REAL ESTATE INVESTMENT FUNDS ALLOWED IN INDIA
SEBI in India has allowed domestic asset managers to launch funds
investing directly in real estate. As per SEBI, these funds shall be
close-ended with units listed on stock exchanges, and the net asset
values of the funds must be made public every day.
Such real estate investment funds should invest at least 35 percent
of their funds directly in real estate assets and the rest in
mortgage-backed securities and instruments of firms engaged in the
sector. They can invest up to 25 percent of their corpus in other
securities, according to the statement. "Taken together, investments in
real estate assets, real estate-related securities... shall not be less
than 75 percent of the net assets of the scheme," SEBI said. The asset
managers should get the assets valued every 90 days.
Funds in India
IT COMPANIES MOVING TO SMALLER CITIES IN INDIA
Indian IT companies are relocating to smaller cities, as
the unabated rise of the rupee against the US dollar continues to eat
away at their profits. More and more IT companies are relocating to
tier-II and tier-III cities such as Chandigarh, Lucknow, Kochi, Varanasi,
Mohali, Jamshedpur, Allahabad, Dehradun and Mysore to lower operational
costs by about 15 per cent.
The trend is particularly noticeable among BPO units
based in Gurgaon, Bangalore, Hyderabad, Delhi, Noida, Chennai and
Kolkata according to a recent report.
SEBI TAKES ACTION AGAINST COMPANIES FOR NONE-COMPLIANCE
Indian market regulator Securities and Exchange Board of
India (SEBI) initiated proceedings against 20 listed companies,
including five public sector entities, for violating corporate
The regulator has started adjudication proceedings
against the companies on the basis of quarterly reports received from
stock exchanges regarding compliance with Clause 49 of the Listing
Agreement that deals with corporate governance, a SEBI release said.
SEBI began proceedings against the five public sector companies for not
appointing adequate number of independent directors on their board.
As per the Clause 49, at least one-third of the board of
a listed company should comprise of independent directors if the
chairman is a non-executive director. Otherwise, half of the board
should comprise of independent directors. As far as private sector firms
are concerned, proceedings have been initiated against three companies
Exchanges Opened to Foreign Investment
The Indian government on opened up the country's stock
exchanges for foreign investment, with a cap of 49 per cent.
IRDA to permit insurance company to set up of liaison
offices in India
The Insurance Regulatory and Development Authority
(IRDA) has been authorized to permit insurance companies registered
outside India to set up liaison offices in the country.
The existing procedure for grant of permission by RBI for opening of
an office by an insurance company registered outside India has been
revised in consultation with the Government of India and it has been
decided that hence forth such permission would be granted by IRDA.
In this context a “Liaison Office” would mean a place of business to
act as a channel of communication between the Principal place of
business or Head Office by whatever name called and entities in India
but which does not undertake any commercial/ trading/ industrial
activity, directly or indirectly, and maintains itself out of inward
remittances received from abroad through normal banking channel.
Persons desirous of opening liaison offices shall apply to the
Insurance Regulatory and Development Authority. The applicant company
shall be required to comply with the terms and conditions of the General
Permission granted by RBI under the Foreign Exchange Management Act,
1999 and any other law in force.
The permission for opening of liaison office in India by an insurance
company registered outside India are subject to the terms and conditions
as may be additionally stipulated by the Authority from time to time.
For more information please
India Tightens Data Protection Law
The Indian government this week approved
amendments to the Information Technology Act (2000) aimed at making life
more difficult for IT criminals. Under the new law, fines of over US$1
million can be imposed on companies and individuals who fail to stop
data theft and the leakage of personal information. The amendments also
aim to combat phishing (e-mail fraud), identity theft, video voyeurism
and other types of computer crime. The National Association of Software
and Service Companies (Nasscom) and leading IT companies are pleased
with the amendments. According to an expert "India continues to be
comparatively more secure. A research conducted in 2005 found that there
were more security breaches in the UK and the US than in India."
Some Foreign Multinational Corporations found in
violation of Foreign Exchange laws of India
Some US Multinational Corporation Doing Business in
India were among 11 multinational corporations, whose Indian operations
were found guilty of violating foreign exchange regulation by an
Appellate Tribunal in India.
In its ruling earlier last week, Appellate Tribunal for Foreign
Exchange also confirmed a penalty of Rs 361.20 million imposed by
Enforcement Directorate (ED) on them, official sources said.
Terming this as an important case for the Directorate of Enforcement,
they said violation by the Indian arms of the foreign companies related
to payment of salaries to their expatriate employees working here in
foreign currency. This was done without the permission of the Reserve
Bank of India.
India Cyber law require compliance by companies
The India Information Technology Act was passed six years ago.
However most of the companies are still unaware of the strict provisions of the
As a recent case of bazee.com showed - the CEO of the company was
held responsible for, and arrested, for explicit content put up for auction on
his portal - and are thus exposed to serious liabilities.
The cyber law mandates all companies to have an information
technology security policy. This documents the architecture of the network, the
roles and responsibility of employees, security parameters and authorization
required for data access, among other things. Other compliances that are
required include relate to retention and authentication of electronic records
and security of data.
Only a handful of companies have such a policy in place. It is
high time that companies comply with cyber laws. Ignorance of law is no excuse.
All the Indian companies and all foreign companies doing business
in India, either directly or indirectly, should comply with this law.
Contact us for setting up a cyber
laws compliance program