FEMA – Neeraj Bhagat & Co.

September 21, 2020 / FEMA

Overseas Direct Investment Without Remittance of Funds From India

An investment outside India can be done by an Indian party or an individual or (single or in association with another resident individual or with an ‘Indian Party’). All resident individuals, including minors, are allowed to freely remit up to USD 250,000 per financial year.

An Indian Party can make overseas direct investment in any bonafide activity. However, Real estate and banking business are the prohibited sectors for overseas direct investment. But, Indian banks operating in India can set up …

May 6, 2020 / FEMA

FDI in E-commerce

The Indian retail industry has emerged as one of the most dynamic and fast-paced industries due to the entry of several new players. It is not only a form of business but more a mode of earning of livelihood for tens of millions of people in the Country. India’s e-commerce market has witnessed a phenomenal growth in the past recent years and is still flourishing. Foreign Direct Investment in E-Commerce in India can lead to an influx of capital, further …

April 28, 2020 / FEMA

RBI guidelines for opening various bank accounts outside India

Many Indian companies have opened subsidiaries abroad when all that they required was a collection bank account. This is often felt necessary for the purpose of collecting payments from customers either through bank transfers or through online transactions.

Reserve Bank of India, strangely, is positively inclined towards Indians opening companies abroad but does not seem inclined to encourage Indians to open collection accounts in foreign banks.

RBI regulates opening of bank accounts outside India,in terms of section 9 of the …

April 23, 2020 / FEMA

Setting up subsidiary outside India

With the advent of Globalization, more and more Indian companies are interested in doing business outside India. They want to set-up a branch office or a subsidiary abroad. There are multiple benefits of doing so such as cost reduction because they save on import duty, ease of doing business, building an international brand etc.

Overseas investment in wholly owned subsidiaries or joint ventures has been recognized as important avenues for promoting global business by Indian entrepreneurs.

Broadly there are two …

April 21, 2020 / FEMA

Set up Branch office /Representative office outside India

Indian dynamism, entrepreneurship and enthusiasm is seeking new horizons across the globe. Of course, anyone stepping into a foreign land must take care of the laws, rules and regulations of the host country. Each country is different and keeping abreast of the laws of different countries can indeed be a challenge.

Reserve Bank of India controls and regulates investment in foreign entities by persons who are residents of India. A person may be a citizen of India and resident outside …

April 11, 2020 / FEMA

Foreign Currency – Transfer of Shares (FC-TRS)- Points to Remember

FCTRS (Foreign Currency- Transfer of Shares):

1. No fee for filing of form FC-TRS, if filed within 60 days from the date of receipt/date of payment of the amount of consideration otherwise the RBI/ AD Bank may impose the penalty for late filling by way of Late Submission fee (LSF).

2. Onus of filing of form FC-TRS lies on the transferor/transferee whosoever is resident in India.

3. The transferor/transferee filing the form needs to register itself with RBI-Firms portal before …

April 9, 2020 / FEMA

LLPs and ECBs in India

Amidst the recent global challenges and trade wars, many developing countries, including India, faced macro-economic issues due to weakness in their currencies. The Indian government has taken many steps to stabilize the volatility in the rupee by carrying out open market operations in the currency markets, boost exports, additional import duties, etc. India has also taken another step in boosting its foreign reserves by liberalizing the foreign currency loan regime.

The external commercial borrowings regime provides for a framework for …

April 8, 2020 / FEMA

RBI reporting under Single Master Form (SMF)

The Reserve bank of India has announced the new reporting structure for FDI related transactions in which they have combined different reporting into a single combined form i.e. the Single Master Form (‘SMF’) which subsumed all the existing reporting in different forms such as ARF, FCGPR, FCTRS etc. Also, by implementation of this new structure, a new reporting online portal (FIRMS) has been introduced in place of EBIZ.

FIRMS, RBI is an online reporting platform for reporting of foreign investments …

April 8, 2020 / FEMA

Cabinet nod for foreign listing of firms, decriminalising offences

The Union Cabinet has approved 72 changes to the Companies Act 2013, with a thrust on decriminalising compoundable offences and allowing direct foreign listing for domestic companies to boost “Brand India”.
The nod for the Companies amendment Bill, likely to be tabled in the ongoing Parliament session, has been given to ease compliance burden related to corporate social responsibility (CSR) by exempting companies with obligation to spend Rs. 50 lakh or less. Such companies will not be required to have …