| Date: |
15-12-2001
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| Notification No: |
RBI A P D (Series)Circular No 16/2001
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| Issuing Authority: |
RBI
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| Type: |
A.P.D.(Series) Circulars
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| File No: |
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| Subject: |
Permission for Purchase/ Acquisition of Foreign Securities - Clarification
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Permission for Purchase/ Acquisition of Foreign Securities -
Clarification
Attention
of authorised dealers is invited to item (e) of paragraph 2 of the AP (DIR
Series) circular No. 32 dated April 28, 2001. In terms of Regulations 19 of the
Reserve Bank Notification No. FEMA.19/2000-RB dated May 3, 2000, as amended from
time to time, ADs have been permitted to allow remittance by a person resident
in India, being an individual, who is an employee or director, of an office or
branch in India of a foreign company or a subsidiary in India of a foreign
company or of an Indian company in which foreign equity holding is not less than
51 per cent, provided the shares are offered at concessional price. The eligible
residents as defined in sub-paragraph (2) of the Regulation 19 are permitted to
remit USD 20,000, or its equivalent per calendar year provided the shares are
being offered on a concession.
2.
It is clarified that the concession in price of shares being offered
under Employees Stock Option Scheme (ESOP) may be borne by the foreign company
issuing the shares or by its Indian branch/ office/ subsidiary or the company in
India in which the foreign equity holding is not less than 51 per cent.
3.
Authorised dealers may bring the contents of this circular to the notice
of their constituents concerned.
4.
The directions contained in this circular have been issued under Section
10(4) and Section 11(1) of the Foreign Exchange Management Act, 1999 (42 of
1999).
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