RBI-Foreign Direct Investment in Financial Sector Transfer of Shares
November, 12th 2013
RBI/2013-14/366 A. P. (DIR Series) Circular No.72
November 11, 2013
All Category-I Authorised Dealer Banks
Madam / Sir,
Foreign Direct Investment in Financial Sector – Transfer of Shares
Attention of Authorized Dealer Category-I (AD Category-I) banks is invited to Regulation 10(A)(v) of the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000 notified vide Notification No. FEMA.20/2000-RB dated May 3, 2000, as amended from time to time and Para 2(B)(iv) of A.P.(DIR Series) Circular No.43 dated November 4, 2011, in terms which for transfer of shares from Residents to Non-Residents where the investee company is in the financial services sector, No Objection Certificate (NoC) is required to be obtained from the respective financial sector regulator/regulators of the investee company as well as transferor and transferee entities and such NoC(s) are to be filed with the form FC-TRS to the AD bank.
2. On a review, it has now been decided that the requirement of NoC(s) will be waived from the perspective of Foreign Exchange Management Act, 1999 and no such NoC(s) need to be filed along with form FC-TRS. However, any 'fit and proper/ due diligence' requirement as regards the non-resident investor as stipulated by the respective financial sector regulator shall have to be complied with.
3. All the other instructions contained in the above referred A.P.(DIR Series) Circular shall remain unchanged.
4. AD Category – I banks may bring the contents of the circular to the notice of their customers/constituents concerned.
6. The directions contained in this circular have been issued under Sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.
(Rudra Narayan Kar) Chief General Manager-in-Charge
RESERVE BANK OF INDIA FOREIGN EXCHANGE DEPARTMENT CENTRAL OFFICE MUMBAI-400 001
Dated : October 04, 2013
Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) (Fourteenth Amendment) Regulations, 2013
In exercise of the powers conferred by clause (b) of sub-section (3) of Section 6 and Section 47 of the Foreign Exchange Management Act, 1999 (42 of 1999), the Reserve Bank of India hereby makes the following amendments in the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000 (Notification No. FEMA 20/2000-RB dated 3rd May 2000), hereinafter referred to as 'the principal Regulations,' namely:-
1. Short Title & Commencement:-
(i) These Regulations may be called the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) (Fourteenth Amendment) Regulations, 2013.
(ii) They shall come into force from the date of their publication in the Official Gazette.
2. Amendment of Regulation 10
In the Principal Regulations, in Regulation 10A(b)(v), clause (a) shall be deleted.
(C.D. Srinivasan) Chief General Manager
The Principal Regulations were published in the Official Gazette vide G.S.R. No.406 (E) dated May 8, 2000 in Part II, Section 3, sub-Section (i) and subsequently amended as under:-