The government plans to change rules and provide Indian companies with the flexibility of buying or selling shares to a strategic partner in future, easing decadesold restrictions on forward contracts. Companies, both in India and abroad, include clauses relating to put and call options in negotiated agreements to protect and hedge the interests of the seller and the buyer. India's securities laws don't allow certain contracts unless they are either related to spot delivery or settled in cash. The issue came to the fore last year when the Securities and Exchange Board of India (Sebi) directed Vedanta Resources and Cairn Energy to delete put and call options and preemption right clauses when Vedanta sought to buy Cairn's controlling interest in its Indian unit.
Source: Economic Times
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