of custodians and underwriters.

Under clause (d), the rules can cover how IDRs are sold, transferred, or transmitted by a company that is incorporated outside India, regardless of whether that company has set up, or will set up, any place of business in India.

Official Text

Notwithstanding anything contained in any other law for the time being in force, the Central Government may make rules applicable for—

(a) the offer of Indian Depository Receipts;

(b) the requirement of disclosures in prospectus or letter of offer issued in connection with Indian Depository Receipts;

(c) the manner in which the Indian Depository Receipts shall be dealt with in a depository mode and by custodian and underwriters; and

(d) the manner of sale, transfer or transmission of Indian Depository Receipts, by a company incorporated or to be incorporated outside India, whether the company has or has not established, or will or will not establish, any place of business in India.