Highlights of regulations pertaining to investment by non-Iranians
in securities listed in the TSE, as ratified by the Cabinet of
Ministers on 16.03.1384- June 6, 2005:
-
Activities of foreign investors in the Tehran Stock
Exchange are pending upon authorization given by the Investment,
Technical and Economic Assistance Organization of Iran (an affiliate
of the Ministry of Economic Affairs and Finance).
-
"Stock Exchange Council" sets the allowed ceilings for foreign
investment in the TSE monthly.
-
Foreign investors are to transfer the whole amount
of authorized investment within one year to Iran. Otherwise, new
authorization must be obtained after the above period.
-
Foreign investors can solely invest in the following
financial assets:
·
Shares of stock of listed companies
· Other securities traded in the TSE
· Certificates of participation (bonds) traded in
the TSE
-
The official translation of the following documents
is required before authorization to trade is given to a foreign
investing entity:
·
Articles of association of foreign investor
· Particulars of the shareholders with more than 5%
interest
· Particulars of directors
· Particulars of bank account(s) allocated to
transactions in the Market (this holds for legal persons too).
-
The bank account must be opened with an Iranian bank
and solely used for transactions in the Market. Any proceeds from
sale of securities and/or dividends received are to be deposited in
this account.
-
Foreign investor is not allowed to use the funds for
any other purpose or other investments.
-
Investments of any foreign investor, acquired
through the following, should not exceed 10% of the outstanding
shares of the company:
·
Purchase of shares on the bases of these
regulations
· Purchase of Global Depository Receipt (GDR)
· Purchase of shares of Iranian companies traded in
foreign stock exchanges
-
The following information /documents are also
required:
·
Financial statements (annual and quarterly)
pertaining to activities of the investor in the TSE
· Details of investment portfolio
· Monthly statements of bank accounts allocated to
transactions in the TSE
-
Activities of foreign investors must be audited by
accredited auditors.
-
In cases where foreign investors are not able to
re-invest the principal and accumulated earnings thereto, transfer
of their capital abroad is possible after three years and upon
authorization of the Investment, Technical and Economic Assistance
Organization of Iran.
-
Limitations of these regulations do not apply to
foreign direct investments made by foreign investors for such
purposes as participation in management or earning profit.
