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Transfer of shares between non residents

Kalpana Gupta (Company Secretary) (66 Points)

12 September 2011

Dear All,

Can some one please tell me the procedure to transfer the shares of an Indian Company from one foreign national to another foreign national.

I understand that no RBI approval or intimation is required since, the transfer is only between the foreign nationals.

Regards,

Kalpana Gupta

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3 Replies

CA. Anuj Gupta (Practices in NRI Int.Tax FEMA TP FDI/FIPB & FCRA) (7019 Points)
Replied 16 October 2011

I feel there is no compulsion to intimate RBI about transfer of shares in a Indian company from NR to another NR.The simple logic is there is no money coming into India from overseas through banking channels.

However there shall be liabillity of Foreign National purchasing shares to deduct TDS on the amount of Capital Gains. Great care needs to be taken before fixing the value of shares being transferred as provisions of sec. 56(vii) may kick in.

Anuj

+91-9810106211

femaquery @ gmail.com

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Akansha Rathi (Practising Company Secretary ) (27 Points)
Replied 19 March 2012

Hello Anuj Sir,

I have a specfic query and wanted your guidance on resolving the matter.

One Company established as a wholly owned subsidiary of a foreign company in India now desires to transfer all its shares to 2 US nationals.

Wanted to know whether it is permissible and if yes, what is the procedure??

Thanks and regards,

CS Akansha Rathi

09764240849

Deipti (Partner) (39 Points)
Replied 03 April 2012

Sir,

Have a similar query one of the pvt. ltd. company in which 63% stake is held by foreign entity.The foreign entity wamts to sell 5% capitalstake to any foreign entity.

Pls guide what are the things which i need to consider before initialtong this.

What will be the roles and responsibilities at companies end before registering the transfer.