RBI’s New System for monitoring Foreign Investment limits in Listed Indian Companies

May 07, 2018 | by Avantis RegTech Legal Research Team

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General Compliance

Reserve Bank of India (RBI) in order to enable listed Indian companies to ensure compliance with the various foreign investment limits, Reserve Bank in consultation with Securities and Exchange Board of India (SEBI), has decided to put in place a new system for monitoring foreign investment limits, for which the necessary infrastructure and systems for operationalizing the monitoring mechanism, shall be made available by the depositories.

All listed Indian companies are required to provide the specified data/ information on foreign investment to the depositories. The requisite information may be provided before May 15, 2018. The listed Indian companies, in non-compliance with the above instructions will not be able to receive foreign investment and will be non-compliant with Foreign Exchange Management Act, 1999 (FEMA) and regulations made thereunder.

All Authorised Dealer Banks are advised to instruct their clients and respective Indian companies, about the system requirement.

Further, upon implementation of the new monitoring system, all Authorised Dealer banks would be required to provide the details of investment made by their respective NRI clients to the depositories in the format as provided by the depositories/ SEBI.

[RBI/2017-18/172 A.P. (DIR Series) Circular No. 27 [(1)/20(R)]]

URL: https://rbidocs.rbi.org.in/rdocs/notification/PDFs/APDIR2736319E1A15B14AAE8CC60CC3E77ED283.PDF


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