FPIs to Receive Sale Proceeds on T+1 With Streamlined Tax Certificate Issuance

PR No. 26/2024; Dated: 16.10.2024

SEBI has introduced measures to speed up the availability of sale proceeds for foreign portfolio investors (FPIs), bringing them to par with domestic institutional investors. This move enhances operational efficiency and responds to concerns raised by FPIs.

FPIs previously reported delays in their access to sale proceeds beyond the standard ‘T+1’ settlement date. These delays were primarily due to the erstwhile process adopted to obtain tax clearance on their net sale proceeds to ensure compliance with FEMA Regulations.

Under the new system, effective from September 9, 2024, tax certificates for FPI sale trades executed on ‘T’ day are issued by tax consultants by 9:00 AM IST on the ‘T+1’ day. This allows FPIs to access sale proceeds, either for repatriation or for reinvestment, on the same T+1 day. It is broadly estimated that efficiency gains on account of these revised processes would be around Rs 2000 crore p.a.

Click Here To Read The Full Press Release