List and describe three differences and advantages of Global Registered Shares (GRS) over American Depositary Receipts (ADRs)

What will be an ideal response?

Answer: Depositary receipts are negotiable certificates issued by a bank to represent the underlying shares of stock held in trust at a foreign custodian bank. Those receipts traded in the U.S. and denominated in dollars are called American depositary receipts (ADR). ADRs do offer some technical advantages: dividends are received in dollars rather than a foreign currency, ADRs are in registered form rather than bearer form, transfer of ownership is done in accordance with U.S. laws, and in the event of death, probate is in the U.S. and not abroad. Taxes are easier, trading costs are typically lower, and settlement is also faster.
A global registered share (GRS) is a share of equity that is traded across borders and markets without conversion, where one share on the home exchange equals one share on the foreign exchange. If target pricing is important in key markets like that of the U.S., then the ADR offers better opportunities for a foreign firm to gain greater presence and activity. There are two fundamental arguments in favor of GRSs over ADRs, both based on pure forces of globalization:1) Investors and markets alike will continue to grow, 2) Regulations governing security trading across country markets will continue to converge towards a common set of global principles, eliminating the need for securities customized for local market attributes or requirements. Other potential distinctions include the possibility of retaining all voting rights (GRSs do by definition while some ADRs may not) and the general principle that ADRs are designed for one singular cultural and legal environment-the United States.