Reserve bank of India (RBI)
Vide its notification dated January 10, 2017, RBI has made the following amendments to the in the Foreign Exchange Management (Transfer or issue of Security by a Person Resident outside India) Regulations, 2000:
- Regulation 2 – the definition of “convertible note” has been added
- Insertion of new regulation 6C regarding terms of issue of convertible notes by startup companies
For further details, please refer to the link of the above-mentioned regulations
Vide its notification dated January 10, 2017, RBI has made further amendments to the Foreign Exchange Management (Transfer or issue of Security by a Person Resident outside India) Regulations, 2000 as follows:
a. Schedule I – Annexure B - Sectoral cap on Investments by Persons Resident Outside India
The existing Paragraph F.4 shall be substituted by the following namely:-
“F.4 | Infrastructure Company in the Securities Market | ||
F.4.1 | Infrastructure companies in Securities Markets, namely, stock exchanges, commodity derivative exchanges, depositories and clearing corporations, in compliance with SEBI Regulations. | 49% | Automatic |
F.4.2 | Other Conditions: | ||
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In order to align, the instructions with the objectives of FATF, on a review, it has been decided to prohibit an Indian Party from making direct investment in an overseas entity (set up or acquired abroad directly as JV/ WOS or indirectly as step down subsidiary) located in the countries identified by the FATF as “non co-operative countries and territories” as per list available on FATF website www.fatf-gafi.org or as notified by the Reserve Bank of India from time to time.
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