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The Reserve Bank of India amends the Foreign Exchange Management regulations to revise rules for overseas direct investments by proprietorship concerns and unregistered partnership firms. A proprietorship concern or an unregistered partnership firm in India may set up or acquire a joint venture or wholly owned subsidiary outside India. The entity must satisfy the criteria prescribed by the Reserve Bank and must obtain prior approval from the Reserve Bank. The Reserve Bank also deletes Schedule II from the principal regulations.
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Relative A.P. (DIR) circular: 59/22.01.15
RESERVE BANK OF INDIA FOREIGN EXCHANGE DEPARTMENT CENTRAL OFFICE MUMBAI-400 001
Notification No. FEMA. 325/RB-2014
November 12, 2014
Foreign Exchange Management (Transfer or Issue of any Foreign Security) (Fourth Amendment) Regulations, 2014
In exercise of the powers conferred by clause (a) of sub-section (3) of Section 6 and sub-section (2) of Section 47 of the Foreign Exchange Management Act, 1999 (42 of 1999), the Reserve Bank hereby makes the following amendments in the Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations 2004 (Notification No. FEMA.120/RB-2004 dated July 7, 2004), as amended from time to time, (hereinafter called the Principal Regulations or the Notification) namely:-
“19A. Overseas Direct Investments by Proprietorship Concern / Unregistered Partnership Firm in India
A proprietorship concern or an unregistered partnership firm in India, satisfying the criteria for Overseas Direct Investment as prescribed by the Reserve Bank from time to time, may set up / acquire a Joint Venture (JV) / Wholly Owned Subsidiary (WOS) outside India with the prior approval of the Reserve Bank.”
(C D Srinivasan) Chief General Manager
Foot Note: The Principal Regulations were published in the Official Gazette of GOI vide G.S.R. No 757 (E) dated November 19, 2004 – in Part II, Section 3, Sub-section (i) and subsequently amended vide:- G.S.R. No. 220 (E) dated April 7, 2005, G.S.R. No. 337 (E) dated May 27, 2005, G.S.R. No. 552 (E) dated August 31, 2005, G.S.R. No. 535 (E) dated September 6, 2006, G.S.R. No.13 (E) dated January 5, 2008, G.S.R. No. 209(E) dated March 25, 2008, G.S.R. No.676 (E) dated September 24, 2008, G.S.R. No.756 (E) dated October 31, 2008, G.S.R. No.108 (E) dated February 20, 2009, G.S.R. No. 301(E) dated May 1, 2009, G.S.R. No. 441(E) dated June 23, 2009, G.S.R. No. 609(E) dated August 28, 2009, G.S.R. No. 607(E) dated August 3, 2012, G.S.R. No. 609(E) dated August 3, 2012, G.S.R. No. 947(E) dated December 31, 2012, G.S.R. No. 345(E) dated May 29, 2013, G.S.R. No. 516(E) dated July 30, 2013, G.S.R. No. 529(E) dated August 05, 2013, G.S.R. No. 552(E) dated August 14, 2013, G.S.R. No. 323(E) dated May 07, 2014 G.S.R. No. 489(E) dated July 11, 2014 and G.S.R. No. _____ dated ___________
Published in the Official Gazette of Government of India – Extraordinary – Part-II, Section 3, Sub-Section (i) dated 05.01.2015- G.S.R.No.7(E)
