SEBI has vide its circular dated 14th May, 2021 given relaxation to Real Estate Investment Trusts (REITs) and Infrastructure Investment Trust (InvITs) allowing them to file their regulatory filings by giving them one month more for the same. Gist of the circular enclosed.
SEBI is in receipt of representations from InvITs and REITs requesting extension of timelines for various regulatory filings and compliances for InvITs and REITs for the period ending March 31, 2021, inter-alia, due to ongoing second wave of the CoVID-19 pandemic and restrictions imposed by various state governments.
- After consideration, it has been decided to extend the due date for regulatory filings and compliances for InvITs and REITs for the period ending March 31, 2021 by one month over and above the timelines, prescribed under SEBI (Infrastructure Investment Trusts) Regulations, 2014 (InvIT Regulations) and SEBI (Real Estate Investment Trusts) Regulations, 2014 (REIT Regulations) and circulars issued thereunder.
SEBI has vide its notification dated 26th February, 2021 allowed the annual meeting of the unit holders of the Real Estate Investment Trust (REIT) and Infrastructure Investment Trust (InvIT) to be held on video conferencing mode or any other audio visual means upto 31st December 2021 and any other meetings other than annual meetings upto 30th June, 2021. The gist of the circular is given below
SEBI vide circular no. SEBI/HO/DDHS/DDHS/CIR/P/2020/102 dated June 22, 2020 read with circular no. SEBI/ HO/ DDHS/ DDHS/CIR/P/2020/201 dated October 08, 2020 permitted REITs/InvITs to conduct annual meetings and other meetings of unitholders through VC or OAVM up to December 31, 2020.
- Representations have been received to further extend the aforesaid facility to conduct meetings of unitholders which become due in the year 2021 through VC or OAVM for some more time. It is observed that MCA, vide circulars dated December 31, 2020 and January 13, 2021, permitted companies to conduct their Extraordinary General meetings upto June 30, 2021 and Annual General meetings due in the year 2021 through VC or OAVM.
- Accordingly, it has been decided to extend the facility to conduct meetings of unitholders, through VC or OAVM for REITs/InvITs, as under:
a. Annual meetings of unitholders in terms of Regulation 22(3) of SEBI (Real Estate Investment Trusts) Regulations, 2014 and Regulation 22(3)(a) of SEBI (Infrastructure Investment Trusts) Regulations, 2014, (which becomes due in the calendar year 2021) to be conducted till December 31, 2021.
b. For meetings other than annual meeting of unitholders till June 30, 2021.
- REITs/ InvITs shall comply with the procedure prescribed in Annexure-I of SEBI circular no. SEBI/ HO/ DDHS/ DDHS/ CIR/P/2020/102 dated June 22, 2020.
The International Financial Services Centres Authority (IFSCA), with an objective to develop the financial products and services in the Gujarat International Finance Tec-City International Financial Services Centre (GIFT IFSC) has prescribed the regulatory framework for Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) in IFSC.
IFSCA has permitted global participants i.e. REITs and InvITs incorporated in FATF compliant jurisdictions to list on the stock exchanges in GIFT IFSC.Additionally, InvITs have been permitted to raise funds through private placements also.
The REITs and InvITs registered in IFSC have been permitted to invest in real estate assets and infrastructure projects respectively in IFSC, India and other foreign jurisdictions, which is in line with the framework provided in the global financial centres.
Additionally, the REITs and InvITs that are already listed in any of the permissible jurisdictions other than IFSC (currently USA, Japan, South Korea, United Kingdom excluding British Overseas Territories, France, Germany, Canada and India) or India have been permitted to list and trade on the recognised stock exchanges in IFSC, subject to compliance with their respectivelaws of home jurisdiction.
The listing of REITs and InvITs in IFSC shall be in accordance with the requirements of the stock exchanges in IFSC.
The entities in IFSC can participate and benefit from the growth of real estate and infrastructure sector in international jurisdictions.
Further details on the framework for REITs and InvITsare available on the IFSCA website at the URL:https://ifsca.gov.in/Circular
SEBI circular dated 8th October, 2020 allowing unit holders of InvITs and REITs to hold their extraordinary meetings by video conferencing or any other audio visual means upto 31st December, 2020. Read on.
Subject: Extension of facility for conducting extraordinary meeting(s) of unit holders of InvITs and REITs through Video Conferencing or Other Audio-Visual Means (VC/OAVM)
- Kindly refer to SEBI circular no. SEBI/HO/DDHS/DDHS/CIR/P/2020/102 dated June 22, 2020, whereby InvITs/ REITs were permitted to conduct meetings of unitholders through VC or OAVM subject to compliance with the procedure specified therein.
- Vide clause 6 of the aforesaid circular, the facility of VC or OAVM was made available for annual meeting of unitholders in terms of Regulation 22(3)(a) of InvIT Regulations and Regulation 22(3) of REIT Regulations, to be conducted during calendar year 2020. For meetings, other than annual meeting of unitholders, the facility for conducting meeting of
unitholders through VC or OAVM was provided upto September 30, 2020.
- In this respect, representations have been received for extending the facility of VC or OAVM for conducting extraordinary meetings of unitholders for some more time due to the pandemic.
- In this regard, it has now been decided to extend the facility of VC or OAVM for conducting extraordinary meetings(s) of unitholders by InvITs/ REITs upto December 31, 2020, subject to compliance with the procedure prescribed in Annexure-I of SEBI circular no. SEBI/ HO/ DDHS/ DDHS/ CIR/P/2020/102 dated June 22, 2020.
SEBI has issued two circulars, both dated 28th September, 2020 in respect of amendments to guidelines for preferential issue and institutional placement by a listed InvIT and REIT. The amendments are identical in all respects except of course for the clause nos. in the respective guidelines.
The amendments are as follows:
- Clause 2.6 of the Guidelines is modified as under:
“The REIT shall not make any subsequent institutional placement until the expiry of two weeks from the date of the prior institutional placement made pursuant to one or more special resolutions.”
- After clause 2.1 and before clause 2.2 of sub-paragraph (A) of paragraph 2 of Annexure-I, the following provisos shall be inserted:
“Provided that, for any preferential issue made between the date of this circular and December 31, 2020, the REIT may opt for a pricing method where the price of the units to be allotted pursuant to the preferential issue shall not be less than the higher of the following:
(a) the average of the weekly high and low of the volume weighted average price of the related units quoted on the recognised stock exchange during the twelve weeks preceding the relevant date; or
(b) the average of the weekly high and low of the volume weighted average prices of the related units quoted on a recognised stock exchange during the two weeks preceding the relevant date.
Provided further that, units allotted on a preferential basis using the pricing method set out in the first proviso shall be locked-in for a period of three years:
Provided further that, all allotments arising out of the same unitholders approval shall follow the same pricing method.”
- After clause 3.1 of paragraph 3 of Annexure-I, the following explanation shall be inserted:
Explanation: For the computation of the lock-in requirement, the units held by the sponsor(s) and locked-in for three years, in the past in terms of Regulation 11 (3) of the REIT Regulations shall be taken into account. The units locked-in pursuant to Regulation 11(3) of the REIT Regulations shall not be put under fresh lock-in again, even though they are considered for computing the lock-in requirement, in case the said units are free of lock-in at the time of the preferential issue.
SEBI circular dated 16th September, 2020 on the subject matter.
Sub: Listing and trading of units of Infrastructure Investment Trusts (InvITs) and Real Estate Investment Trusts (REITs) on recognized stock exchanges in International Financial Services Centres (IFSC)
- Securities and Exchange Board of India (International Financial Services Centre) Guidelines, 2015 were notified by SEBI on March 27, 2015, which came into force on April 01, 2015.
- Clause 7 of SEBI (IFSC) Guidelines, 2015 specifies the types of securities in which dealing may be permitted by stock exchanges operating in IFSC. It has been decided to permit ‘Units of InvITs and REITs by whatever name called in the Permissible Jurisdictions’ as permissible security under sub-clause (vi) of Clause 7 of SEBI (IFSC) Guidelines, 2015.
- Accordingly, ‘Units of InvITs and REITs by whatever name called in the Permissible Jurisdictions’ meeting the following conditions may be permitted to list on stock exchanges operating in IFSC:
i. Such InvITs and REITs which are incorporated/settled in Permissible Jurisdictions, as may be notified by the Government of India from time to time pursuant to notification no. G.S.R. 669(E) dated September 18, 2019 in respect of sub-rule 1 of rule 9 of Prevention of Money-Laundering (Maintenance of Records) Rules, 2005;
In this regard, the Government of India vide notification dated November 28, 2019, has notified the list of Permissible Jurisdictions in pursuance of notification dated September 18, 2019. Accordingly, a list of Permissible Jurisdictions for the purpose of this clause is placed at Annexure A.
ii. Such InvITs and REITs are regulated by the securities market regulator(s) in the Permissible Jurisdictions.
iii. Such InvITs and REITs are listed on any of the specified international exchanges in the Permissible Jurisdiction. A list of International Exchanges for the purpose of this clause is also placed at Annexure A.
- Stock exchanges in IFSC shall evolve a detailed framework prescribing the initial and continuous listing requirements for such InvITs and REITs whose units are listed/proposed to be listed on stock exchanges in IFSC (based on para 3 above).
- The applicability of this circular is subject to such conditions that may be prescribed by SEBI, Reserve Bank of India and other appropriate authority from time to time.
List of Permissible Jurisdictions and International Exchanges
- United States of America – NASDAQ, NYSE
- Japan – Tokyo Stock Exchange
- South Korea – Korea Exchange Inc.
- United Kingdom excluding British Overseas Territories- London
- France – Euronext Paris
- Germany – Frankfurt Stock Exchange
- Canada – Toronto Stock Exchange