FDI Policy Clarification on After-Sale/Repair Services - FEMA - File No. 12/14/2010-FC-I

Government of India Ministry of Commerce Industry Department of Industrial Policy Promotion FDI Policy Clarification on After-Sale/Repair Services This Department has been receiving references seeking clarification on the FDI policy provisions governing the treatment of after-sale/repair services. In this regard, it is hereby clarified that: After-sale/Repair services are covered under Para 5.2 (a) of Consolidated FDI Policy Circular of 2017 , as amended from time to time, wherein 100% FDI under automatic route is permitted in sectors/activities which are not specifically mentioned in the extant policy, subject to applicable laws/regulations; security and other conditionalities. After-sale/Repair services involve a combination of a service component and goods component, and include activities which are naturally combined/bundled in the ordinary course of business. The defining characteristic of such after-sale/repair services shall be that any sale of goods such as spare parts/accessories etc. is naturally bundled together in the ordinary course of service provision. It is further clarified that any standalone sale of spare parts/accessories etc. shall be construed as retail trading for the purposes of FDI policy. (Reetu Jain) Director DIPP. File No. 12/14/2010-FC-I, dated 22.12.2017