TaxTMI 
TaxTMI 
Security for External Commercial Borrowings
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....) Circular No. 5 dated August 1, 2005 and A P (DIR Series) Circular No. 1 dated July 11, 2008 relating to creation of charge over securities for External Commercial Borrowings (ECB). 2. Under the extant ECB guidelines, the choice of security to be provided to the overseas lender / supplier for securing ECB is left to the borrower. With a view to liberalising, expanding the options of securities a....
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....icate, wherever necessary, from the existing lenders in India has been obtained. 3. Once aforesaid stipulations are met, the AD Category-I bank may permit creation of charge on immovable assets, movable assets, financial securities and issue of corporate and / or personal guarantees, during the currency of the ECB with security co-terminating with underlying ECB, subject to the following: (a) Cr....
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....anding claim against the ECB. Encumbered movable assets may also be taken out of the country. (c) Creation of Charge over Financial Securities * Pledge of shares of the borrowing company held by the promoters as well as in domestic associate companies of the borrower will be permitted. Pledge on other financial securities, viz. bonds and debentures, Government Securities, Government Savings Cer....
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....reign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000. (d) Issue of Corporate or Personal Guarantee * A copy of Board Resolution for the issue of corporate guarantee for the company issuing such guarantee, specifying name of the officials authorised to execute such guarantees on behalf of the company or in individual capacity should be ob....