Tata Motors, which manufactures both luxury cars as well as trucks, has been asked by US stock market regulator Securities and Exchange Commission (SEC) to increase the level of disclosures pertaining to its operations in certain countries in the Middle East and Africa, and specifically in Iran, two people with knowledge of the matter said on condition of anonymity.
The Department of Global Security Risk, a division of the SEC, has written to Tata Motors seeking details of the company's exports to Iran and also asked the company to make more disclosures about the operations of its affiliates through which it carries out business in the Iranian market, according to the people quoted above.
A spokesperson for Tata Motors confirmed that the SEC has asked the company for more information on its exports to the Middle East and Africa when contacted by ET NOW. A spokesperson for the SEC said in an emailed response, "SEC staff on a regular basis review company filings and ask questions related to whether company disclosures are sufficient".
Tata Motors, whose American Depository Receipts (ADR's) trade on the NYSE, has asked for time till next week to respond to the SEC.
Iran is amongst countries facing sanctions from the US government and many federal agencies are closely monitoring the operations of companies in their jurisdiction that do business in the Iranian market.
Amongst such agencies is The Office of Foreign Assets Control or OFAC. Banks that do business in the US market often seek clearances from OFAC if they are lending to clients that have operations in countries facing sanctions.
However, a senior executive at a US-based bank which lends money to Tata Motors said it has never had any problems receiving OFAC clearances when giving loans to the company for its overseas operations but said he wasn't surprised that the SEC was seeking such disclosures.
Lenders that financed telecom major Bharti for its acquisition of Zain Africa had to seek OFAC clearances because the company had operations in countries with unstable political regimes.
Tata Motors draws 20% of its exports from the Middle East market and much of its exports to Iran are routed through Tata Daewoo, a wholly owned subsidiary of Tata Motors. Exports accounted for 6.5% of the company's total revenues in financial year 2010-2011.
Recently many Indian oil refiners including private companies such as Essar Oil and state-run companies such as Indian Oil Corporation have also reduced their dependence on crude supplies from Iran under directions from the Indian government.
Source: Economic Times
The Department of Global Security Risk, a division of the SEC, has written to Tata Motors seeking details of the company's exports to Iran and also asked the company to make more disclosures about the operations of its affiliates through which it carries out business in the Iranian market, according to the people quoted above.
A spokesperson for Tata Motors confirmed that the SEC has asked the company for more information on its exports to the Middle East and Africa when contacted by ET NOW. A spokesperson for the SEC said in an emailed response, "SEC staff on a regular basis review company filings and ask questions related to whether company disclosures are sufficient".
Tata Motors, whose American Depository Receipts (ADR's) trade on the NYSE, has asked for time till next week to respond to the SEC.
Iran is amongst countries facing sanctions from the US government and many federal agencies are closely monitoring the operations of companies in their jurisdiction that do business in the Iranian market.
Amongst such agencies is The Office of Foreign Assets Control or OFAC. Banks that do business in the US market often seek clearances from OFAC if they are lending to clients that have operations in countries facing sanctions.
However, a senior executive at a US-based bank which lends money to Tata Motors said it has never had any problems receiving OFAC clearances when giving loans to the company for its overseas operations but said he wasn't surprised that the SEC was seeking such disclosures.
Lenders that financed telecom major Bharti for its acquisition of Zain Africa had to seek OFAC clearances because the company had operations in countries with unstable political regimes.
Tata Motors draws 20% of its exports from the Middle East market and much of its exports to Iran are routed through Tata Daewoo, a wholly owned subsidiary of Tata Motors. Exports accounted for 6.5% of the company's total revenues in financial year 2010-2011.
Recently many Indian oil refiners including private companies such as Essar Oil and state-run companies such as Indian Oil Corporation have also reduced their dependence on crude supplies from Iran under directions from the Indian government.
Source: Economic Times
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