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CS Professional · Strategic Management and Corporate Finance · An Overview on Listing and Issuance of Securities in International Financial Services Centre

Which statement about the Authority's functions concerning the issue of debt or equity securities in an IFSC is correct under the IFSCA Act, 2019?

The Authority has a duty to both develop and regulate financial products, services and institutions in IFSCs. This covers products already permitted before the Act by any regulator, as well as other products notified by the Central Government, so its role is not limited to recommendations or post-listing oversight.

  1. AThe Authority's duty is limited to regulating products only after listing, not their development
  2. BThe Authority may only recommend and has no regulatory power over financial products
  3. CThe Authority can regulate only products permitted after the Act commenced
  4. DThe Authority must develop and regulate financial products, services and institutions in IFSCs, including those permitted earlier by another regulatorCorrect

Explanation

Section 12 makes it the Authority's duty to develop and regulate financial products, services and institutions in IFSCs, and expressly includes those permitted before commencement by any regulator. It also recommends other products to the Central Government, but that is not its only role.

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