NRI Investment
in Oil Fields
[RBI
Circular No. 45 dated 16th November 2011]
Sub:
Foreign Direct Investment – Reporting
of issue / transfer of ‘participating interest/right’ in oil fields to a non resident as an Foreign Direct
Investment transaction
Attention
of Authorized Dealers Category –I (AD Category-I) banks is invited to
Regulations 9 and 10 and para 9 of Schedule I to the
Foreign Exchange Management (Transfer of Issue of Security by a Person Resident
outside India) Regulations, 2000 notified vide Notification No. FEMA 20/2000-RB
dated May 3, 2000, as amended from time to time. Attention is also invited to
A.P. (DIR Series) Circular No.63 dated April 22, 2009. In terms of the said
regulations, transfer of equity shares / fully and mandatorily convertible
debentures/ fully and mandatorily convertible preference shares (hereinafter
referred to as ‘shares’) of an Indian company, from a person resident outside
India (non-resident) to a person resident in India (resident) or vice versa,
has to be reported to an Authorized Dealer bank within 60 days of transactions.
Further, the receipt of consideration for issue of shares as well as the issue
of shares of an Indian company, to a non-resident has to be reported to the
Reserve Bank of India through an Authorized Dealer bank within 30 days of the
transaction (receipt of consideration for issue of shares to a non resident or issue of shares to the non-resident).
2. It has now
been decided, in consultation with the Government, to treat the issue /
transfer of ‘participating interest/ rights’ in oil fields to a non- resident
as Foreign Direct Investment (FDI) transaction under the extant FDI policy and
the FEMA regulations. Accordingly, these transactions have to be reported as
FDI transactions in terms of the provisions of Regulations 9 and 10 of the
Foreign Exchange Management (Transfer of Issue of Security by a Person Resident
outside India) Regulations, 2000 notified vide Notification No. FEMA 20/2000-RB
dated May 3, 2000, as amended from time to time read with A.P. (DIR Series)
Circular No.63 dated April 22, 2009 as well as paragraph 9 of Schedule I to the
Foreign Exchange Management (Transfer of Issue of Security by a Person Resident
outside India) Regulations, 2000 notified vide Notification No. FEMA 20/2000-RB
dated May 3, 2000, as amended from time to time. Accordingly, transfer of
‘participating interest/ rights’ will be reported as ‘other’ category under
Para 7 of revised Form FC-TRS as given in the Annex and issuance of
‘participating interest/ rights’ will be reported as ‘other’ category of
instruments under Para 4 of Form FC-GPR.
3. Necessary
amendments to the Foreign Exchange Management (Transfer of Issue of Security by
a Person Resident outside India) Regulations, 2000 notified vide Notification No.
FEMA 20/2000-RB dated May 3, 2000 are being notified
separately.
4. AD Category –
I banks may bring the contents of the circular to the notice of their
constituents.
5. The directions
contained in this circular have been issued under Sections 10(4) and 11(1) of
the Foreign Exchange Management Act, 1999 (42 of 1999) and are without
prejudice to permissions / approvals, if any, required under any other law.
Annex
[Annex to A. P. (DIR Series) Circular No. 45 dated
November 16, 2011]
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Form FC-TRS |
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Declaration
regarding transfer of shares / compulsorily and mandatorily convertible
preference shares (CMCPS) / debentures /other by way of sale from resident to
non resident / non-resident to resident |
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(to
be submitted to the designated AD branch in quadruplicate within 60 days from
the date of receipt of funds) |
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The
following documents are enclosed For
sale of shares / compulsorily and mandatorily convertible preference shares /
debentures / other by a person resident in India i.
Consent Letter duly signed by the seller and buyer or their duly appointed
agent and in the latter case the Power of Attorney Document. ii.
The shareholding pattern of the investee company after the acquisition of
shares by a person resident outside India. iii.
Certificate indicating fair value of shares from a Chartered Accountant. iv.
Copy of Broker's note if sale is made on Stock Exchange. v.
Declaration from the buyer to the effect that he is eligible to acquire shares
/ compulsorily and mandatorily convertible preference shares / debentures
under FDI policy and the existing sectoral limits
and Pricing Guidelines have been complied with. vi.
Declaration
from the FII/sub account to the effect that the individual FII / Sub account
ceiling as prescribed has not been breached. Additional
documents in respect of sale of shares / compulsorily and mandatorily
convertible preference shares / debentures / other by a person resident
outside India vii.
If the sellers are NRIs/OCBs, the copies of RBI approvals, if applicable,
evidencing the shares held by them on repatriation/non-repatriation basis. viii.
No Objection/Tax Clearance Certificate from Income Tax Authority/ Chartered
Account. |
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1 |
Name
of the company |
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Address
(including e-mail, telephone Number, Fax no) |
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Activity |
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NIC
Code No. |
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2 |
Whether
FDI is allowed under Automatic route |
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Sectoral
Cap under FDI Policy |
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3
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Nature
of transaction (Strike
out whichever is not applicable) |
Transfer
from resident to non resident / Transfer
from non resident to resident |
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4
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Name
of the buyer |
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Constitution
/ Nature of the investing Entity Specify
whether 1.
Individual 2.
Company 3.
FII 4.
FVCI 5.
Foreign Trust 6.
Private Equity Fund 7.
Pension/ Provident Fund 8.
Sovereign Wealth Fund (SWF*) 9.
Partnership / Proprietorship firm 10.
Financial Institution 11.
NRIs / PIOs 12.
others |
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Date
and Place of Incorporation |
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Address
of the buyer (including e-mail, telephone number. Fax no.) |
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5
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Name
of the seller |
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Constitution
/ Nature of the disinvesting entity Specify
whether 1.
Individual 2.
Company 3.
FII 4.
FVCI 5.
Foreign Trust 6.
Private Equity Fund 7.
Pension/ Provident Fund 8.
Sovereign Wealth Fund (SWF*) 9.
Partnership/ Proprietorship firm 10.
Financial Institution 11.
NRIs/PIOs 12.
others |
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Date
and Place of Incorporation |
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Address
of the seller (including e-mail, telephone Number Fax no) |
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*SWF means a Government investment
vehicle which is funded by foreign exchange assets, and which manages those assets
separately from the official reserves of the monetary authorities. |
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6
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Particulars
of earlier Reserve Bank / FIPB approvals |
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7
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Details
regarding shares / compulsorily and mandatorily convertible preference shares
(CMCPS) / debentures/ others (such as FDI compliant instruments like
participating interest/ rights in oil fields, etc.) to be transferred |
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Date
of the transaction |
Number
of shares CMCPS / debentures /other |
Face
value in Rs. |
Negotiated
Price for the transfer**in Rs. |
Amount
of consideration in Rs. |
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8
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Foreign
Investments in the company |
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No.
of shares |
Percentage
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Before
the transfer |
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After
the transfer |
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9
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Where
the shares / CMCPS / debentures / other are listed on Stock Exchange |
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Name
of the Stock exchange |
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Price
Quoted on the Stock exchange |
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*SWF means a Government investment vehicle
which is funded by foreign exchange assets, and which manages those assets
separately from the official reserves of the monetary authorities. |
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Where
the shares / CMCPS / debentures /other are Unlisted |
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Price
as per Valuation guidelines* |
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Price
as per Chartered Accountants *
/ ** Valuation report (CA Certificate to be attached) |
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Declaration
by the transferor / transferee I
/ We hereby declare that : i.
The particulars given above are true and correct to the best of my/our
knowledge and belief. ii.
I/ We, was/were holding the shares compulsorily and mandatorily convertible
preference shares / debentures/ other as per FDI Policy under FERA/ FEMA
Regulations on repatriation/non repatriation basis. iii.
I/ We, am/are eligible to acquire the shares compulsorily and mandatorily
convertible preference shares / debentures /other of the company in terms of
the FDI Policy. It is not a transfer relating to shares compulsorily and
mandatorily convertible preference shares / debentures /other of a company
engaged in financial services sector or a sector where general permission is
not available. iv.
The Sectoral limit under the FDI Policy and the
pricing guidelines have been adhered to. Signature
of the Declarant or his duly authorised agent Date:
Note:
In
respect of the transfer of shares / compulsorily and mandatorily convertible
preference shares / compulsorily and mandatorily convertible debentures/
other from resident to non resident the declaration
has to be signed by the non resident buyer, and in
respect of the transfer of shares / compulsorily and mandatorily convertible
preference shares / compulsorily and mandatorily convertible debentures/
other from non-resident to resident the declaration has to be signed by the
non-resident seller. Certificate
by the AD Branch It
is certified that the application is complete in all respects. The
receipt /payment for the transaction are in accordance with FEMA Regulations
/ Reserve Bank guidelines. Signature
Name
and Designation of the Officer Date:
Name
of the AD Branch AD Branch Code |
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Know
Your Customer (KYC) Form in respect of the non-resident investor
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Registered
Name of the Remitter / Investor (Name, if the investor is an Individual) |
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Registration
Number (Unique Identification Number* in case remitter is an Individual) |
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Registered
Address (Permanent Address if remitter Individual) |
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Name
of the Remitter’s Bank |
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Remitter’s
Bank Account No. |
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Period
of banking relationship with the Remitter |
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*Passport
No., Social Security No, or any Unique No. certifying the bonafides
of the remitter as prevalent in the remitter’s country.
We
confirm that all the information furnished above is true and accurate as
provided by the overseas remitting bank of the non-resident investor.
(Signature of the
Authorised Official
of
the AD bank receiving the remittance)
Date:
Place:
Stamp:
Proforma
Statement of inflows/outflows on account of remittance
received/made in connection with transfer of shares / compulsorily and
mandatorily convertible preference shares / debentures/others/other, by way of
sale
Category-wise
Part
A - NRI/erstwhile OCB
Part
B - Foreign National/non-resident incorporated entity
Part
C - Foreign Institutional Investors
Inflow
-Transfer from resident to non-resident
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[Amount in Rs.] |
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Date
of Transaction |
Name
of the Company |
Activity
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NIC
Code |
Name
of the Buyer |
Constitution/
Nature of Business of the Buyer |
Name
of the Seller |
Constitution/
Nature of Business of the Seller |
No.
of Shares transferred |
Face
Value |
Sale
price per share |
Total
Inflow |
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(1)
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(2)
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(3)
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(4)
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(5)
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(6)
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(7)
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(8)
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(9)
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(10)
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(11)
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(12)
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Outflow
- Transfer from non-resident to resident
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[Amount in Rs.] |
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Date
of Transaction |
Name
of the Company |
Activity
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NIC
Code |
Name
of the Seller |
Constitution/
Nature of Business of the Seller |
Name
of the Buyer |
Constitution/
Nature of Business of the Buyer |
No.
of Shares transferred |
Face
Value |
Sale
price per share |
Total
Inflow |
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(1)
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(2)
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(3)
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(4)
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(5)
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(6)
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(7)
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(8)
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(9)
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(10)
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(11)
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(12)
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