Foreign Investment into India might be brought in by an individual to start a company or for a joint venture in India by a corporate/MNC from abroad, the crucial point is that the investment should be accompanied by legal compliances. In India, still there are many sectors which have limits (ceilings) on investment and they require certain approval
Foreign Investment into India might be brought in by an individual to start a company or for a joint venture in India by a corporate/MNC from abroad, the crucial point is that the investment should be accompanied by legal compliances. In India, still there are many sectors which have limits (ceilings) on investment and they require certain approvals of Boards, Reserve Bank and Authorities based on the Foreign Direct Investment (FDI) policy of India. However, most of the requirement related to manufacturing units is allowed without reporting requirements of RBI.
Further, foreign Investor/international companies need to understand the nuances of Indian law before investing as it will protect and safeguard the investment made. The valuation of the investment & whether reparability [i.e, taking back the benefit of investment] is allowed also plays a crucial role which needs to be analysed & understood before making such investments.
The most preferred form of investment into India is into company’s (ending with the words Ltd or Private Ltd) equity or convertible equity share capital, which also requires compliance under relevant company laws and listing agreement, if any.
We help foreign Investor/ international companies to invest into India by guiding the appropriate route & sharing our knowledge of Indian business practice and rules. We have developed customized solutions through following bouquet of services.
Routing & Structuring Of Investment
- Strategy (will vary on case to case basis depending on Sectoral Ceilings & Industry):
- Opinion on sectoral caps and the investment ceilings considering various requirements
- Routing & manner of investment into India through banks or different types of accounts
- Company law requirements, reporting and compliances on classification of various types of share capital
- Other investment related approvals under FEMA, if any
Share capital investments reporting under automatic route [Rs.40,000 per investment *]
- Procedure: Allotment of shares or debentures (Event Based)
- Certification: Reporting of foreign exchange inflows & allotments, including a CA & CS certificate for valuation & compliance of procedure respectively (Event Based)
- Compliance: Annual reporting on foreign assets & liabilities of the company for one year (Periodical)
Approval route Package (will vary on case to case basis depending on Sectoral Ceilings & Industry):
- Strategy: Structuring of foreign exchange inflow as Equity or convertible equity and the purpose of utilization (Opinion)
- Preparation: Preparation of application and applying for approval based on the agreed terms and conditions (Event Based)
- Certification: Pooling of necessary certified true copies of document as required on a case-to-case basis
- Compliance: Timely reporting for one year (Periodical)
