The BSE has received the recognition certificate of ‘Designated Offshore Securities Market’ (DOSM) from the United States Securities and Exchange Commission (SEC).

This will help in the sale of securities to US investors through the BSE platform without registration of such securities with the US SEC and thus, will help US investors in India.

Till now, equity and bond securities traded on the BSE and issued in the US could not generally be resold in non-prearranged trades without fulfilling certain requirements. As such, effecting such transactions with US persons without any restrictions under the Securities Act was difficult.

Following the DOSM recognition, BSE-listed securities, originally issued in the US and exempt from SEC registration, may be freely resold on the BSE.

The recognition by the SEC speaks of the comparability of the international regulatory framework adopted by the BSE, governing structure, organisation and disclosure standards, the BSE said in a press release. “Companies listed on the BSE can feel confident of the exchange being a listing venue of choice and comparable with a handful of exchanges globally recognised for their standards by the SEC,” it added.

The BSE becomes the first bourse in India to receive the DOSM recognition and now joins an elite list of foreign exchanges.

IDRs to become attractive

The recognition will also enhance the attractiveness of Indian Depository Receipts among US investors. The BSE’s new status will provide additional benefits to companies whose securities are traded both in the US and on the BSE. “Certain directors and officers of dual-listed companies will be permitted to resell their securities on the BSE, regardless of any restrictions or holding periods that may apply under the US securities laws,” BSE statement said.

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