Depository Receipts like ADR, GDR..
ADRs –American Depository Receipts
American Depository Receipts are Receipts or Certificates issued by US
Bank representing specified number of shares of non-US Companies. Defined as under:
These are issued in capital market of USA alone. These represent securities of companies of other countries.
These securities are traded in US market. The US Bank is depository in this case. ADR is the evidence of ownership of the underlying shares. Unsponsored ADRs
It is the arrangement initiated by US brokers. US Depository banks create
such ADRs. The depository has to Register ADRs with SEC (Security
Exchange Commission). Sponsored ADRs
Issuing Company initiates the process. It promotes the company‟s ADRs in
the USA. It chooses single Depository bank. Registration with SEC is not
compulsory. However, unregistered ADRs are not listed in US exchanges. GDRs – Global Depository Receipts
Global Depository Receipt is a Dollar denominated instrument with
following features:
1. Traded in Stock exchanges of Europe. 2. Represents shares of other countries. 3. Depository bank in Europe acquires these shares and issues
“Receipts” to investors. 4. GDRs do-not carry voting rights. 5. Dividend is paid in local currency and there is no exchange risk for
the issuing company. 6. Issuing Co. collects proceeds in foreign currency which can be used
locally for meeting Foreign exchange requirements of Import. 7. GDRS are normally listed on “Luxembourg Exchange “ and traded
in OTC market London and private placement in USA. 8. It can be converted in underlying shares.
IDRs – Indian Deposits Receipts
Indian Depository Receipts are traded in local exchanges and represent
security of Overseas Companies. CDF (Currency Declaration Form)
CDF is required to be submitted by the person on his arrival to India at the
Airport to the custom Authorities in the following cases:
1. If aggregate of Foreign Exchange including foreign currency/TCs
exceeds USD 10000 or its equivalent. 2. If aggregate value of currency notes (cash portion) exceeds USD
5000 or its equivalent. Form A1 and
Form A2
Form A1 is meant for remittance abroad to settle imports obligations. It is
not required if value of imports is up to USD 5000. Form A2 is meant for remittance abroad on account of any purpose other
than Imports. It is not required if remittance is up to USD 25000. LIBOR Rate London Interbank Offering rate is the rate fixed at 11 am (London time) at
which top 16 banks in London offer to lend funds in interbank markets.
https://iibfadda.blogspot.com/2018/08/depository-receipts-like-adr.html?m=0
ADRs –American Depository Receipts
American Depository Receipts are Receipts or Certificates issued by US
Bank representing specified number of shares of non-US Companies. Defined as under:
These are issued in capital market of USA alone. These represent securities of companies of other countries.
These securities are traded in US market. The US Bank is depository in this case. ADR is the evidence of ownership of the underlying shares. Unsponsored ADRs
It is the arrangement initiated by US brokers. US Depository banks create
such ADRs. The depository has to Register ADRs with SEC (Security
Exchange Commission). Sponsored ADRs
Issuing Company initiates the process. It promotes the company‟s ADRs in
the USA. It chooses single Depository bank. Registration with SEC is not
compulsory. However, unregistered ADRs are not listed in US exchanges. GDRs – Global Depository Receipts
Global Depository Receipt is a Dollar denominated instrument with
following features:
1. Traded in Stock exchanges of Europe. 2. Represents shares of other countries. 3. Depository bank in Europe acquires these shares and issues
“Receipts” to investors. 4. GDRs do-not carry voting rights. 5. Dividend is paid in local currency and there is no exchange risk for
the issuing company. 6. Issuing Co. collects proceeds in foreign currency which can be used
locally for meeting Foreign exchange requirements of Import. 7. GDRS are normally listed on “Luxembourg Exchange “ and traded
in OTC market London and private placement in USA. 8. It can be converted in underlying shares.
IDRs – Indian Deposits Receipts
Indian Depository Receipts are traded in local exchanges and represent
security of Overseas Companies. CDF (Currency Declaration Form)
CDF is required to be submitted by the person on his arrival to India at the
Airport to the custom Authorities in the following cases:
1. If aggregate of Foreign Exchange including foreign currency/TCs
exceeds USD 10000 or its equivalent. 2. If aggregate value of currency notes (cash portion) exceeds USD
5000 or its equivalent. Form A1 and
Form A2
Form A1 is meant for remittance abroad to settle imports obligations. It is
not required if value of imports is up to USD 5000. Form A2 is meant for remittance abroad on account of any purpose other
than Imports. It is not required if remittance is up to USD 25000. LIBOR Rate London Interbank Offering rate is the rate fixed at 11 am (London time) at
which top 16 banks in London offer to lend funds in interbank markets.
https://iibfadda.blogspot.com/2018/08/depository-receipts-like-adr.html?m=0
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