TaxTMI 
TaxTMI 
Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) (Second Amendment) Regulations, 2008
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....e of Security by a Person Resident Outside India) (Second Amendment) Regulations, 2008. (ii) Save as otherwise provided in these Regulations, the provisions of these Regulations shall come into force from the date of their publication in the Official Gazette. 2. Amendment of Regulation 2 - In the Foreign Exchange Management (Transfer or issue of Security by a Person Resident Outside India) Regulations 2000, (Notification No. FEMA 20/2000-RB dated 3rd May, 2000) (hereinafter referred to as 'the principal Regulations'), in Regulation 2, (A) for clause (ii), the following clause shall be substituted and shall be deemed to have been substituted with effect from the 1st day of May 2007, namely:- "(ii) 'Capital' means equity shares, preference shares and convertible debentures (B) after clause (iia), the following new clause shall be inserted and shall be deemed to have been inserted with effect from 1st day of May 2007, namely:- "(iib) 'preference shares' mean compulsorily and mandatorily convertible preference shares." (C) after clause (iib) as so inserted, the following new clause shall be inserted and shall be deemed to have been inserted with effect from the 8th....
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....proposes acquire the entire shareholding of a new Indian company, he should obtain prior permission of Central Government if he has, as on January 12, 2005, an existing joint venture or technology transfer/trademark agreement in the same field as that of such Indian company." (b) after sub-paragraph (2) the following provision shall be inserted and shall be deemed to have been inserted with effect from the 12th day of January 2005, ^[1] namely:- "Provided that no prior permission of Central Government shall be required for investments to be made by Venture Capital Funds registered with. SEBI; investment by multinational., financial institutions; or where in the existing joint-venture investment by either of the parties is less than 3% or where the existing joint Venture/ collaboration is defunct or sick or for transfer of shares of an Indian company engaged in Information Technology sector or in the mining sector, if the existing joint- venture or technology transfer/trade mark agreement of the person to Whom the shares are to be transferred are also in the information Technology sector or in the mining sector or in the mining sector for same area/mineral". (ii) in paragra....
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...." form specified in Annexure C", the words "Form DR" shall be substituted. (ii) in sub-paragraph (3), for the words "form specified in Annexure D", the words "Form DR-Quarterly" shall be substituted. (vii) for paragraph 4B, the following new paragraph shall be substituted namely: "4B An Indian company may sponsor an Issue of ADRs/GDRs with an overseas depository against Shares held by its shareholder at a price to be determined under the provisions of the Scheme for Issue of Foreign Currency Convertible Bonds and Ordinary Shares (Through Depository Receipt Mechanism) Scheme 1993 and guidelines issued by the Government of India and the reporting requirements as directed by Reserve Bank, from time to time.' (viii) paragraph 5A shall be omitted. (ix) for paragraph 6, the following new paragraph shall be substituted, namely "6. Issue price of ADRs/GDRs The pricing of ADRs/GDRs to be issued to a person resident outside India shall be determined under the provisions of the Scheme for Issue of Foreign Currency Convertible Bonds and Ordinary Shares (Through Depository Receipt Mechanism) Scheme, 1993 and guidelines issued by the Government of India from time to time." ....
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....ial institutions or where in the existing joint-venture investment by either of the parties is less than 3%; or where the existing joint venture/collaboration is defunct or sick." 8. Amendments of Schedule 5 In the principal Regulations, in Schedule 5, (i) for paragraph 1, the following new paragraph . shall be substituted, namely:- 1. Permission to Foreign Institutional Investors for purchase of securities- A registered, Foreign Institutional. Investor may purchase on repatriation basis, dated Government securities/treasury bills, listed non-convertible. debentures/bonds; commercial paper issued by an Indian company and units of domestic mutual funds, Security Receipts issued by Asset Reconstruction Companies and Perpetual Debt instruments eligible for inclusion as Tier I capital and Debt capital instruments as upper Tier II capital issued banks in India to augment their capital (the definitions of Tier I capital and Tier, II capital Will be the same as clarified by Reserve Bank, Department of Banking Operations and Development and modified from time to time); subject to the limits prescribed by RBI and SEBI from time to time; either direct from the issuer of such s....
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....o augment their capital, as stipulated by Reserve Bank from time to time. The investments by all NRIs in Perpetual Debt instruments (Tier I) should not exceed an aggregate ceiling of 24 per cent of each issue and investments by a single NRI should not exceed 5 percent of each issue. Investment by NRIs in Debt capital instruments (Tier II) shall be in accordance with the extant policy for investment by NRIs in other debt instruments. ' [No. FEMA l79/2008-RB] SALIM GANGADHARAN, Chief General Manager Foot Note: The Principal Regulations were published in the Official Gazette vide G.S.R.No. 406 (E) dated May 8, 2000 in Part II, Section 3, sub-section (i) and subsequently amended as under: G.S.R.No. 158(E) dated 02.03.2001 G.S.R.No. 175(E) dated 13.03.2001 G.S.R.No. 182(E) dated 14.03.2001 G.S.R.No. 4(E) dated 02.01.2002 G.S.R.No. 574(E) dated 19.08.2002 G.S.R.No. 223(E) dated 18.03.2003 G.S.R.No. 225(E) dated 18.03.2003 G.S.R.No. 558(E) dated 22.07.2003 G.S.R.No. 835{E) dated 23.10.2003 G.S.R.No. 899(E) dated 22.11.2003 G.S.R.No. 12(E) dated 07.01.2004 G.S.R.No. 278(E) dated 23.04.2004 G.S.R.No. 454(E) dated 16.07.2004 &n....
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....ior approval of State Government concerned in case of any change in future land use. INDUSTRY MINING 3. Mining covering exploration and mining of diamonds & precious stones; gold, silver and minerals. 100% Automatic Subject to Mines & Minerals (Development Regulation) Act, 1957 (www.mines.nic.in) Press Note 18 (1998) and Press Note 1 (2005) are not applicable for setting up 100% owned subsidiaries in so far as the mining sector is concerned Subject to declaration from the applicant that he has no existing joint venture for the same area and / or the particular mineral. 4. Coal & Lignite mining for captive consumption by power projects and iron & steel, cement production and other eligible activities permitted under the Coal Mines (Nationalisation)Act, 1973. 100% Automatic Subject to provisional of Coal Mines (Nationalization) Act, 1973. (www.coal.nic.in) 5. Mining and mineral separation of titanium bearing minerals and ores, its value addition and integrated activities, NB: FDI will not be allowed in mining 0f "prescribed substanc....
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....(www civilaviation.nic.in) 14. Air Transport Services including Domestic Scheduled Passenger Airlines; Non-Schedules Airlines; Chartered Airlines; Cargo Airlines; Helicopter and Seaplane Services a. Scheduled Transport Services/Domestic Scheduled Passenger Airlines 49%- FDI; 100%- for NRIs investment. Automatic Subject to no director indirect participation by foreign airlines and sectoral Regulations. airlines, b. Non-Scheduled Air Transport Service/Non-Scheduled airlines, Chartered airlines, Cargo airlines 74%- FDI 100%- for NRIS investment Automatic Subject to no direct or indirect participation by foreign airlines in Non Scheduled and Chartered airlines. Foreign airlines, are allowed to participate in the equity of companies operating Cargo airlines. Also subject to sectoral Regulations. (www civilaviation.nic.in) c. Helicopter Services/Seaplane services requiring DGCA approval 100% Automatic Foreign airlines are allowed to participate in the equity of companies....
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....sp; FII -23% FIPB FII purchases shall be restricted to secondary market. Subject to regulations specified by concerned Regulators. 20. Construction Development projects, including housing, commercial premises, resorts, educational institutions, recreational facilities, city and regional level infrastructure; townships NB: FD is not. allowed in Real Estate Business 100% Automatic Subject to conditions notified vide Press Note 2 (2005 Series) including: a. Minimum capitalization of US$ 10 million for wholly owned subsidiaries and US$ 5 million for joint venture. The funds would have to be brought within six months of commencement of business of the Company. b. Minimum area to be developed under each project- 10 hectares in case of development of serviced housing plots; and built-up area of 50,000 sq. mts. in case of construction development project: and any of the above in case of a combination project. (Note 1: For investment by NRIs, the condition mentioned in Press Note 2 (2005) are not applicable. Note 2: For investment in SEZs, Hotels & Hospitals, conditions mentioned in Press Note 2(2005) are not a....
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....) (v) (vi) (vii) (vii) (ix) (x) (xi) (xii) (xiii) (xiv) (xv) (xvi) (xvii) (xviii) Merchant banking Underwriting Portfolio Management Services Investment Advisory Services Financial Consultancy Stock Broking Asset Management Venture Capital Custodial Services Factoring Credit Rating Agencies Leasing & Finance Housing finance Forex Broking Credit card Business Money changing business Micro credit Rural credit 100% Automatic Subject to: a. Minimum capitalization norms for fund based Underwriting NBFCs - US$ 0.5 million to be brought upfront for FDI up to51%; US$ 5 million to be brought upfront for FDI above 51% and up to 75%; and US$ 50 million out of which US$ 7.5 million to be brought upfront and the balance in 24 months, for FDI beyond 75% and up to100%. b. Minimum capitalization norms for non-fund ba....
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....%. Subject to licensing and security requirements notified by the Department of Telecommunications. (www.dotindia.com) c. (a) ISP without gateway, (b) infrastructure provider providing dark fibre, right of way, duct space, (c) electronic mail voice mail 100% Automatic up to 49%. FIPB beyond 49% Subject to the condition that such companies shall divest 26% of their equity in favour of Indian public in 5 years companies are listed in other parts of the world. Also subject licensing and security requirements, where required. (www.dotindia.com) d. Manufacture of telecom equipments 100% Automatic Subject to sectoral requirements. (www.dotindia.com) 31. Trading a Wholesale/& carry trading 100% Automatic Subject to guidelines for FDI in trading issues by Department of Industrial Policy & Promotion vide Press Note 3 (2006 Series) dated February 10,2006. b. Trading for Exports 100% Automatic -- c. Trading of items sourced from small scale 100% FIPB -- d. Test marketing of such items for which a company has approval for manufacture 1....
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....d 7. Address of the AD A copy of the FIRC evidencing the receipt of consideration for issue of shares/ convertible debentures as above is enclosed. (Authorised signatory of the AD) (Authorised signatory of the investee company) (Stamp) (Stamp) __________________________________________________________ FOR USE OF THE RESERVE BANK ONLY: Unique Identification Number for the remittance: Know Your Customer (KYC) Form in respect of the non-resident investor Registered Name of the Remitter/ Investor (Name, if the investor is an individual) Registration Number (Unique Identification Number* in case remitter is an Individual) Registered Address (Permanent Address if remitter Individual) Name of the Remitters Bank Remitter's Bank Account No. Period of banking relationship with the remitter *Passport No., Social Security No, or any. Unique No. certifying the bona fides....
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....ivate Equity Fund 7. Pension/ Provident Fund 8. Sovereign Wealth Funds ^[4] 9. Partnership/ Proprietorship firm 10.Financial Institution 11. NRIs/PIOs 12. others -(please specify)] Date of incorporation 4 Particulars of Shares/ Convertible Debentures Issued (a) Nature and date of issue Nature of issue Date of issue Number of shares/ convertible debentures 01 IPO / FPO 02 Preferential allotment / private placement 03 Rights 04 Bonus 05 Conversion of ECB 06 Conversion of royalty (including lump sum payments) 07 Conversion against import of capital goods by units in SEZ 08 ESOPs 09 Share Swap 10 Others (Specify) Total (b) Type of security issued No. Nature of security Number Maturity Face value Premium Is....
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....03 FIIs 04 FVCIs 05 Foreign Trusts 06 Private Equity Funds 07 Pension/ Provident funds 08 Sovereign Wealth Funds 09 Partnership/ Proprietorship firms 10 Financial Institutions 11 NRIs/PIOs 12 Others (Please specify) Sub Total b) Resident Total DECLARATION TO BE FILED BY THE AUTHORISED REPRESENTATIVE OF THE INDIAN COMPANY: (Dele....
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....ccordance with paragraph 8 of Schedule 1 to Notification No. FEMA 20/2000-RB dated 3^rd May, 2000. (ii) A certificate from Statutory Auditors/ Chartered Accountant indicating the manner of arriving at the price of the shares issued to the persons resident outside India. 5. Unique Identification Number given for all the remittances received as consideration for issue of shares/ convertible debentures (details as above),by RBI: R (Signature of the Applicant)* : _________________________________ (Name in Block Letters) : _____________________________________ (Designation of the signatory):__________________________________ Place: Date: (* To be signed by Managing Director/Director/Secretary of the Company) CERTIFICATE TO BE FILED BY THE COMPANY SECRETARY ^[5] OF THE INDIAN COMPANY ACCEPTING THE INVESTMENT: (As per Para 9(1) (B) (i) of Schedule 1 to Notification No. FEMA 20/2000-RB dated 3^rd May, 2000) In respect of the above-mentioned details, we certify the following: 1. All the requirements of the Compa....
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.... 3. Account closing date: 4. Details of changes if any, with regard to information furnished earlier (Change in name of company/ Change of location, activities, etc.) 5. Whether listed company or unlisted company Listed/ unlisted 5.1 If listed, i) Market value per share as at end-March ii) Net Asset Value per share as or date of latest Audited Balance Sheet 5.2 If unlisted, Net Asset Value per share as on date of latest Audited Balance-Sheet 6. Foreign Direct Investment (FDI) Amount in Lakhs of Rupees Foreign Liabilities in India* Foreign Assets Outside India ^"&" Outstanding at end- March of Previous Year Outstanding at end-March of Current Year Outstanding at end- March of Previous Year Outstanding at end-March of Current Year 6.0 Equity Capital 6.1 Other Capital Ω 6.2 Disinvestments during the year &....
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.... 04 FVCIs 05 Foreign Trust 06 Private Equity Funds 07 Pension/Provident Funds 08 Sovereign Wealth Funds ^[6] 09 Partnership/Proprietorship 10 Financial Institution 11 NRIs/PIOs 12 Other (please specify) Sub Total b) Resident Total 11. Persons employed during the financi....
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....f persons on the roll of your company. whereas under "Indirectly", indicate the number of persons otherwise engaged by your company during the year. Form DR [Refer to paragraph 4(2) of Schedule 1] Return to be filed by an Indian Company who has arranged issue of GDE/ADR Instructions.: The form should be completed and submitted to the Reserve. Bank of India, Foreign Investment Division, Central Office, Mumbai, 1. Name of the Company 2. Address of Registered Office 3. Address for Correspondence 4. Existing Business (please give the NIC Code of the activity in which the company is predominantly engaged) 5. Details of the purpose for which GDRs/ADRs have been raised. If funds are deployed for overseas investment, details thereof 6. Name and address of the Depository abroad 7. Name and address of the Lead/ Manager investment/Merchant Banker 8. Name and address of the Sub-Manager the issue 9. Name and address of the Indian-Custodians 10. Details of FIPB approval (please quote the relevant NIC Code if the GDRS are being issued under the Automatic Route) 11. Whether any overall sectoral cap for foreign investment is applicable. If yes, ple....