FEMA Archives - Page 2 of 3 - Neeraj Bhagat & Co.

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 …

January 1, 2021 / 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 …

April 8, 2020 / FEMA

FDI in Telecom Services sector

Telecommunications is one of the fastest growing industries in India that has undergone an innovative phase over the past few years and stands as the second largest telecommunications market in the world after China. It is due to liberalization policy that telecom sector could attract more FDI flows in private sector participation increased in total telephone connections of the nation. This led the sector to competitive stimulus, high telecom penetration and substantial reduction in tariffs. Though foreign telecom players have …

April 8, 2020 / FEMA

External Commercial Borrowings: Regulatory Framework Substantially Relaxed

Funding Indian corporates through debt has been traditionally been a preferred mode of funding due to inherent advantages such as security creation, minimum guaranteed returns and tax optimization for both the lender as well as the borrower. The modes for offshore debt funding have been limited to external commercial borrowings (“ECB”), non-convertible debentures (“NCD”), compulsorily convertible debentures and certain hybrid debt instruments. Each of these options have been subjected to regulatory restrictions in terms of eligible …

April 8, 2020 / FEMA

Closure of Liaison Office in India- Compliances to be done

Liaison offices (LOs) are a popular option for foreign investors exploring the Indian market for the first time, and unsure of how the country’s liberalizing FDI caps will affect their business.

In contrast to other business structures, LOs allow foreign companies to establish a light footprint in India while keeping their financial, legal, and administrative commitments low.

Normally, Liaison Office are registered in India for specified/limited purpose and when such purposes are achieved, either LO may want to get registered …

April 8, 2020 / FEMA

Overseas Direct Investment (ODI)

Introduction
1. Overseas investments (or financial commitment) in :
• Joint Venture (JV) &
• Wholly Owned Subsidiaries (WOS) have been recognized as important avenues for promoting global business by Indian entrepreneurs.

2. Joint ventures are perceived as amedium of:
• economic &
• business co-operation betweenIndia and other countries.

3. Transfer of :
• Technology & skill
• Sharing of results of R&D
• Access to wider global market
• Promotion of brand image
• Generation of employment &…