No, the rollover mechanism does not prohibit the purchase of OTC FX Futures contracts longer than six (6M) months. Foreign Portfolio Investors may still purchase OTC FX Futures contracts of any tenor subject to the existence of a valid CCI and compliance with the provisions of the extant OTC FX Futures
Market Operational Standards may still be made.
However, only OTC FX Futures contracts with tenor from 1M – 6M can be rolled over. Consequently, while the purchase of OTC FX Futures contracts with tenors from 7M – 12M remains permissible for FPIs, subsequent purchase of 7M – 12M OTC FX Futures contracts cannot be booked as a rollover under the provisions of MB-33. To clarify; an FPI with a valid CCI who purchases a 9M OTC FX Futures contract and decides to buy another 9M OTC FX Futures contract may do so in line with the provisions of the OTC FX Futures Market Operational Standards. However, the purchase of the new 9M OTC FX Futures contract cannot be booked and treated as a “rollover” under MB-33 because the combined tenor of the original hedge (9M) and the subsequent hedge (9M)
is eighteen (18M) months, thus violating the provision of clause3(iii)of