Permission for Shortselling of Equity Shares by SEBI registered FIIs

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....ed Dealer Category-I (AD Category - I) banks is invited to A.P.(DIR Series) Circular No.53 dated December 17, 2003 wherein SEBI registered FIIs/sub-accounts of FIIs were permitted to buy/sell equity shares/debentures of Indian companies. In terms of para 5 of the Annex to the circular, FIIs are not allowed to engage in short selling and are required to take delivery of securities purchased and giv....

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....an list and /or caution list of Reserve Bank. (ii) Borrowing of equity shares by FIIs shall only be for the purpose of delivery into short sale. (iii) The margin/collateral shall be maintained by FIIs only in the form of cash. No interest shall be paid to the FII on such margin/collateral. 4. The designated custodian banks shall separately report all transactions pertaining to short selling o....