RBI Amends Forex Regulations: SEBI-Approved Clearing Corporations Can Open Demat Accounts with Foreign Depositories Under Regulation 27.

The Reserve Bank of India has amended the Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations, 2004, effective retroactively from July 19, 2007. The amendment introduces Regulation 27, allowing SEBI-approved clearing corporations and their members to open and maintain demat accounts with foreign depositories. They can acquire, hold, pledge, transfer foreign sovereign securities offered as collateral by FIIs, remit proceeds from corporate actions, and liquidate these securities, repatriating proceeds to India. The amendment clarifies that no person will be adversely affected by its retrospective application.

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