Consultation Paper on Issuance of Depository Receipts against units of REITs and Publicly Listed InvITs

Securities and Exchange Board of India, vide Consultation Paper dated August 04, 2026, has announced an important update regarding the proposed regulatory framework for issuance of Depository Receipts (DRs) against units of REITs and publicly listed InvITs.

Key Details of the Update –

• Objective: SEBI seeks public comments on a proposed framework to permit issuance of Depository Receipts (DRs) backed by units of Real Estate Investment Trusts (REITs) and publicly listed Infrastructure Investment Trusts (InvITs).

• The proposals are based on the recommendations of SEBI's Hybrid Securities Advisory Committee (HYSAC).

• Existing legal provisions under the Depository Receipts Scheme, 2014 and the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 already recognize REIT and InvIT units as eligible instruments for issuance of DRs.

• Although the existing regulatory framework permits DR issuance in principle, the SEBI REIT Regulations, 2014 and SEBI InvIT Regulations, 2014 currently do not contain enabling provisions governing such issuance.

• Applicability: The proposal applies to REITs and Publicly Listed InvITs only. It does not extend to Privately Listed InvITs, considering their investor eligibility restrictions and minimum trading lot requirements.

• SEBI proposes inserting:
• Regulation 14(12A) in the REIT Regulations; and
• Regulation 14(4)(ma) in the InvIT Regulations,
to expressly permit issuance of Depository Receipts subject to SEBI regulations and any framework specified by the Board.

• SEBI also proposes issuing a separate circular prescribing the detailed operational framework for DR issuance, largely based on the existing Equity Depository Receipt Framework contained in the SEBI Master Circular for Stock Exchanges and Clearing Corporations dated December 30, 2024, with modifications specific to REITs and Publicly Listed InvITs.

• The consultation specifically seeks comments on:
• Permitting issuance of DRs for REITs and Publicly Listed InvITs.
• The draft framework contained in Annexure A.

• Effective Date: Not Mentioned.

• Key Changes: Introduction of an enabling regulatory provision and a dedicated operational framework to facilitate issuance of DRs backed by REIT and Publicly Listed InvIT units.

• Penalty/Consequence: Not Mentioned.

Actions if Any –

• Stakeholders may submit comments, views, and supporting rationale on the proposed regulatory framework through SEBI's prescribed online consultation process.

Compliance Deadline –

• Public comments on the consultation paper must be submitted on or before August 25, 2026.