Foreign Exchange Management (Transfer or Issue of Any Foreign Security) (Fourth Amendment) Regulations, 2012 - Amendment in Regulations 6 & 15 and Part I of Form ODI - 249/RB-2012 - Foreign Exchange Management

RESERVE BANK OF INDIA (Foreign Exchange Department) (CENTRAL OFFICE) NOTIFICATION Mumbai, the 25 th September, 2012 Foreign Exchange Management (Transfer or Issue of Any Foreign Security) (Fourth Amendment) Regulations, 2012 - Amendment in Regulations 6 15 and Part I of Form ODI G.S.R. 947(E),- In exercise of the powers conferred by clause (a) of sub-section (3) of section 6 and sub-section (2) of 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 Any Foreign Security ) Regulations, 2004 ( Notification No. FEMA 120/RB-2004, dated July 7, 2004 ), as amended from time to time (hereinafter called the Principal Regulations or the Notification), namely :- 1. Short Title Commencement ( i ) These regulations shall be called the Foreign Exchange Management (Transfer or Issue of Any Foreign Security) (Fourth Amendment) Regulations, 2012. ( ii ) Each amendment shall be deemed to have come into force from the dates specified in these regulations. Amendment to Regulation 6 2. In regulation 6, in sub-regulation (2), in clause (i), after sub-clause(e), for the words "Notwithstanding anything contained in these Regulations, investment in Pakistan shall not be permitted.", the following shall be substituted and the same shall be deemed to have come into effect from September 7, 2012: "Overseas direct investment by an Indian Party in Pakistan shall henceforth be considered under the approval route under regulation 9 of this Notification." 3. Amendment to Regulation 15 ( a ) In regulation 15, in sub-regulation (iii), for the words, "submit to the Reserve Bank through the Authorised Dealer every year within 60 days from the date of expiry of the statutory period as specified by the respective laws of the host country for finalization of the audited accounts of the Joint Venture/Wholly Owned Subsidiary outside India or such further period as may be allowed by Reserve Bank, an Annual Performance Report in Form ODI Part III in respect of each Joint Venture or Wholly Owned Subsidiary outside India set up or acquired by the Indian Party and other reports or documents as may be specified by the Reserve Bank from time to time.", the following shall be substituted and the same shall be deemed to have substituted from September 12, 2012: "submit to the Reserve Bank, through the designated Authorised Dealer, every year on or before a specified date, an Annual Performance Report (APR) in Part III of Form ODI in respect of each JV or WOS outside India, and other reports or documents as may be prescribed by the Reserve Bank from time to time. The APR, so required to be submitted, has to be based on the audited annual accounts of the JV/WOS for the preceding year, unless specifically exempted by the Reserve Bank." ( b ) In regulation 15, after the sub-regulation (iii), the following shall be added and the same shall be deemed to have been added with effect from March 15, 2011: "( iv ) Indian companies, which have made overseas direct investments under the provisions of this Notification, shall submit an 'Annual Return on Foreign Liabilities and Assets' in the format and by a specified dates prescribed by the Reserve Bank from time to time, to the Director, Balance of Payment Statistics Division, Department of Statistics and Information Management (DSIM), Reserve Bank of India, C-9, 8th Floor, Bandra Kurla Complex, Bandra (E), Mumbai - 400 051." Amendment to Part I of Form ODI 4. The Section 'E' and Section 'F' under Part I of the Form ODI , as notified vide Notification No. FEMA.180/RB-2008, dated September 5, 2008 , shall be substituted with the revised Section 'E' and Section 'F' as per the Annexure I of this amendment Notification and this substitution shall be deemed to have come into effect from August 21, 2012. Certified that no person shall be adversely affected by the retrospective effect given to such regulations. Annexure I Form ODI Part I - Revised Section 'E' and 'F' Section E (Revised): Declaration by the Indian Party ( a ) Whether the applicant party (ies), its promoters, directors, etc., are under investigations by any investigative/enforcement agency or regulatory body. If yes, the brief details thereof, including present stage of investigation/adjudication/manner of disposal of the case. ( b ) Whether the promoter Indian party (ies) is (are) presently on Exporters' Caution List of Reserve Bank for non-realization of export proceeds or on the list of defaulters to the Banking System circulated by Reserve Bank. If so, status of the Indian party (ies): ( c ) Any other information relevant to this proposal, including any special benefits/incentives available in the host country for setting up/acquiring the proposed concern. ( d ) Wherever applicable, the Annual Performance Report, as required in terms of regulation 15(iii) of the Notification No. FEMA 120/RB - 2004, dated July 7, 2004 , as amended from time to time, in respect of all the existing JV/WOS of the Indian party has been submitted. I/We hereby certify that the information furnished above are true and correct. Place: __________________ ____________________________ Date __________________ (Signature of authorised official) Name __________________ Stamp/Seal Designation __________________ List of enclosures: 1. 4. 2. 5. 3. 6. Section F (Revised): Certificate by the Statutory Auditors of the Indian Party It is certified that the terms and conditions contained in Notification No. FEMA 120/RB-2004, dated July 7, 2004 , as amended from time to time (Foreign Exchange Management (Transfer or Issue of any Foreign Security) Regulations, 2004) have been complied with by the Indian party(Name of the Indian Party) in respect of the investment under report. In particular, it is certified that: ( i ) the investment is not in real estate oriented or banking business, and ( ii ) the amount of foreign exchange proposed to be purchased for remittance towards the investment together with remittances for all overseas investments already made and exports and other dues capitalized/swap of shares/investment from ECB/FCCB balances for investment abroad under the Automatic Route is within the limit stipulated by the Reserve Bank from time to time. This has been verified with reference to the net worth of the Indian party (Name of the Indian Party) as on the date of last audited balance sheet, i.e. ..(date) ( iii ) has complied with the valuation norms prescribed for the investment ( iv ) has complied with the ECB guidelines # ( v ) that the Indian party (a) has made net profits during the preceding three years, (b) has fulfilled the prudential norms of capital adequacy as prescribed by the regulatory authority concerned; (c) has been registered with the appropriate regulatory authority in India and (d) has obtained approval for the investment in financial services sector activities from the regulatory authorities concerned in India and abroad*. Further, certified that, wherever applicable, the Annual Performance Report, as required in terms of regulation 15(iii) of the Notification ibid, in respect of all the existing JV/WOS of the Indian party has been submitted. Note: *Applicable only in cases where the investment is in the financial services sector (e.g. insurance, mutual fund, asset management, etc.). # Applicable where investment is funded through ECB/FCCB balances. (Signature of the Statutory Auditors of the Indian Party) Name of the firm, Stamp and Registration number [No. FEMA 249/RB-2012] RUDRA NARAYAN KAR, Chief General Manager Foot Note: (i) Certified that no person shall be adversely affected by the retrospective effect given to such regulations. (ii) The Principal Regulations were published in the Official Gazette of GOI vide G.S.R. No. 757 (E), dated November 19, 2004 in Part II, Section 3, sub-section (i) and subsequently amended vide :- GSR No. 220(E), dated 07.04.2005 GSR No. 337(E), dated 27.05.2005 GSR No. 552(E), dated 31.08.2005 GSR No. 13(E), dated 05.01.2008 GSR No. 209(E), dated 25.03.2008 GSR No. 676(E), dated 24.09.2008 GSR No. 756(E), dated 31.09.2008 GSR No. 108(E), dated 20.02.2009 GSR No. 301(E), dated 01.05.2009 GSR No. 441(E), dated 23.06.2009 GSR No. 609(E), dated 28.08.2009 GSR No. 607(E), dated 03.08.2012 GSR No. 609(E), dated 03.08.2012