RBI/2013-14/11
Master Circular No.11/2013-14
July 01, 2013
To,
All Authorised Dealer Category - I banks
Madam / Sir,
Master Circular on Direct Investment by Residents in Joint Venture (JV) /Wholly Owned Subsidiary (WOS) Abroad
Direct investments by residents in Joint Venture (JV) and Wholly Owned
Subsidiary (WOS) abroad are being allowed, in terms of clause (a) of sub-section
(3) of section 6 of the Foreign Exchange Management Act, 1999, (42 of 1999) read
with
Notification No. FEMA.120/RB-2004 dated July 7, 2004, (GSR 757 (E) dated
November 19, 2004), viz. Foreign Exchange Management (Transfer or Issue of Any
Foreign Security) Regulations, 2004, as amended from time to time.
2. This Master Circular consolidates the existing instructions on the subject of
“Direct Investment by Residents in Joint Venture (JV) / Wholly Owned Subsidiary
(WOS) Abroad" at one place. The list of underlying circulars / notifications is
furnished in the Appendix.
3. This Master Circular is issued with a sunset clause of one year. This
circular will stand withdrawn on July 01, 2014 and be replaced by an updated
Master Circular on the subject.
Yours faithfully,
(C. D. Srinivasan)
Chief General Manager
PART - I
Section A – General
A.1 Introduction
(1) Overseas investments in Joint Ventures (JV) and Wholly Owned Subsidiaries
(WOS) have been recognised as important avenues for promoting global business by
Indian entrepreneurs. Joint Ventures are perceived as a medium of economic and
business co-operation between India and other countries. Transfer of technology
and skill, sharing of results of R&D, access to wider global market, promotion
of brand image, generation of employment and utilisation of raw materials
available in India and in the host country are other significant benefits
arising out of such overseas investments. They are also important drivers of
foreign trade through increased exports of plant and machinery and goods and
services from India and also a source of foreign exchange earnings by way of
dividend earnings, royalty, technical know-how fee and other entitlements on
such investments.
(2) In keeping with the spirit of liberalisation, which has become the hallmark
of economic policy in general, and Foreign Exchange regulations in particular,
the Reserve Bank has been progressively relaxing the rules and simplifying the
procedures both for current account as well as capital account transactions.
A.2 Statutory basis
(1) Section 6 of the Foreign Exchange Management Act, 1999 provides powers to
the Reserve Bank to specify, in consultation with the Government of India the
classes of permissible capital account transactions and limits up to which
foreign exchange is admissible for such transactions. Section 6(3) of the
aforesaid Act provides powers to the Reserve Bank to prohibit, restrict or
regulate various transactions referred to in the sub-clauses of that
sub-section, by making Regulations.
(2) In exercise of the above powers conferred under the Act, the Reserve Bank
has in supersession of the earlier Notification No.FEMA19/RB-2000 dated 3rd May
2000 and subsequent amendments thereto, issued Foreign Exchange Management
(Transfer or Issue of any Foreign Security) Regulations, 2004 vide
Notification
No. FEMA.120/RB-2004 dated July 7, 20041. The Notification seeks to regulate
acquisition and transfer of a foreign security by a person resident in India
i.e. investment by Indian entities in overseas joint ventures and wholly owned
subsidiaries as also investment by a person resident in India in shares and
securities issued outside India. Overseas Investment can be made under two
routes viz. (i) Automatic Route outlined in paragraph B.1 and (ii) Approval
Route outlined in paragraph B.7.
A.3 Prohibitions
Indian parties are prohibited from making investment in a foreign entity engaged
in real estate (meaning buying and selling of real estate or trading in
Transferable Development Rights (TDRs) but does not include development of
townships, construction of residential/commercial premises, roads or bridges) or
banking business, without the prior approval of the Reserve Bank.
Clarification: An overseas entity, having direct or indirect equity
participation by an Indian party, shall not offer financial products linked to
Indian Rupee (e.g. non-deliverable trades involving foreign currency, rupee
exchange rates, stock indices linked to Indian market, etc.) without the
specific approval of the Reserve Bank. Any incidence of such product
facilitation would be treated as a contravention of the extant FEMA regulations
and would consequently attract action under the relevant provisions of FEMA,
19992.
A.4 General Permission
In terms of Regulation 4 of the Notification, general permission has been
granted to persons residents in India for purchase / acquisition of securities
in the following manner:
- out of the funds held in RFC account;
- as bonus shares on existing holding of foreign currency shares; and
- when not permanently resident in India, out of their foreign currency resources
outside India.
General permission is also available to sell the shares so purchased or
acquired.
Section B - Direct Investment Outside India
B.1 Automatic Route
(1) In terms of Regulation 6 of the Notification, an Indian party has been
permitted to make investment in overseas Joint Ventures (JV) / Wholly Owned
Subsidiaries (WOS), not exceeding 400 per cent of the net worth3 as on the date
of last audited balance sheet of the Indian party, i.e. a company incorporated
in India or a body created under an Act of Parliament or a partnership firm
registered under the Indian Partnership Act, 1932, making investment in a JV/WOS
abroad and includes any other entity in India excluding individuals as may be
notified by the Reserve Bank.
(2) The ceiling of 400 per cent of net worth will not be applicable where the
investment is made out of balances held in Exchange Earners' Foreign Currency
account of the Indian party or out of funds raised through ADRs/GDRs. The Indian
party should approach an Authorised Dealer Category - I bank with an application
in Form ODI (Annex A) and prescribed enclosures / documents for effecting
remittances towards such investments.
(3) The total financial commitment of the Indian party, in all the Joint
Ventures / Wholly Owned Subsidiaries put together, shall not exceed 400% of the
net worth of the Indian party as on the date of the last audited balance sheet.
For the purpose of determining the 'total financial commitment' within the limit
of 400% as specified above, the following shall be reckoned, namely:
- 100% of the amount of equity shares;
- 100% of the amount of compulsorily and mandatorily convertible preference
shares;
- 100% of the amount of other preference shares;
- 100% of the amount of loan;
- 100% of the amount of guarantee (other than performance guarantee) issued by the
Indian party;
- 100% of the amount of bank guarantee issued by a resident bank on behalf of JV
or WOS of the Indian party provided the bank guarantee is backed by a counter
guarantee / collateral by the Indian party.
- 50% of the amount of performance guarantee issued by the Indian party provided
that the outflow on account of invocation of performance guarantee results in
the breach of the limit of the financial commitment in force, prior permission
of the Reserve Bank is to be obtained before executing remittance beyond the
limit prescribed for the financial commitment.
Foot note: Compulsorily Convertible Preference Shares (CCPS) shall be treated at
par with equity shares.
(4) The investments are subject to the following conditions:
a) The Indian party / entity may extend loan / guarantee only to an overseas JV
/ WOS in which it has equity participation. Proposals from the Indian party for
undertaking financial commitment without equity contribution in JV / WOS may be
considered by the Reserve Bank under the approval route. AD banks may forward
the proposals from their constituents after ensuring that the laws of the host
country permit incorporation of a company without equity participation by the
Indian party.
Indian entities may offer any form of guarantee - corporate or personal
(including the personal guarantee by the indirect resident individual promoters
of the Indian Party)/ primary or collateral / guarantee by the promoter company
/ guarantee by group company, sister concern or associate company in India
provided that:
- All financial commitments including all forms of guarantees are within the
overall ceiling prescribed for overseas investment by the Indian party i.e.
currently within 400 per cent of the net worth as on the date of the last
audited balance sheet of the Indian party.
- No guarantee should be 'open ended' i.e. the amount and period of the guarantee
should be specified upfront. In the case of performance guarantee, time
specified for the completion of the contract shall be the validity period of the
related performance guarantee.
- In cases where invocation of the performance guarantees breach the ceiling for
the financial exposure of 400 per cent of the net worth of the Indian Party, the
Indian Party shall seek the prior approval of the Reserve Bank before remitting
funds from India, on account of such invocation.
- As in the case of corporate guarantees, all guarantees (including performance
guarantees and Bank Guarantees / SBLC) are required to be reported to the
Reserve Bank, in Form ODI-Part II. Guarantees issued by banks in India in favour
of WOSs / JVs outside India, and would be subject to prudential norms, issued by
the Reserve Bank (DBOD) from time to time.
Note: Specific approval of the Reserve Bank will be required for creating charge
on immovable / moveable property and other financial assets (except pledge of
shares of overseas JV / WOS) of the Indian party / group companies in favour of
a non-resident entity within the overall limit fixed (presently 400%) for the
financial commitment subject to submission of a ‘No Objection’ by the Indian
party and their group companies from their Indian lenders.
b) The Indian party should not be on the Reserve Bank’s Exporters' caution list
/ list of defaulters to the banking system circulated by the Reserve Bank /
Credit Information Bureau (India) Ltd. (CIBIL) / or any other credit information
company as approved by the Reserve Bank or under investigation by any
investigation / enforcement agency or regulatory body.
c) All transactions relating to a JV / WOS should be routed through one branch
of an Authorised Dealer bank to be designated by the Indian party.
d) In case of partial / full acquisition of an existing foreign company, where
the investment is more than USD 5 million, valuation of the shares of the
company shall be made by a Category I Merchant Banker registered with SEBI or an
Investment Banker / Merchant Banker outside India registered with the
appropriate regulatory authority in the host country; and, in all other cases by
a Chartered Accountant or a Certified Public Accountant.
e) In cases of investment by way of swap of shares, irrespective of the amount,
valuation of the shares will have to be made by a Category I Merchant Banker
registered with SEBI or an Investment Banker outside India registered with the
appropriate regulatory authority in the host country. Approval of the Foreign
Investment Promotion Board (FIPB) will also be a prerequisite for investment by
swap of shares.
f) In case of investment in overseas JV / WOS abroad by a registered Partnership
firm, where the entire funding for such investment is done by the firm, it will
be in order for individual partners to hold shares for and on behalf of the firm
in the overseas JV / WOS if the host country regulations or operational
requirements warrant such holdings.
g) An Indian party may acquire shares of a foreign company engaged in a bonafide
business activity, in exchange of ADRs/GDRs issued to the latter in accordance
with the Scheme for issue of Foreign Currency Convertible Bonds and Ordinary
Shares (through Depository Receipt Mechanism) Scheme, 1993, and the guidelines
issued there under from time to time by the Government of India, provided:
(i) ADRs/GDRs are listed on any stock exchange outside India;
(ii) The ADR and/or GDR issued for the purpose of acquisition is backed by
underlying fresh equity shares issued by the Indian party;
(iii) The total holding in the Indian entity by persons resident outside India
in the expanded capital base, after the new ADR and/or GDR issue, does not
exceed the sectoral cap prescribed under the relevant regulations for such
investment under FDI;
(iv) Valuation of the shares of the foreign company shall be
(a) as per the recommendations of the Investment Banker if the shares are not
listed on any recognized stock exchange; or
(b) based on the current market capitalisation of the foreign company arrived at
on the basis of monthly average price on any stock exchange abroad for the three
months preceding the month in which the acquisition is committed and over and
above, the premium, if any, as recommended by the Investment Banker in its due
diligence report in other cases.
(5) The Indian Party is required to report such acquisition in form ODI to the
AD Bank for submission to the Reserve Bank within a period of 30 days from the
date of the transaction.
Note: Investments in Nepal are permitted only in Indian Rupees. Investments in
Bhutan are permitted in Indian Rupees as well as in freely convertible
currencies. All dues receivable on investments made in freely convertible
currencies, as well as their sale / winding up proceeds are required to be
repatriated to India in freely convertible currencies only. Investments in
Pakistan by Indian Parties are permissible under the approval route.
B.1.1 Issue of guarantee by an Indian Party to step down subsidiary of JV / WOS
(a) Indian Parties are permitted to issue corporate guarantees on behalf of
their first level step down operating JV /WOS set up by their JV / WOS operating
as a Special Purpose Vehicle (SPV) under the Automatic Route, subject to the
condition that the financial commitment of the Indian Party is within the extant
limit for overseas direct investment. It has been decided that irrespective of
whether the direct subsidiary is an operating company or a SPV, the Indian
promoter entity may extend corporate guarantee on behalf of the first generation
step down operating company under the Automatic Route, within the prevailing
limit for overseas direct investment. Such guarantees will have to be reported
to the Reserve Bank in Form ODI, as hitherto, through the designated AD Category
– I bank concerned.
(b) Further, the issuance of corporate guarantee on behalf of second generation
or subsequent level step down operating subsidiaries will be considered under
the Approval Route, provided the Indian Party directly or indirectly holds 51
per cent or more stake in the overseas subsidiary for which such guarantee is
intended to be issued.
B.1.2 Investment through Special Purpose Vehicle (SPV) under Automatic Route
(i) Investments in JV/WOS abroad by Indian parties through the medium of a
Special Purpose Vehicle (SPV) are also permitted under the Automatic Route in
terms of Regulation 6 of the Notification, subject to the conditions that the
Indian party is not included in the Reserve Bank's caution list or is under
investigation by the Directorate of Enforcement or included in the list of
defaulters to the banking system circulated by the Reserve Bank/any other Credit
Information company as approved by the Reserve Bank. Indian parties whose names
appear in the Defaulters' list require prior approval of the Reserve Bank for
the investment.
(ii) Setting up of an SPV under the Automatic Route is permitted for the purpose
of making a investment in JV/WOS overseas.
B.2 Investment in unincorporated entities overseas under the Automatic Route
(1) Investments in unincorporated / incorporated4 entities overseas in the oil
sector (i.e. for exploration and drilling for oil and natural gas, etc.) by
Navaratna PSUs, ONGC Videsh Ltd (OVL) and Oil India Ltd (OIL) may be permitted
by AD Category - I banks, without any limit, provided such investments are
approved by the competent authority.
(2) Other Indian companies are also permitted under the Automatic Route to
invest in unincorporated entities overseas in the oil sector up to 400 per cent
of their net worth provided the proposal has been approved by the competent
authority and is duly supported by certified copy of the Board resolution
approving such investment. Investment in excess of 400 per cent of the net worth
of an Indian company shall require prior approval of the Reserve Bank.
(3) Indian companies are also permitted to participate in a consortium with
other international operators to construct and maintain submarine cable systems
on co-ownership basis under the automatic route. Accordingly, AD Category - I
banks may allow remittances by Indian companies for overseas direct investment,
after ensuring that the Indian company has obtained necessary licence from the
Department of Telecommunication, Ministry of Telecommunication & Information
Technology, Government of India to establish, install, operate and maintain
International Long Distance Services and also by obtaining a certified copy of
the Board Resolution approving such investment.
Accordingly, these transactions may be reported by the Indian parties investing
in the consortium to the AD Category-I banks in Form ODI for enabling on-line
submission of the same by the AD Category-I banks to the Reserve Bank for
allotment of Unique Identification Number.
B.3 Method of Funding
(1) Investment in an overseas JV / WOS may be funded out of one or more of the
following sources:
i) drawal of foreign exchange from an AD bank in India;
ii) capitalisation of exports;
iii) swap of shares (valuation as mentioned in para B.1 (e) above);
iv) proceeds of External Commercial Borrowings (ECBs) / Foreign Currency
Convertible Bonds (FCCBs);
v) in exchange of ADRs/GDRs issued in accordance with the Scheme for issue of
Foreign Currency Convertible Bonds and Ordinary Shares (through Depository
Receipt Mechanism) Scheme, 1993, and the guidelines issued thereunder from time
to time by the Government of India;
vi) balances held in EEFC account of the Indian party and
vi) proceeds of foreign currency funds raised through ADR / GDR issues.
In respect of (vi) and (vii) above, the ceiling of 400 per cent of the net worth
will not apply. However, all investments made in the financial sector will be
subject to compliance with Regulation 7 of the Notification, irrespective of the
method of funding.
(2) General permission has been granted to persons resident in India for
purchase / acquisition of securities in the following manner:
(i) out of funds held in RFC account;
(ii) as bonus shares on existing holding of foreign currency shares; and
(iii) when not permanently resident in India, out of their foreign currency
resources outside India (para A.4 above)
B.4 Capitalisation of exports and other dues
(1) Indian party is permitted to capitalise the payments due from the foreign
entity towards exports, fees, royalties or any other dues from the foreign
entity for supply of technical know-how, consultancy, managerial and other
services within the ceilings applicable. Capitalisation of export proceeds
remaining unrealised beyond the prescribed period of realization will require
prior approval of the Reserve Bank.
(2) Indian software exporters are permitted to receive 25 per cent of the value
of their exports to an overseas software start-up company in the form of shares
without entering into Joint Venture Agreements, with prior approval of the
Reserve Bank.
B.5 Investments in Financial Services Sector
(1) In terms of Regulation 7 of the Notification, an Indian party seeking to
make investment in an entity outside India, which is engaged in the financial
sector, should fulfill the following additional conditions:
(i) be registered with the regulatory authority in India for conducting the
financial sector activities;
(ii) has earned net profit during the preceding three financial years from the
financial services activities;
(iii) has obtained approval from the regulatory authorities concerned both in
India and abroad for venturing into such financial sector activity; and
(iv) has fulfilled the prudential norms relating to capital adequacy as
prescribed by the concerned regulatory authority in India.
(2) Any additional investment by an existing JV/WOS or its step down subsidiary
in the financial services sector is also required to comply with the above
conditions.
(3) Regulated entities in the financial sector making investments in any
activity overseas are required to comply with the above guidelines. Unregulated
entities in the financial services sector in India may invest in non financial
sector activities subject to compliance with the provisions of Regulation 6 of
the Notification. Trading in Commodities Exchanges overseas and setting up
JV/WOS for trading in overseas exchanges will be reckoned as financial services
activity and require clearance from the Forward Markets Commission.
B.6 Investment in Equity of Companies Registered Overseas / Rated Debt
Instruments
(1)(i) Portfolio Investments by listed Indian companies
Listed Indian companies are permitted to invest up to 50 per cent of their net
worth as on the date of the last audited balance sheet in (i) shares and (ii)
bonds / fixed income securities, rated not below investment grade by accredited
/ registered credit rating agencies, issued by listed overseas companies.
(ii) Investment by Mutual Funds
Indian Mutual Funds registered with SEBI are permitted to invest within an
overall cap of USD 7 billion in:
i) ADRs / GDRs of the Indian and foreign companies;
ii) equity of overseas companies listed on recognised stock exchanges overseas ;
iii) initial and follow on public offerings for listing at recognized stock
exchanges overseas;
iv) foreign debt securities in the countries with fully convertible currencies,
short- term as well as long-term debt instruments with rating not below
investment grade by accredited/registered credit agencies;
v) money market instruments rated not below investment grade;
vi) repos in the form of investment, where the counterparty is rated not below
investment grade. The repos should not, however, involve any borrowing of funds
by mutual funds;
vii) government securities where the countries are rated notbelow investment
grade;
viii) derivatives traded on recognized stock exchanges overseasonly for hedging
and portfolio balancing with underlying as securities;
ix) short-term deposits with banks overseas where the issuer is rated not below
investment grade; and
x) units / securities issued by overseas Mutual Funds or Unit Trusts registered
with overseas regulators and investing in (a) aforesaid securities, (b) Real
Estate Investment Trusts (REITS) listed on recognized stock exchanges overseas,
or (c) unlisted overseas securities (not exceeding 10 per cent of their net
assets).
(2) A limited number of qualified Indian Mutual Funds, are permitted to invest
cumulatively up to USD 1 billion in overseas Exchange Traded Funds as may be
permitted by SEBI.
(3) Domestic Venture Capital Funds registered with SEBI may invest in equity and
equity linked instruments of off-shore Venture Capital Undertakings, subject to
an overall limit of USD 500 million. Accordingly, Mutual Funds / Venture Capital
Funds desirous of availing of this facility may approach SEBI for necessary
permission.
(4) General permission is available to the above categories of investors for
sale of securities so acquired.
B.7 Approval of the Reserve Bank
(1) Prior approval of the Reserve Bank would be required in all other cases of
direct investment abroad. For this purpose, application together with necessary
documents should be submitted in Form ODI through their Authorised Dealer
Category – I banks.
(2) Reserve Bank would, inter alia, take into account the following factors
while considering such applications:
- Prima facie viability of the JV / WOS outside India;
- Contribution to external trade and other benefits which will accrue to India
through such investment;
- Financial position and business track record of the Indian party and the foreign
entity; and
- Expertise and experience of the Indian party in the same or related line of
activity as of the JV / WOS outside India.
B.8 Investments in energy and natural resources sector
Reserve Bank will consider applications for investment in JV/WOS overseas in the
energy and natural resources sectors (e.g. oil, gas, coal and mineral ores) in
excess of 400 per cent of the net worth of the Indian companies as on the date
of the last audited balance sheet. AD Category - I banks may forward such
applications from their constituents to the Reserve Bank as per the laid down
procedure.
B.9 Overseas Investments by Proprietorship Concerns
(1) With a view to enabling recognized star exporters with a proven track record
and a consistently high export performance to reap the benefits of globalization
and liberalization, proprietorship concerns and unregistered partnership firms
are allowed to set up JVs / WOS outside India with the prior approval of the
Reserve Bank subject to satisfying certain eligibility criteria. An application
in form ODI may be made to the Chief General Manager, Reserve Bank of India,
Foreign Exchange Department, Overseas Investment Division, Central Office, Amar
Building, 5th Floor, Fort, Mumbai 400 001, through the AD Category - I bank. AD
Category - I banks may forward the applications to the Reserve Bank along with
their comments and recommendations, for consideration.
(2) Investments by established proprietorship or unregistered partnership
exporter firms will be subject to the following conditions:
i) The Partnership / Proprietorship firm is a DGFT recognized Star Export House.
ii) The AD Category – I bank is satisfied that the exporter is KYC (Know Your
Customer) compliant and is engaged in the proposed business and meets the
requirement as indicated at i) above.
iii) Exporter has proven track record i.e. overdue exports do not exceed 10 per
cent of the average export realization of preceding three financial years.
iv) The exporter has not come under adverse notice of any Government agency like
Directorate of Enforcement, CBI and does not appear in the exporters' caution
list of the Reserve Bank or in the list of defaulters to the banking system in
India.
v) The amount of investment outside India does not exceed 10 per cent of the
average export realization of the preceding three financial years or 200 per
cent of the net owned funds of the firm, whichever is lower.
B.10 Overseas investment by Registered Trust / Society
Registered Trusts and Societies engaged in manufacturing / educational /
hospital sector are allowed to make investment in the same sector(s) in a JV/WOS
outside India, with the prior approval of the Reserve Bank. Trusts / Societies
satisfying the eligibility criteria, as indicated below, may submit the
application/s in Form ODI-Part I, through their AD Category - I bank/s, to the
Chief General Manager, Reserve Bank of India, Foreign Exchange Department,
Overseas Investment Division, Central Office, Amar Building, 5th Floor, Fort,
Mumbai 400 001, for consideration.
Eligibility Criteria:
(a) Trust
i) The Trust should be registered under the Indian Trust Act, 1882;
ii) The Trust deed permits the proposed investment overseas;
iii) The proposed investment should be approved by the trustee/s;
iv) The AD Category – I bank is satisfied that the Trust is KYC (Know Your
Customer) compliant and is engaged in a bonafide activity;
v) The Trust has been in existence at least for a period of three years;
vi) The Trust has not come under the adverse notice of any Regulatory /
Enforcement agency like the Directorate of Enforcement, Central Bureau of
Investigation (CBI), etc.
(b) Society
i) The Society should be registered under the Societies Registration Act, 1860.
ii) The Memorandum of Association and rules and regulations permit the Society
to make the proposed investment which should also be approved by the governing
body / council or a managing / executive committee.
iii) The AD Category - I bank is satisfied that the Society is KYC (Know Your
Customer) compliant and is engaged in a bonafide activity;
iv) The Society has been in existence at least for a period of three years;
v) The Society has not come under the adverse notice of any Regulatory /
Enforcement agency like the Directorate of Enforcement, CBI etc.
In addition to the registration, the AD Category – I bank should ensure that the
special license / permission has been obtained by the applicant in case the
activities require special license / permission either from the Ministry of Home
Affairs, Government of India or from the relevant local authority, as the case
may be.
B.11 Post investment changes / additional investment in existing JV / WOS
A JV / WOS set up by the Indian party as per the Regulations may diversify its
activities / set up step down subsidiary / alter the shareholding pattern in the
overseas entity (subject to compliance of Regulation 7 of the Notification in
the case of financial services sector companies). The Indian party should report
to the Reserve Bank through the AD Category - I bank, the details of such
decisions within 30 days of the approval of those decisions by the competent
authority of the JV / WOS concerned in terms of local laws of the host country
and include the same in the Annual Performance Report (APR - Part III of Form
ODI) required to be forwarded to the AD Category-I bank.
B.12 Restructuring of the balance sheet of the overseas entity involving write
off of capital and receivables
In order to provide more operational flexibility to the Indian corporates, the
Indian promoters who have set up WOS abroad or have at least 51 per cent stake
in an overseas JV, may write off capital (equity / preference shares) or other
receivables, such as, loans, royalty, technical knowhow fees and management fees
in respect of the JV /WOS, even while such JV /WOS continues to function as
under:
- Listed Indian companies are permitted to write off capital and other receivables
up to 25 per cent of the equity investment in the JV /WOS under the Automatic
Route; and
- Unlisted companies are permitted to write off capital and other receivables up
to 25 per cent of the equity investment in the JV /WOS under the Approval Route.
The write-off / restructuring have to be reported to the Reserve Bank through
the designated AD Category-I bank within 30 days of write-off/ restructuring.
The write-off / restructuring is subject to the condition that the Indian Party
should submit the following documents for scrutiny along with the applications
to the designated AD Category –I bank under the Automatic as well as the
Approval Routes:
a) A certified copy of the balance sheet showing the loss in the overseas WOS/JV
set up by the Indian Party; and
b) Projections for the next five years indicating benefit accruing to the Indian
company consequent to such write off / restructuring.
B.13 Acquisition of a foreign company through bidding or tender procedure
An Indian party may remit earnest money deposit or issue a bid bond guarantee
for acquisition of a foreign company through bidding and tender procedure and
also make subsequent remittances through an AD Category - I bank, in accordance
with the provisions of Regulation 14 of the Notification.
B.14 Obligations of Indian Party
(1) An Indian party which has made direct investment abroad is under obligation
to (a) receive share certificate or any other document as an evidence of
investment, (b) repatriate to India the dues receivable from foreign entity, and
(c) submit the documents / Annual Performance Report to the Reserve Bank, in
accordance with the provisions specified in Regulation 15 of the Notification.
The share certificate or any other document as evidence of investment has to be
submitted to and retained by the designated AD Category - I bank, who is
required to monitor the receipt of such documents and satisfy themselves about
the bonafides of the documents. A certificate to this effect should be submitted
by the designated AD category – I bank to the Reserve Bank along with the APR
(Part III of Form ODI).
(2) Reporting requirements including submission of Annual Performance Report are
also applicable for investors in unincorporated entities in the oil sector.
(3) Where the law of the host country does not mandatorily require auditing of
the books of accounts of JV / WOS, the Annual Performance Report (APR) may be
submitted by the Indian party based on the un-audited annual accounts of the JV
/ WOS provided:
- The Statutory Auditors of the Indian party certify that ‘The un-audited annual
accounts of the JV / WOS reflect the true and fair picture of the affairs of the
JV / WOS’ and
- That the un-audited annual accounts of the JV / WOS has been adopted and
ratified by the Board of the Indian party.
B.15 Transfer by way of sale of shares of a JV / WOS
(1) An Indian Party, without prior approval of the Reserve Bank, may transfer by
way of sale to another Indian Party which complies with the provisions of
Regulation 6 of FEMA Notification 120/RB-2004 dated July 7, 2004 or to a person
resident outside India, any share or security held by it in a JV or WOS outside
India subject to the following conditions:
(i) the sale does not result in any write off of the investment made.
(ii) the sale is effected through a stock exchange where the shares of the
overseas JV/ WOS are listed;
(iii) if the shares are not listed on the stock exchange and the shares are
disinvested by a private arrangement, the share price is not less than the value
certified by a Chartered Accountant / Certified Public Accountant as the fair
value of the shares based on the latest audited financial statements of the JV /
WOS;
(iv) the Indian party does not have any outstanding dues by way of dividend,
technical know-how fees, royalty, consultancy, commission or other entitlements
and / or export proceeds from the JV or WOS;
(v) the overseas concern has been in operation for at least one full year and
the Annual Performance Report together with the audited accounts for that year
has been submitted to the Reserve Bank;
(vi) the Indian party is not under investigation by CBI / DoE/ SEBI / IRDA or
any other regulatory authority in India.
(2) The Indian party is required to submit details of such disinvestment through
its designated AD category-I bank within 30 days from the date of disinvestment.
B.16 Transfer by way of sale of shares of a JV / WOS involving Write off of the
investment
(1) Indian Party may disinvest, without prior approval of the Reserve Bank, in
any of the under noted cases where the amount repatriated after disinvestment is
less than the original amount invested:
- in case where the JV / WOS is listed in the overseas stock exchange;
- in cases where the Indian Party is listed on a stock exchange in India and has a
net worth of not less than Rs.100 crore;
- where the Indian Party is an unlisted company and the investment in the overseas
venture does not exceed USD 10 million. and
- where the Indian Party is a listed company with net worth of less than Rs.100
crore but investment in an overseas JV/WOS does not exceed USD 10 million.
(2) Such disinvestments shall be subject to the conditions listed at B.15 items
(ii) to (vi) and B 15.2.
(3) An Indian Party, which does not satisfy the conditions laid down above for
undertaking any disinvestment in its JV/WOS abroad, shall have to apply to the
Reserve Bank for prior permission.
B.17 Pledge of Shares of JV/WOS
An Indian party may pledge the shares of JV / WOS to an AD Category – I bank or
a public financial institution in India for availing of any credit facility for
itself or for the JV / WOS abroad in terms of Regulation 18 of the Notification.
Indian party may also transfer by way of pledge, the shares held in overseas
JV/WOS, to an overseas lender, provided the lender is regulated and supervised
as a bank and the total financial commitments of the Indian party remain within
the limit stipulated by the Reserve Bank for overseas investments, from time to
time.
B.18 Hedging of Overseas Direct Investments
(1) Resident entities having overseas direct investments are permitted to hedge
the foreign exchange rate risk arising out of such investments. AD Category - I
banks may enter into forward / option contracts with resident entities who wish
to hedge their overseas direct investments (in equity and loan), subject to
verification of such exposure.
(2) If a hedge becomes naked in part or full owing to shrinking of the market
value of the overseas direct investment, the hedge may continue to the original
maturity. Rollovers on the due date are permitted up to the extent of market
value as on that date.
SECTION C - Other Investments in Foreign Securities
C.1 Permission for purchase/ acquisition of foreign securities in certain cases
(1) General permission has been granted to a person resident in India who is an
individual –
- to acquire foreign securities as a gift from any person resident outside India;
- to acquire shares under cashless Employees Stock Option Programme (ESOP) issued
by a company outside India, provided it does not involve any remittance from
India;
- to acquire shares by way of inheritance from a person whether resident in or
outside India;
- to purchase equity shares offered by a foreign company under its ESOP Schemes,
if he is an employee, or, a director of an Indian office or branch of a foreign
company, or, of a subsidiary in India of a foreign company, or, an Indian
company in which foreign equity holding, either direct or through a holding
company/Special Purpose Vehicle (SPV) irrespective of the percentage of the
direct or indirect equity stake in the Indian company. AD Category – I banks are
permitted to allow remittances for purchase of shares by eligible persons under
this provision irrespective of the method of operationalisation of the scheme
i.e where the shares under the scheme are offered directly by the issuing
company or indirectly through a trust / a Special Purpose Vehicle (SPV) / step
down subsidiary, provided (i) the shares under the ESOP Scheme are offered by
the issuing company globally on a uniform basis, and (ii) an Annual Return
(Annex B) is submitted by the Indian company to the Reserve Bank through the AD
Category – I bank giving details of remittances / beneficiaries, etc.
(2) A person resident in India may transfer by way of sale the shares acquired
as stated above provided that the proceeds thereof are repatriated immediately
on receipt thereof and in any case not later than 90 days from the date of sale
of such securities.
(3) Foreign companies are permitted to repurchase the shares issued to residents
in India under any ESOP Scheme provided (i) the shares were issued in accordance
with the Rules / Regulations framed under Foreign Exchange Management Act, 1999,
(ii) the shares are being repurchased in terms of the initial offer document,
and (iii) an annual return is submitted through the AD Category – I bank giving
details of remittances / beneficiaries, etc.
(4) In all other cases, not covered by general or special permission, approval
of the Reserve Bank is required to be obtained before acquisition of a foreign
security.
C.2 Pledge of a foreign security by a person resident in India
The shares acquired by persons resident in India in accordance with the
provisions of Foreign Exchange Management Act, 1999 or Rules or Regulations made
thereunder are allowed to be pledged for obtaining credit facilities in India
from an AD Category – I bank / Public Financial Institution.
C.3 General permission in certain cases
Residents are permitted to acquire a foreign security, if it represents –
- qualification shares for becoming a director of a company outside India to the
extent prescribed as per the law of the host country where the company is
located provided it does not exceed the limit prescribed for the resident
individuals under the Liberalized Remittance Scheme (LRS) in force at the time
of acquisition;
- part / full consideration of professional services rendered to the foreign
company or in lieu of Director’s remuneration. The limit of acquiring such
shares in terms of value is restricted to the overall ceiling prescribed for the
resident individuals under the Liberalized Remittance Scheme (LRS) in force at
the time of acquisition;
- rights shares provided that the rights shares are being issued by virtue of
holding shares in accordance with the provisions of law for the time being in
force;
- purchase of shares of a JV / WOS abroad of the Indian promoter company by the
employees/directors of Indian promoter company which is engaged in the field of
software where the consideration for purchase does not exceed USD 10,000 or its
equivalent per employee in a block of five calendar years; the shares so
acquired do not exceed 5 per cent of the paid-up capital of the JV / WOS outside
India; and after allotment of such shares, the percentage of shares held by the
Indian promoter company, together with shares allotted to its employees is not
less than the percentage of shares held by the Indian promoter company prior to
such allotment; and
- purchase of foreign securities under ADR / GDR linked stock option schemes by
resident employees of Indian companies in the knowledge based sectors, including
working directors provided purchase consideration does not exceed USD 50,000 or
its equivalent in a block of five calendar years.
PART - II
Operational Instructions to Authorised Dealer Banks
1. Designated branches
An eligible Indian party making investment in a Joint Venture (JV) / Wholly
Owned Subsidiary (WOS) outside India is required to route all its transactions
relating to the investment through one branch of an AD Category – I bank
designated by it in terms of clause (v) of sub regulation 2 of Regulation 6 of
the Notification. All communication from the Indian parties, to the Reserve
Bank, relating to the investment outside India should be routed through the same
branch of the AD Category – I bank that has been designated by the Indian
investor for the investment. The designated AD Category – I bank while
forwarding the request from their customers to the Reserve Bank, should also
forward its comments / recommendations on the request. However, the Indian party
may designate different AD Category – I banks / branches of AD Category – I
banks for different JV / WOS outside India. For proper follow up, the AD
Category – I bank is required to maintain party-wise record in respect of each
JV/ WOS.
2. Investments under Regulation 6 of Notification No. FEMA 120/2004-RB dated
July 7, 2004
AD Category – I banks may allow investments up to the permissible limits on
receipt of application in form ODI together with form A-2, duly filled in, from
the Indian party(ies) making investments in a JV/WOS abroad subject to their
complying with the conditions specified in Regulation 6 of
Notification FEMA
No.120/RB-2004 dated July 7, 2004, as amended from time to time. Investment in
financial services should also comply with the norms stipulated at Regulation 7
of the Notification. While forwarding the report of remittance in respect of
investment in financial services sector, AD Category – I banks may certify that
prior approvals from the Regulatory Authorities concerned in India and abroad
have been obtained. Before allowing the remittance, AD Category – I banks are
required to ensure that the necessary documents, as prescribed in form ODI, have
been submitted and found to be in order.
3. General procedural instructions
(1) With effect from June 01, 2007, reporting system for overseas investment has
been revised. All the earlier forms have been subsumed into one form viz. ODI,
comprising of four parts:
Part I - includes the following:
Section A – Details of the Indian Party
Section B – Details of Investment in New Project
Section C - Details of Investment in Existing Project
Section D – Funding for JV / WOS
Section E – Declaration by the Indian Party (to be retained by AD Category – I
bank)
Section F - Certificate by the Statutory Auditors of the Indian Party (to be
retained by AD Category – I bank)
Part II - Reporting of Remittances
Part III - Annual Performance Report (APR)
Part IV – Report on Closure/Disinvestment/Voluntary Liquidation/Winding up of JV
/ WOS
(2) The revised form is only a rationalisation and simplification of the
reporting procedure and there is no change or dilution in the existing
eligibility criteria / documentation / limits.
(3) With effect from March 2, 2010 on-line reporting of the ODI forms has been
operationalised in a phased manner. The system enables on-line generation of the
Unique Identification Number (UIN), acknowledgment of remittance/s and filing of
the Annual Performance Reports (APRs) and easy accessibility to data at the AD
level for reference purposes.
a) Initially, Part I (Sections A to D), II and III of form ODI should be filed
on-line in the Overseas Investment Application for allotment of UIN, reporting
of subsequent remittances, filing of APRs, etc. AD Category –I banks would
continue to receive the ODI forms in physical form, as stipulated in the
A. P.
(DIR Series) Circular No. 68 dated June 1, 2007, which should be preserved, UIN
wise, for onward submission to the Reserve Bank, if specifically required.
Transactions in respect of Mutual Funds, Portfolio Investment Scheme (PIS) and
Employees Stock Options Scheme (ESOPS) are also required to be reported on-line
in the Overseas Investment Application.
b) The on-line reporting would be required to be made by the Centralized
Unit/Nodal Office of AD Category - I banks. The Overseas Investment Application
is hosted on the Reserve Bank's Secured Internet Website (SIW)
https://secweb.rbi.org.in and a link has been made available for accessing the
Application on the main page of the website. AD Category – I banks would be
responsible for the validity of the information reported on-line.
c) The application for overseas investment under the approval route would
continue to be submitted to the Reserve Bank in physical form as hitherto, in
addition to the on-line reporting of Part I as contemplated above, for approval
purposes.
d) In case of disinvestment / closure / winding up / voluntary liquidation under
the Automatic Route, in terms of
A. P. (Dir Series) Circular No. 29 dated March
27, 2006, a report should continue to be submitted by the designated AD Category
- I bank, in Part IV of form ODI. In all other cases of disinvestment, an
application along with the necessary supporting documents should be submitted to
the Reserve Bank as per the existing procedure.
e) As per the new reporting system, AD Category – I banks would be able generate
the UIN on-line under the automatic route. However, subsequent remittances under
the automatic route and remittances under the approval route should be made and
reported on-line in Part II, only after receipt of auto generated e-mail from
RBI confirming the UIN.
(4) In cases where the investment is being made jointly by more than one Indian
party, form ODI is required to be signed jointly by all the investing entities
and submitted to the designated branch of the AD Category – I bank. AD Category
– I banks should file on-line a consolidated form ODI indicating details of each
party. The same procedure should be followed where the investment is made out of
the proceeds of ADR / GDR issues of an Indian party in terms of Regulation 6(5)
of the Notification. The Reserve Bank would allot only one Unique Identification
Number to the overseas project.
(5) AD Category – I banks should allow remittance towards loan to the JV / WOS
and / or issue guarantee to / on behalf of the JV / WOS abroad only after
ensuring that the Indian party has an equity stake in the JV / WOS. However, as
has been stated at para B 1 (3) (a) above, wherever the laws of the host country
permit incorporation of a company without equity participation by the Indian
party, AD banks may obtain prior approval from the Reserve Bank before allowing
the remittances towards the loan/issue of guarantee to/on behalf of the overseas
JV/WOS.
4. Investments under Regulation 11 of Notification No. FEMA.120/2004-RB dated
July 7, 2004
In terms of Regulation 11 of the Notification, Indian parties are permitted to
make direct investment in JV / WOS abroad by way of capitalisation of exports or
other dues/entitlements like royalties, technical know-how fees, consultancy
fees, etc. In such cases also, the Indian party is required to submit details of
the capitalisation in form ODI to the designated branch of the AD Category – I
bank. Such investments by way of capitalisation are also to be reckoned while
computing the cap of 400 per cent prescribed in terms of Regulation 6. Further,
in cases where the export proceeds are being capitalised in accordance with the
provisions of Regulation 11, the AD Category – I banks are required to obtain a
custom certified copy of the invoice as required under Regulation 12(2) and
forward it to the Reserve Bank together with the revised form ODI.
Capitalisation of export proceeds or other entitlements, which are overdue,
would require prior approval of the Reserve Bank for which the Indian parties
should make an application in form ODI to the Reserve Bank for consideration.
5. Allotment of Unique Identification Number (UIN)
The Unique Identification Number allotted to each JV or WOS abroad, is required
to be quoted in all correspondence with the Reserve Bank. AD Category – I banks
may allow additional investment in an existing overseas concern set up by an
Indian party, in terms of Regulation 6 only after the Reserve Bank has allotted
necessary Unique Identification Number to the overseas project.
6. Investment by way of share swap
In the case of investment by way of share swap, AD Category – I banks are
additionally required to submit to the Reserve Bank the details of transactions
such as number of shares received / allotted, premium paid / received, brokerage
paid / received, etc., and also confirmation to the effect that the inward leg
of transaction has been approved by FIPB and the valuation has been done as per
the laid-down procedure and that the overseas company’s shares are issued /
transferred in the name of the Indian investing company. AD Category – I bank
may also obtain an undertaking from the applicants to the effect that future
sale / transfer of shares so acquired by Non-Residents in the Indian company
shall be in accordance with the provisions of Notification No. FEMA 20/2000-RB
dated May 3, 2000, as amended from time to time.
7. Investments under Regulation 9 of Notification No. FEMA.120/2004-RB dated
July 7, 2004
In terms of Regulation 9, investment in JV / WOS in certain cases requires the
prior approval of the Reserve Bank. AD Category – I banks may allow remittances
under these specific approvals granted by the Reserve Bank and report the same
to the Chief General Manager, Foreign Exchange Department, Central Office,
Overseas Investment Division, Amar Building, 5th floor, Mumbai 400 001 in form
ODI.
8. Purchase of foreign securities under ADR / GDR linked Stock Option Scheme
AD Category – I banks may make remittances up to USD 50,000 or its equivalent in
a block of five calendar years, without the prior approval of the Reserve Bank,
for purchase of foreign securities in the knowledge based sector under the ADR /
GDR linked ESOPs, after satisfying that the issuing company has followed the
relevant guidelines of SEBI / Government.
9. Remittance towards Earnest Money Deposit or Issue of Bid Bond Guarantee
(i) In terms of Regulation 14 of the Notification, AD Category – I banks may, on
being approached by an Indian party which is eligible for investment under
Regulation 6, allow remittance towards Earnest Money Deposit (EMD) to the extent
eligible after obtaining Form A2 duly filled in or may issue bid bond guarantee
on their behalf for participation in bidding or tender procedure for acquisition
of a company incorporated outside India. On winning the bid, AD banks may remit
the acquisition value after obtaining Form A2 duly filled in and report such
remittance (including the amount initially remitted towards EMD) to the Chief
General Manager, Foreign Exchange Department, Central Office, Overseas
Investment Division, Amar Building, 5th floor, Mumbai 400 001 in form ODI. AD
Category – I banks, while permitting remittance towards EMD should advise the
Indian party that in case they are not successful in the bid, they should ensure
that the amount remitted is repatriated in accordance with Foreign Exchange
Management (Realisation, Repatriation & Surrender of Foreign Exchange)
Regulations, 2000 (cf.
Notification No. FEMA 9/2000-RB dated 3rd May 2000), as
amended from time to time
(ii) In cases where an Indian party, after being successful in the bid / tender
decides not to proceed further with the investment, AD banks should submit full
details of remittance allowed towards EMD / invoked bid bond guarantee, to the
Chief General Manager, Foreign Exchange Department, Central Office, Overseas
Investment Division, Amar Building, 5th floor, Mumbai 400 001.
(iii) In case the Indian party is successful in the bid, but the terms and
conditions of acquisition of a company outside India are not in conformity with
the provisions of Regulations in Part I, or different from those for which
approval under sub-regulation (3) was obtained, the Indian entity should obtain
approval from the Reserve Bank by submitting form ODI.
10. Transfer by way of sale of shares of a JV / WOS outside India
The Indian party should report details of the disinvestment through the AD
Category – I bank within 30 days of disinvestment in Part IV of the Form ODI as
indicated in para 3 (3) (c) above. Sale proceeds of shares / securities shall be
repatriated to India immediately on receipt thereof and in any case not later
than 90 days from the date of sale of the shares / securities.
11. Verification of evidence of investment
The share certificates or any other document as evidence of investment, where
share certificates are not issued shall, henceforth, be submitted to and
retained by the designated AD Category –I bank, who would be required to monitor
the receipt of such documents and satisfy themselves about the bonafides of the
documents so received. A certificate to this effect should be submitted by the
designated AD Category –I bank to the Reserve Bank along with the APR (Part III
of Form ODI).
12. Opening of Foreign Currency Account abroad by an Indian party
Wherever, the host country Regulations stipulate that the investments into the
country are required to be routed through a designated account, an Indian party
is allowed to open, hold and maintain Foreign Currency Account (FCA) abroad for
the purpose of overseas direct investments subject to certain terms and
conditions stipulated under
A.P. (DIR Series) Circular No. 101 dated April 02,
2012.
Appendix
List of Circulars/Notifications consolidated in the Master Circular
Direct Investment in Joint Ventures/ Wholly Owned Subsidiaries Abroad
Notifications
Sl. No. |
Notification No. |
Date |
1. |
FEMA.120/2004-RB |
July 07, 2004 |
2. |
FEMA.132/2005-RB |
March 31, 2005 |
3. |
FEMA.135/2005-RB |
May 17, 2005 |
4. |
FEMA.139/2005-RB |
August 11, 2005 |
5. |
FEMA.150/2006-RB |
August 21, 2006 |
6. |
FEMA.164/2007-RB |
October 9, 2007 |
7. |
FEMA.173/2007-RB |
December 19, 2007 |
8. |
FEMA.180/2008-RB |
September 5, 2008 |
9. |
FEMA.181/2008-RB |
October 1, 2008 |
10. |
FEMA.196/2009-RB |
July 28, 2009 |
11. |
FEMA.225/2012-RB |
March 07, 2012 |
12. |
FEMA.231/2012-RB |
May 30, 2012 |
13. |
FEMA.249/2012-RB |
December 31, 2012 |
A.P. (DIR Series) Circulars
Sl. No. |
Circular No. |
Date |
1. |
AP (DIR Series) Circular No.14 |
October 01, 2004 |
2. |
AP (DIR Series) Circular No.32 |
February 09, 2005 |
3. |
AP (DIR Series) Circular No.42 |
May 12, 2005 |
4.. |
AP (DIR Series) Circular No.9 |
August 29, 2005 |
5. |
AP (DIR Series) Circular No.29 |
March 27, 2006 |
6. |
AP (DIR Series) Circular No.30 |
April 05, 2006 |
7. |
AP (DIR Series) Circular No. 3 |
July 03, 2006 |
8. |
AP (DIR Series) Circular No.6 |
September 06, 2006 |
9. |
AP (DIR Series) Circular No. 11 |
November 16, 2006 |
10. |
AP (DIR Series) Circular No. 41 |
April 20, 2007 |
11. |
AP (DIR Series) Circular No. 49 |
April 30, 2007 |
12. |
AP (DIR Series) Circular No. 50 |
May 04, 2007 |
13. |
AP (DIR Series) Circular No.53 |
May 08, 2007 |
14. |
AP (DIR Series) Circular No.68 |
June 01, 2007 |
15. |
AP (DIR Series) Circular No. 72 |
June 08, 2007 |
16. |
AP (DIR Series) Circular No.75 |
June 14, 2007 |
17. |
AP (DIR Series) Circular No.76 |
June 19, 2007 |
18. |
AP (DIR Series) Circular No. 11 |
September 26, 2007 |
19. |
AP (DIR Series) Circular No. 12 |
September 26, 2007 |
20. |
AP (DIR Series) Circular No. 34 |
April 03, 2008 |
21. |
AP (DIR Series) Circular No. 48 |
June 03, 2008 |
22. |
AP (DIR Series) Circular No. 53 |
June 27, 2008 |
23. |
AP (DIR Series) Circular No.07 |
August 13, 2008 |
24. |
AP (DIR Series) Circular No. 14 |
September 05, 2008 |
25. |
AP (DIR Series) Circular No. 36 |
February 24, 2010 |
26. |
AP (DIR Series) Circular No. 45 |
April 01, 2010 |
27. |
AP (DIR Series) Circular No.69 |
May 27, 2011 |
28. |
AP (DIR Series) Circular No.73 |
June 29, 2011 |
29. |
AP (DIR Series) Circular No. 96 |
March 28, 2012 |
30. |
AP (DIR Series) Circular No. 97 |
March 28, 2012 |
31. |
AP (DIR Series) Circular No. 101 |
April 02, 2012 |
32. |
AP (DIR Series) Circular No. 131 |
May 31, 2012 |
33. |
AP (DIR Series) Circular No. 15 |
August 21, 2012 |
34. |
AP (DIR Series) Circular No. 25 |
September 07, 2012 |
35. |
AP (DIR Series) Circular No. 29 |
September 12, 2012 |
36. |
AP (DIR Series) Circular No. 99 |
April 23, 2013 |
37. |
AP (DIR Series) Circular No. 100 |
April 25, 2013 |
1 As amended vide Notification No. FEMA 132/2005-RB dated 31st March 2005,
Notification No. FEMA 135/2005-RB dated 17th May 2005, Notification No. FEMA
139/2005-RB dated 11th August 2005, Notification No. FEMA 150/2006-RB dated 21st
August 2006, Notification No. FEMA 164/2007-RB dated 9th October 2007,
Notification No. FEMA173/2007-RB dated 19th December 2007, Notification No. FEMA
180/2008-RB dated 5th September 2008, Notification No. FEMA181/2008-RB dated 1st
October 2008 and Notification No. FEMA196/2009-RB dated 30th September 2009
(hereinafter referred to as ‘the Notification’)
2
A.P. (DIR Series) Circular No. 100 dated April 25, 2013
3 Net worth means paid up capital and free reserves
4 A.P. (DIR Series) Circular No. 99 dated April 23, 2013