[Jayesh H practises at the Trifecta of Law, Finance & Governance, and thanks Muskaan Shah for assisting with this post] The recent draft of the Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2024, issued by the Reserve Bank of India, has been projected as an initiative to streamline the export and import processes. Its primary objective is to enhance the...
SEBI’s Proposal for Indian Mutual Funds and Overseas Investments
[Adnan Danish and Zaier Ahmad are penultimate year BA LL.B. (Hons.) students at National Law Institute University, Bhopal ] The Securities and Exchange Board of India (SEBI) has recently issued a consultation paper that aims to address a regulatory gap. Currently, SEBI-registered mutual funds can invest in various overseas securities, including American Depository Receipts (ADRs), Global...
Downstream Investments by FOCCs – Resolving the Regulatory Conundrum
[Roshan Cyriac is a 4th-year B.A., LL.B. (Hons.) student at NALSAR University of Law, Hyderabad] Foreign investors can invest in India directly through foreign direct investment (FDI) or through an entity owned and controlled by it (FOCC). An FOCC is a company incorporated in India but owned and controlled by a (non-resident) foreign company. When a non-resident transfers shares in Indian...
Foreign Direct Listing: Status of an Unlisted Public Company Post-Listing
[Sanyam Jha is a 4th year law student at West Bengal National University of Juridical Sciences, Kolkata] The transformation of India’s legal framework in terms of global fundraising opportunities for local enterprises represents a key step toward attracting foreign investment and boosting growth potential. Historically, Indian enterprises sought access to foreign cash through methods such...
Currency Derivatives Market in Transition: A Deep Dive into RBI’s Regulatory Intervention
[Palash Varyani is a 3rd-year B.A., LL.B. (Hons.) student at the Institute of Law, Nirma University, Ahmedabad] India’s currency derivatives market is undergoing a profound transformation following the Reserve Bank of India’s (RBI) recent directive, set to be enforced on May 3. Brokers are advising clients to square off rupee derivatives positions as the regulatory landscape undergoes a...
Transforming the Financial Landscape: RBI’s Overhaul of Forex Authorization Framework
[Harshal Chhabra and Shaswat Kashyap are 2nd year and 3rd year students respectively at Gujarat National Law University] In response to the dynamic shifts in the financial landscape, the Reserve Bank of India (the RBI) on 26 December 2023 introduced a draft licensing framework for Authorized Persons (APs) under the Foreign Exchange Management Act, 1999 (the Act). This move signifies a pivotal...
Put Options: Putting Up with Foreign Exchange Regulation
[Ryan Joseph is a 3rd year B.B.A., LL.B. (Hons.) student at Jindal Global Law School] A decision of the Madras High Court in January this year in GPE (India) Limited v. Twarit Consultancy has added to the controversial debate over the enforcement of put options that guarantee assured returns. The High Court toed the line with other courts and upheld an arbitral award, notwithstanding the...
Cross-Border Merger Framework in India: Limited Efficacy?
[Rajat Sethi (Partner), Sumit Bansal (Partner) and Oshika Nayak (Associate) are at S&R Associates] The Ministry of Corporate Affairs (“MCA”) notified section 234 of the Companies Act, 2013, as amended (the “Companies Act”), and rule 25A of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, as amended (the “Companies Merger Rules”), on April 13, 2017, to permit merger and...
Relaxation for Flip Structures under the New Overseas Investment Regime
[Shubh Gautam is a fourth year B.A.LL.B (Hons) student at Chanakya National Law University, Patna] Indian startups and new age companies are jumping on the bandwagon of ‘flipping’ their business. This trend has been addressed by the Foreign Exchange Management (Overseas Investment) Rules, 2022 issued on August 22, 2022 (forming a part of the new overseas investment regime). The new overseas...
What the ODI-OPI Holds for Indian Entities
[Hrithik Merchant is a 4th year law student pursuing BA LLB (Hons.) from National Law School of India University, Bangalore] The Reserve Bank of India (“RBI”) reported that between April 2000 and August 2022 there was a financial commitment (“FC”) of overseas investment issued to the tune of USD 614 billion. Overseas investment has been accretive with Indian ventures attempting to access global...
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