A Company Cannot Issue Equity Shares Against Export Advance Under SEBI (ICDR) Norms | SEBI Clarifies
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- By Chetan Kulasri
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- Last Updated on 15 February, 2025
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Informal Guidance No. CFD/PoD/OW/4775/1, Dated: 12.02.2025
A company that entered into an export supply agreement with its subsidiary, sought informal guidance from SEBI on whether issuing equity shares against export advance is allowed under SEBI (ICDR) norms. SEBI clarified that Reg. 163(3) is specific to preferential issue of shares for ‘consideration other than cash’ only in cases of share swaps. Therefore, a company cannot issue equity shares against export advances, as it is an outstanding liability.
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