June 2009
Foreign Direct Investment (FDI) in India — Transfer of Shares/Preference Shares/Convertible Debentures by way of sale — Modified Reporting Mechanism
By Pinky Shah, Sonalee Godbole, Gaurang Gandhi, Tarun Ghia, Nimesh Dedhia, Vijay Kewalramani
Chartered Accountants
Reading Time 2 mins
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Part C : RBI/FEMA
Given below are the highlights of certain RBI Circulars
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A. P. (DIR Series) Circular No. 63, dated April 22, 2009
Foreign Direct Investment (FDI) in India — Transfer of
Shares/Preference Shares/Convertible Debentures by way of sale — Modified
Reporting Mechanism
This Circular has made the following changes, with
immediate effect, in respect to reporting requirements in case of transfer of
shares/preference shares/convertible debentures by way of sale from resident
to non-resident and vice versa :
1. Form FC-TRS has been revised as per format attached to
this Circular.
2. Proforma for reporting of inflows/outflows by banks
has also been revised as per format attached to this Circular.
3. Bank receiving the remittance/handling the transaction
will have to carry out KYC non-resident purchaser as per format (Annex II)
attached to this Circular.
4. The resident transferor/transferee will have to submit
Form FC-TRS to the bank within 60 days from the date of receipt of the
amount of consideration.
5. In case of deferment of consideration (which continues
to require prior approval of RBI) the bank carrying out the transaction will
have to submit Form FC-TRS to RBI within 60 days from the date of receipt of
the full and final amount of consideration.
