TaxTMI 
TaxTMI 
International Financial Services Centres Authority (Finance Company) Regulations, 2021
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.... a) "Act" means the International Financial Services Centres Authority Act, 2019 (50 of 2019); b) "Aircraft Lease" includes operating and financial lease and any hybrid of operating and financial lease of aircraft or helicopter and engines of aircraft or helicopter or any other part thereof; c) "Authority" means the International Financial Services Centres Authority established under sub- section (1) of section 4 of the Act; d) "Banking Unit" shall have the same meaning as assigned to it under clause (c) of sub-regulation (1) of regulation 2 of the International Financial Services Centres Authority (Banking) Regulations, 2020; e) "Finance Company" means a financial institution as defined under clause (c) of sub-section (1) of section 3 of the Act, separately incorporated to deal in one or more of the permissible activities specified under sub-regulation (1) of regulation 5 of these regulations, provided: (i) It does not accept public deposit from resident and non-resident, as defined in these regulations; and (ii) It is not registered with the Authority as a Banking Unit; f) "Finance Unit" means a financial institution....
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....Finance Company or Finance Unit, as the case may be, in International Financial Services Centres (IFSCs) only after obtaining a certificate of registration from the Authority for carrying out the activities specified in Schedule to these regulations. (2) A Finance Company can be set up either as a subsidiary or a joint venture, or as a newly incorporated company under the Companies Act, 2013, or in any other form as may be specified by the Authority from time to time: Provided that if an investing entity in a Finance Company is carrying out a regulated financial activity in its home jurisdiction, it shall obtain a No-objection Certificate from its home country regulator for setting up a Finance Company in the IFSCs, wherever applicable. (3) A Finance Unit can be set up if the investing entity or the ultimate parent of the investing entity, as the case may be, is carrying out a regulated financial activity in its home jurisdiction and has obtained the No-Objection Certificate from the home country regulator for setting up a Finance Unit in the IFSCs. (4) An application for grant of registration as a Finance Company or a Finance Unit, as the case may be, shall be ma....
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....opinion that registration cannot be granted, it shall communicate the deficiencies to the applicant giving it thirty days‟ time to rectify them. (9) If the applicant fails to rectify such deficiencies to the satisfaction of the Authority within the specified time, the Authority may refuse to grant certificate of registration and shall communicate the same to the applicant, giving reasons for such refusal: Provided that no such refusal shall be made by the Authority without giving the applicant an opportunity to make written submissions on the grounds on which the registration is proposed to be refused. CHAPTER III PRUDENTIAL REGULATORY REQUIREMENTS 4. Applicable prudential regulations (1) The prudential regulations applicable to a Finance Company or a Finance Unit, as the case may be, shall be such as may be specified by the Authority. (2) Capital Ratio (CR) A Finance Company or a Finance Unit, as the case may be, shall maintain a minimum capital ratio at eight per cent of its regulatory capital to its risk-weighted assets or at such percentage as may be specified by the Authority. (3) Liquidity Coverage Ratio (LCR) A Finance Company or a F....
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....tion of mutual fund units; (h) Distribution of insurance products; (i) Function as trading and clearing members or professional clearing member of exchanges and clearing corporations set up in IFSC; (j) Transactions permitted under the Framework for Aircraft Operating Lease, as specified by the Authority; (k) Transactions permitted under the Framework for Ship Operating Lease, as may be specified by the Authority; (l) Asset Management support services permitted under the Framework for Enabling Ancillary Services as specified by the Authority, (m) any other non-core activity, as may be permitted with prior approval of the Authority. (2) A Finance Company or a Finance Unit intending to undertake aircraft lease transactions shall be in conformity to the Cape Town Convention and Protocol. (3) A Finance Company or a Finance Unit intending to undertake either a single or a combination of non-core activities, shall fulfil the following conditions: (a) It shall carry out each such activity through separately identifiable department (SID); (b) It shall ensure a fire wall between various non-core activities so that....
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....equirements, including reporting requirements, as specified for a Banking Unit in IFSCs. 8. Corporate Governance and Disclosure Requirements (1) Every Finance Company and Finance Unit shall adhere to the guidelines on corporate governance and disclosure requirements to be specified by the Authority. (2) Any mergers, acquisitions, takeovers or change in management of a Finance Company, which results in its change in control of at least twenty per-cent. of total share capital, or of business decisions under an agreement, shall be subject to prior approval and such other requirements as may be specified by the Authority: Provided that mergers, acquisitions, takeovers or change in management in the parent of a Finance Unit shall be in compliance to its registration requirements and shall be intimated to the Authority within a period of 15 days from the date of such event. 9. Reporting Requirements (1) Every Finance Company and Finance Unit shall furnish information relating to its operations to the Authority, in such manner, interval and form, as may be specified by the Authority. (2) Every financial reporting by a Finance Company and a Finance Unit to the Authorit....