I would like to add for FDI, RBI issues a Master Circular on 1st Day of July each year with sunset clause of one year. It is the combination of all the provisions of FEMA and RBI and serve all the purpose and is very helpful.

Hi

I agree with Ankur, he is righlty said that the RBI on every Jauly 01, issued MSTER CIRCULAR on FDI and also othe matter which is compilation of all amendements made between these two master circulars.

But last two times, Ministry of Commerce and Insustry, Deparment of Industrial Policy & Promotion (DIPP) (FC Section) also issued "Consolidated FDI Policy".

For more details go to the following link:

https://dipp.nic.in/English/policies/FDI_Circular_02_2011.pdf

Regards

Dear Neha,

Here you should thank to Ajay ji.....

Ok.. Miss SG... :) Anyways nice Article....

Thanks to SS and SG...................................

It is ours pleasure Ajay ji...

Thanks a lot for such a wonderful Article.

Thank you Very much

Thank You very much for sharing FDI  informations .

Sir,

Pls tell me, do we require to file FCGPR for first subscripttion of shares of an 'Foreign WOS' company in India.

Foreign directors of parent company hv become the direcotors and shareholders of its WOS company in India and they have sent money for first subscripttion of shares.

Besides, before-during-after formation of foreign WOS in india, do the parent company, indian company or anybody else require to inform to RBI ? If yes, then how and in which form ?

Hi Ms. Sridhi

If a Foreifgn person making investment  in India in capital of the company then you should always comply the Reporting section as given in my article on FDI.

For subscriptttion of MOA/AOA please read following for your knowledge:

NON-RESIDENT INDIAN AS SUBSCRIBER TO THE MOA/AOA

The Reserve Bank of India had given general permission under section 29(1)(b) of the former FERA, 1973 to NRI to subscribe to the MOA of an Indian company and to take shares as a subscriber .(Notification No. FERA 143/93-RB, dated 26-4-1993 issued by RBI, Mumbai in this regard is reproduced hereunder:

“The RBI has given general permission to NRI to subscribe to the MOA/AOA of Indian Company for the purpose of Incorporation of the company subject to the condition that:-

(a)               the total face value of the shares to be taken by NRI does not exceed Rs. 10,000

(b)               the company is being manly formed  for undertaking industrial activities

(c)                the MOA of such company does not permit the company to take up any agriculture/plantation activities  and to deal in real estate business other than developing real estate, and

(d)               such company shall file a declaration in the prescribed form with the RBI regarding particular of such shares issued within 900days from the date of incorporation of the company.

DCA Circular dated 16-2-1995 clarifies that there can not  be any restriction for incorporation of a company whether all the subscriber to the MOA/AOA/  proposed directors are residing abroad, being either foreign nationals, or NRI subject to the approval of RBI, where necessary.

The RBI may issue such a general permission also under FEMA, 1999 also. The FEMA(Permissible Capital Account Transactions) Regulations, 2000 allow persons resident outside India to invest in an issue of security by body corporate or an entity in India.

Thanks sir for such a useful info.

In my case, ours is a pvt. ltd. co. which is 100% WOS of Egyptian co. The company was incorporated around 3-4 years back.

My responsibility is to check whether all FEMA compliance have been met or not.

I think WOS is liberal in shareholding by foreigners as all shares goes to its parent co.

Can u pls suggest me the points to remember ?

Hi Shridhi

I will suggest you to read circulars and master circulars issued and to be issued by RBI time to time. I will also informed you time to time any update on the same accordingly.