SCHEDULE-04 - Investment by NRI or OCI on non-repatriation basis - Foreign Exchange Management (Non-debt Instruments) Rules, 2019

SCHEDULE IV (See rule 12(2)) Investment by NRI or OCI on non-repatriation basis A. Purchase or sale of equity instruments of an Indian company or units or contribution to the capital of a LLP by Non-Resident Indian (NRI) or Overseas Citizen of India (OCI) on Non-repatriation basis. (1) Purchase or sale of equity instruments or convertible notes or units or contribution to the capital of a LLP. (a) A Non-resident Indian (NRI) or an Overseas Citizen of India (OCI), including a company, a trust and a partnership firm incorporated outside India and owned and controlled by NRIs or OCIs, may purchase or contribute, as the case may be, on non-repatriation basis the following, namely:- (i) a equity instrument issued by a company without any limit either on the stock exchange or outside it; (ii) units issued by an investment vehicle without any limit, either on the stock exchange or outside it; (iii) The capital of a Limited Liability Partnership without any limit; (iv) convertible notes issued by a startup company in accordance with these rules. (b) The investment detailed at sub-paragraph (a) of paragraph (1) above shall be deemed to be domestic investment at par with the investment made by residents. (2) Purchase or sale of units of domestic mutual funds A Non-resident Indian (NRI) or an Overseas Citizen of India (OCI) may without limit purchase or sell units of domestic mutual funds on non-repatriation basis which invest more than 50% in equity. (3) Prohibition on purchase of equity instruments of certain companies. Notwithstanding anything contained in paragraph 1, a NRI or an OCI including a company, a trust and a partnership firm incorporated outside India and owned and controlled by NRIs or OCIs, shall not make any investment, under this Schedule, in equity instruments or units of a Nidhi company or a company engaged in agricultural or plantation activities or real estate business or construction of farm houses or dealing in transfer of development rights. Explanation : Real estate business shall have the same meaning as specified in sub-paragraph (b) of paragraph (3) of Schedule 1. (4) The mode of payment and attendant conditions for remittance of sale or maturity proceeds shall be specified by the Reserve Bank. B. Investment in a firm or a proprietary concern. (1) Contribution to capital of a firm or a proprietary concern. A NRI or an OCI may invest on a non-repatriation basis, by way of contribution to the capital of a firm or a proprietary concern in India provided such firm or proprietary concern is not engaged in any agricultural or plantation activity or print media or real estate business. Explanation : Real estate business shall have the same meaning as specified in sub paragraph (b) of paragraph (3) of Schedule I. (2) The mode of payment and attendant conditions for remittance of sale or maturity proceeds shall be specified by the Reserve Bank.