Guidance for Finance Companies/ Units on submission of requests pertaining to changes requiring prior approval/ intimation to the Authority

[Image omitted. See the official document.]

CIRCULAR

efile No. IFSCA-FCR0FCR/5/2025-Banking/01

July 1, 2025

To: All Finance Companies / Finance Units

Dear Sir/ Madam,

Subject: Guidance on submission of requests pertaining to changes requiring prior approval/ intimation to the Authority.

1. Reference may be drawn to the International Financial Services Centres Authority (Finance Company) Regulations, 2021 (‘FC Regulations’), which requires a Finance Company/ Unit (FC/FU) to obtain prior approval or to intimate the Authority in certain cases.

2. With a view to facilitating uniformity and ease of doing business for the Regulated Entities (REs), the Authority hereby issues a ‘Guidance Note’ outlining the process to be followed by FCs/FUs for such requests and the documents to be submitted in each case. The ‘Guidance Note’ is placed as Annexure 1 to this circular. All FCs/FUs are advised to strictly adhere to same while submitting any requests to the Authority.

3. The RE shall submit its request to the respective Division of IFSCA, based on the nature of request as indicated in the table below:

Table 1: Type of request and concerned Division

4. This Circular is issued in exercise of the powers conferred under Sections 12 and 13 of the International Financial Services Centres Authority Act, 2019, to develop and regulate the financial products, financial services and financial institutions in the International Financial Services Centres.

5. The provisions of this Circular shall come into force with immediate effect.

6. A copy of this Circular is available on the website of the International Financial Services Centres Authority at https://ifsca.gov.in/Legal/Index.

Yours faithfully,

Supriyo Bhattacharjee
(Chief General Manager)
(Head - Department of Banking)

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Annexure 1

Guidance Note

• A. This document provides for the mandatory documents to be submitted by the RE for consideration of its request (s) in relation to matters outlined in Table 1 of this circular. However, the RE may submit any other documentation to support its request or as may be sought by the Authority for processing.
• B. All words and expressions used herein shall have the same meaning as assigned under the FC Regulations, unless otherwise specified.

Types of Requests and Corresponding Documentation:

1. Change in Management/control of the RE

Explanation: As per regulation 8(2) of the FC Regulations: “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 merger, 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.”

Applicability: Prior approval is required only for entities which are registered as a Finance Company and are permitted to undertake core activities. Whereas, in case of FCs permitted to undertake non-core activities, Global/ Regional Corporate Treasury Centre (GRCTC) and operating as a FU only intimation is required.

• 1.1. In view of the above regulation, the RE is required to submit the following documents for seeking prior approval for change of management/ control:
  • (i) A formal request letter¹
  • (ii) Board Resolution or other equivalent document, indicating the purpose for undertaking the change of management.
  • (iii) The new shareholding pattern and the complete group structure of the entity (which would be in effect post change of management) upto the UBO² level (UBO being a natural person).
  • (iv) The following details of the proposed promoters:
    • a. Nature of promoter:
      • i. Being an incorporated entity: Constitutional documents (CoI, AoA, MoA) and the audited financial statements of the previous three years.
      • ii. Being a natural person: Net-worth statement (not older than 6 months from the date of request).
      • iii. Being a partnership firm: Constitutional documents (i.e. partnership agreement) and the audited financial statements for the previous three years.
      • iv. Being a trust: Details on the beneficiaries of the trust and the net-worth of the trust.
      • v. Being a Fund: Details the size of the fund for the past three years, total number of investors, whether the fund is a broad-based fund and details of the anchor investor, if any, and its contribution.
    • b. Sources of funds of the proposed shareholders acquiring the shares in the RE.
  • (v) Self-certified 'Information on Management' (IOM) as per Appendix I to this Annexure, for the following individuals:
    • a. Proposed new promoters (being natural person).
    • b. Proposed additional director(s).
    • c. The UBO of the entity (being natural person), if there is any change in the UBO submitted earlier.
  • (vi) Fees: Processing fee as per provisions of the IFSCA Fee Circular³ along with copy of the SWIFT/MT103 confirming remittance of the said fees.
• 1.2. In case the change of management/ control of the entity is below 20% of the share capital, the following documents shall be submitted (this requirement flows from the condition of the Certificate of Registration (CoR) on any material change in information submitted at the time of grant of CoR):
  • (i) A formal intimation letter along with the copy of the Board resolution or equivalent document inducting the new shareholders.
  • (ii) If the change in shareholding leads to change in UBOs, Documents as at point 1.1. v. above may be sought.

2. Change of Name of RE

Explanation: If a Registered Entity (RE) changes its name, it must notify the Authority of the change. The following documents shall be submitted by the RE in such case:

• (i) A formal intimation letter from the entity on the matter
• (ii) Copy of Board resolution or equivalent document indicating the change in name of the entity.
• (iii) Copy of Certificate of Incorporation (indicating the new name of the entity) or in case of Limited Liability Partnership (LLP) the relevant constitutional document on the matter.
• (iv) Fees: Processing fee as per the applicable provisions of IFSCA Fee Circular along with copy of the SWIFT/MT103 confirming remittance of the said fees.
• (v) Revised Letter of Approval (LOA) from the IFSCA Administrator, if applicable

3. Broad banding of activities of the RE:

Explanation: The Certificate of Registration is granted to entities for undertaking specific activities and in case an entity intends to undertake any additional activity, the same may be considered as substantive change in the information submitted by the entity, if otherwise stated in this circular. Following information are to be furnished to the Authority in such cases:

Footnotes

1. All request letter shall be on the letterhead of the RE and shall be signed by the authorised person of such entity. ↩

2. Definition of UBO shall be as per Companies Act, 2013. ↩

3. Refer Circular No. IFSCA-DTFA/1/2025, titled ‘Fee structure for the entities undertaking or intending to undertake permissible activities in IFSC or seeking guidance under the Informal Guidance Scheme’ dated April 08, 2025. ↩