• Form FC – GPR for issue of shares to Non-Residents – to be filed Online

    February 13 2015

    Reserve Bank of India, has, with a view to promote, the ease of reporting of transaction under Foreign Direct Investment, has enabled the Online Filing of Form FC- GPR - which a company submits to RBI for reporting the issue of eligible instruments to the overseas investor against the above mentioned FDI inflow.

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  • External Commercial Borrowings (ECB) from Foreign Equity Holder (FEH) & Outbound Investment by a Limited Liability Partnership (LLP)

    May 20 2014


    As per the extant ECB policy, ECBs from direct foreign equity holders (FEHs) are considered both under the automatic and the approval routes. ECBs from indirect equity holders and group companies and ECBs from direct FEH for general corporate purpose are, however, considered under the approval route. Further, any request for change of the ECB lender in case of FEH requires RBI’s approval.

    Reserve Bank of India has come out with a circular delegating powers to AD Banks to approve raising of ECBs for the following cases under the automatic route:

    1. By companies belonging to manufacturing, infrastructure, hotels, hospitals and software sectors from indirect equity holders and group companies.
    2. Companies in miscellaneous services from direct / indirect equity holders and group companies. Miscellaneous services mean companies engaged in training activities (but not educational institutes), research and development activities and companies supporting infrastructure sector. Companies doing trading business, companies providing logistics services, financial services and consultancy services are, however, not covered under the facility.
    3. By companies belonging to manufacturing, infrastructure, hotels, hospitals and software sectors for general corporate purpose.ECB for general corporate purpose (which includes working capital financing) is, however, permitted only from direct equity holder.
    4. Change of lender when the ECB is from FEH – direct / indirect equity holders and group company.

    Overseas Direct Investment (ODI) /Outbound Investment by a LLP permitted

    Limited Liability Partnership (LLP), registered under the Limited Liability Partnership Act, 2008 is notified as an "Indian Party" for regulations w.r.t Overseas Investment and accordingly an LLP can undertake financial commitment on behalf of a JV/WOS abroad.

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  • Foreign Direct Investment (FDI) in a Limited Liability Partnership (LLP) – Regulations & Forms notified

    April 9 2014

    Limited Liability Partnership (LLP) is an ever evolving concept in India and is a form which is luring many foreign investors these days.
    Reserve Bank of India (RBI) has notified regulations for FDI in a LLP with retrospective effect from 20th May, 2011.
    The regulations attempt to provide clarity on following areas:
    1. Who will be the eligible investors
    2. Eligibility criteria for LLP accepting foreign investment
    3. What will be the eligible investment
    4. Entry route i.e. for FDI in LLP prior FIPB approval is must.
    5. Pricing of investment
    6. Mode of payment
    7. Reporting to RBI in new forms FOREIGN DIRECT INVESTMENT-LLP(I) & FOREIGN DIRECT INVESTMENT-LLP(II) within the time limits. (same as FC -GPR & FC -TRS applicable to a Pvt Ltd Co)
    The already existing LLPs with FDI will have to comply with reporting requirements within the time limit from the date of issue of this notification.
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  • Revised form FC-GPR for reporting issue of shares and convertible debentures under Foreign Direct Investment (FDI) scheme

    February 12 2014

    Foreign Direct Investment in an Indian entity by an NRI/Foreign Entity in the form of shares or by way of Convertible Debentures is required to be reported to RBI in Form FC-GPR within 30 days of issue of such shares/convertible debentures.

    RBI has now revised such Form FC-GPR to gather additional details such as Brownfield/Greenfield investments and the date of incorporation of investee company

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  • External Commercial Borrowings by Holding Companies/Core Investment Companies for Infrastructure project use in Special Purpose Vehicles (SPVs)

    December 4 2013

    RBI comes out with a circular permitting Holding Companies/ Core Investment Companies (CICs) to raise ECB under the automatic route/approval route for project use in SPV subject to certain terms and conditions:

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  • Third Party payments for import/export transactions allowed by RBI

    November 19 2013

    • RBI comes out with a circular allowing third party payments for export/import transactions.
    • Normally payment for exports has to be received from the overseas buyer named in the Export Declaration Form (EDF) by the exporter and the payment shall be received in a currency appropriate to the place of final destination as mentioned in the EDF irrespective of the country of residence of the buyer. Similarly, the payments for the import should be made to the original overseas seller of the goods and the AD should ensure that the importer furnishes evidence of import, such as, Exchange Control copy of the Bill of Entry to satisfy itself that goods equivalent to the value of remittance have been imported.
    • Taking into account the evolving international trade practices the said requirement has been liberalised by RBI and has allowed third party payments for import/export transactions subject to satisfying certain conditions.
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