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TMI BlogStatus of a holder of Global Depository Receipts (GDRs) – Clarification regardingX X X X Extracts X X X X X X X X Extracts X X X X ..... lobal Depository Receipts (GDRs) - Clarification regarding Sir, A question has arisen whether a non-resident holder of Global Depository Receipts is a member of the issuing company within the meaning of section 41 and 42 of the Companies Act, 1956. 2. 'Global Depository Receipts' (GDRs) has been defined under the Issues of Foreign Currency Convertible Bonds and Ordinary Shares (Through Deposito ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epository Receipt or Certificate to non-resident investors against the shares or bonds held by the Domestic Custodian Bank. (iii) A non-resident holder of Global Depository Receipts may transfer those receipts, or may ask the Overseas Depository Bank to redeem those receipts. In the case of redemption, Overseas Depository Bank shall request the Domestic Custodian Bank to get the corresponding un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ange Board of India Act, 1992. 5. Accordingly, it is hereby clarified that (a) As per section 41(1) & (2) of the Companies Act, a person is a member of the company, (i) who is a subscriber to the Memorandum or (ii) whose name has been entered in the register of members. Since holder of Global Depository Receipts is neither the subscriber to the Memorandum nor a holder of the shares, his nam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the "Scheme"/provisions of the Companies Act, 1956. (d) Since the underlying shares are allotted in the name of Overseas Depository Bank, the name of such Overseas Depository Bank is to be entered in the Register of Members of the issuing company. However, until transfer/redemption of such GDRs into underlying shares, Overseas Depository Bank cannot be considered a nominee of the holder of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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