The Union Budget 2023-24 has recognised offshore derivative instrument (ODI) as a valid contract, though this is limited to an ODI issued by a Foreign Portfolio Investor (FPI) in the International Financial Services Centre (IFSC) as regulated by the International Financial Services Centre Authority (IFSCA). This is done to enhance business activities in the IFSC.
As this is a limited recognition, in general, derivative contracts, unless the ones which meet conditions of the Securities Contracts (Regulation) Act, 1956 (SCRA), will continue to be void.
Please click here to read the full article by Lalit Kumar, published in Mint Genie.
Lalit is a corporate commercial, M&A and private equity lawyer with a vast experience of twenty-two years. He has successfully led large and complex transactions for Indian and global corporations.