Tuesday, June 25, 2013

Sebi to have final say in Jet-Etihad deal: Arvind Mayaram

New Delhi:  The Foreign Investment Promotion Board (FIPB) will go by market regulator Sebi's verdict on whether effective control and management was being passed on to Etihad post its buyout of 24% in Jet airways. This will ensure that there is no further debate on the issue once Sebi takes a stand. "We would be writing to Sebi in a day or two. We are asking them to clarify if they are seized of the matter concerning effective control and management. Rather than asking the investor to justify its point to two agencies, it's better that only one agency takes the call," said Arvind Mayaram, secretary, department of economic affairs, who also chairs the inter-ministerial body that clears foreign investment proposals. Mayaram said Sebi's response on the issue would then be put up before the FIPB which will meet after four weeks. The FIPB had on June 14 deferred a decision on the Jet-Etihad proposal due to lack of clarity over the level of control exercised by the Gulf investor and the ownership structure of the company post the transaction. The decision was based on a specific provision laid down in the FDI policy. The FDI policy, specified in Press Note 6, says that a scheduled operator's permit can be granted only to a company that is registered and has its principal place of business within India and whose chairman and at least two-thirds of directors are citizens of India.
25/06/13 Deepshikha Sikarwar/Economic Times