The union government has relaxed norms for issuance of foreign currency convertible bonds (FCCBs), equity through ADRs (American Depository Receipts) and GDRs (Global Depository Receipts). The move is aimed to help the corporate world for more freedom in pricing of equity shares as per prevailing market prices.

The government has amended the rules related to relevant date and price calculation of foreign currency convertible bonds. Now, the pricing date would be considers from the same day when the company's board of directors decides to issue shares to foreign investors. Earlier, pricing date was considered before thirty days when the shareholder’s meeting was held. Issue price is also revised and it would be now considered on the basis of the average of the weekly high and low of the two weeks prior to the relevant date. It is worth noting that these changes are made on the request of the industry that is facing tough situation after huge fall in stock market.

Earlier, RBI has already allowed companies to buy back their FCCBs with fresh foreign exchange resources or external commercial borrowings (ECBs).