Exemption from APR filing curtailed where JV/WOS is in FATF observed or enhanced due diligence jurisdictions under RBI prescription.
The amendment to Regulation 15 requires Statutory Auditors of the Indian party to certify that the host country does not mandate auditing of the JV/WOS and that APR figures are taken from unaudited overseas accounts. It removes availability of the exemption from filing the APR based on unaudited balance sheets for JV/WOS in FATF-observed jurisdictions, those recommended for enhanced due diligence by FATF, or any other jurisdictions prescribed by the Reserve Bank.

Foreign investment regulation: RBI issues rules governing transfer or issuance of securities by persons resident outside India.
The Regulations govern transfers and issuances of securities by persons resident outside India, issued under clause (b) of sub section (3) of section 6 and section 47 of the Foreign Exchange Management Act, 1999, and supersede prior notifications FEMA 20/2000 RB and FEMA 24/2000 RB to consolidate the regulatory framework for non resident investment via securities.

Simplified hedging procedures permit eligible resident and non-resident entities to manage permitted exchange-rate exposures efficiently.
Resident entities having foreign currency exposures and non-resident entities having rupee exposures, excluding individuals, may hedge underlying exchange-rate risk. The exposure must arise from transactions permitted under the Foreign Exchange Management Act, 1999, or instruments, directions or orders issued under it. Hedging is subject to simplified terms and conditions prescribed from time to time by the Reserve Bank.

Foreign exchange regulation amendment removes requirement for exchange control copies of shipping bills, effective on Gazette publication.
The amendment provides a short title and commencement provision effective upon Gazette publication and amends Regulation 6 by deleting the phrase referencing Exchange Control copies of the shipping bills following the references to EDF and SOFTEX in sub regulation (C).

Non-resident hedging: authorisation to enter forex derivative contracts on behalf of Indian subsidiary, subject to regulatory terms.
The amendment permits a non-resident to enter into a foreign exchange derivative contract with an Authorised Dealer bank in India to hedge exchange-rate exposure of, and on behalf of, its Indian subsidiary, strictly for the subsidiary's transactions and subject to regulatory terms and conditions, effected by insertion in Schedule II and brought into force on publication in the Official Gazette.

E-commerce FDI rules: marketplace and B2B models allowed automatically while inventory-based e-commerce remains restricted.
The amendment defines e-commerce entities and distinguishes inventory based and marketplace models for FDI purposes, permitting full FDI under the automatic route for B2B and marketplace models while prohibiting FDI in inventory based e-commerce. Marketplace platforms must not own inventory, may transact with registered sellers on a B2B basis, provide support services, disclose seller details, avoid influencing prices, and limit annual sales from a single vendor to twenty-five percent; sale of services online is automatic subject to sectoral conditions and applicable laws.

FDI in LLPs permitted under automatic route with valuation, payment and reporting requirements for foreign investors.
The notification permits FDI in LLPs by eligible non-resident persons or entities (excluding Pakistan/Bangladesh) via capital contribution or acquisition/transfer of profit shares under the automatic route in sectors allowing full foreign investment without FDI-linked conditions; investments must comply with the LLP Act. Pricing must meet a fair price determined by accepted valuation norms with an appropriate certificate; payments are by inward remittance or specified NRE/FCNR(B) accounts. Reporting and annual RBI return obligations apply.

Compounding Authority jurisdiction curtailed: serious contraventions suspected of money laundering or terror financing must be remitted for adjudication.
The amendment adds a proviso that when the Enforcement Directorate considers a proceeding under rule 4 to involve a serious contravention suspected of money laundering, terror financing, or affecting sovereignty and integrity, the Compounding Authority shall not proceed and must remit the case to the appropriate Adjudicating Authority for adjudication of the contravention.

Foreign investment in securities market infrastructure now allowed under automatic route, subject to SEBI and RBI guidelines.
Amendment to Schedule 1 substitutes Paragraph F.4 to designate Infrastructure Company in the Securities Market-including stock exchanges, commodity derivative exchanges, depositories and clearing corporations-as eligible for foreign investment under the automatic route subject to SEBI Regulations and Guidelines/Regulations issued by the Central Government, SEBI and the Reserve Bank; terms not defined in these regulations adopt meanings from relevant statutes and SEBI regulations. The amendment deletes the former Paragraph F.6 and renumbers subsequent paragraphs, effective on publication in the Official Gazette.

Convertible notes issuance by non-residents permitted with conditions on sectoral approval, remittance, escrow closure, transfers, reporting.
The amendment defines a convertible note and adds Regulation 6D allowing non residents (with specified nationality exclusions) to purchase convertible notes of Indian startups subject to minimum tranche requirements, government approval where the sector is restricted, receipt of consideration by inward remittance or specified accounts with escrow closure within six months, NRI non repatriation conditions, permitted transfers under RBI pricing guidelines and reporting obligations to the Reserve Bank.

Prohibition on direct overseas investment bars Indian parties from investing in entities located in FATF non-cooperative jurisdictions.
Amendment adds clause (vii) to Regulation 6(2) prohibiting Indian parties from making direct investments in overseas entities set up or acquired as joint ventures, wholly owned subsidiaries, or step down subsidiaries located in jurisdictions identified by the FATF as non cooperative, according to the FATF list or as notified by the Reserve Bank of India.