[The following guest post is contributed by Arup Pereira, who is a Principal Associate at J. Sagar Associates, Mumbai] The Government’s foreign direct investment (“FDI”) policy on retail trading in India encourages foreign companies and Indian companies with foreign investment to “Make in India”. At present, FDI is not permitted in an Indian company engaging in business to consumer (“B2C”) e...
RBI Permits Deferment of Consideration and Escrow Mechanism Under Automatic Route
[The following post is contributed by Abhishek Dubey who is a Managing Associate with BMR Legal, Delhi. The views expressed here are personal.] In continuation of its policy to rationalize the existing regime under the Foreign Exchange Management Act and to promote the ease of doing business, the Reserve Bank of India (RBI) has amended the Foreign Exchange Management (Transfer or Issue of...
Some Ambiguities in the Rules on Downstream Investments
[The following guest post is contributed by Ajay G. Prasad, who is a Senior Associate with Kochhar & Co, Bangalore. Views expressed in this post are personal and do not reflect the views of the firm.] Exchange control rules on downstream investment form an important aspect to consider in M&A transactions. As per the foreign direct investment policy (“FDI Policy”) of the Department of...
A Move Towards “Pool in India”; However, Room for More Reforms Exists!
[The following post is contributed by Yashesh Ashar, who is a tax and regulatory consultant. Views expressed are personal.] The Finance Bill, 2016 has given in to the much sought-after demand of the domestic private equity (PE) industry by amending the provisions relating to the tax withholding obligations for the category I and category II alternative investment funds (‘AIFs’) registered with...
Press Note 3 of 2016: ‘Old wine in a new bottle’?
Press Note 3 of 2016 issued by the Department of Industrial Policy and Promotion (DIPP) has had a mixed reception – e-commerce companies have largely remained silent, while some ‘brick and mortar’ retailers have welcomed the prohibition on influencing the price of goods amongst others. We believe that pending litigation and consultations with stakeholders have led the Government to issue the...
FDI Reforms in E-Commerce: What Do They Entail?
In a post on this Blog earlier this month, Satyajit Gupta and Saurabh Sharma elaborately discussed the background to the foreign direct investment (FDI) policy in the e-commerce sector. Ambiguities in the policy have not only given rise to uncertainties to players in the sector, but have also resulted in multiple rounds of litigation. As they demonstrate, the dominant e-tailers have gravitated...
Budget 2016 amends FCRA – paves way for CSR by FOCCs
[The following guest post is contributed by Aditi Jhunjhunwala, who is a partner at Vinod Kothari & Co, and can be reached at [email protected]]. Amongst the various amendments proposed in the Finance Bill, 2016, one such relates to changes to the provisions of the Foreign Contribution (Regulation) Act, 2010 (the Act/FCRA), which has come as a relief to foreign owned and controlled...
Indian REITs – Story So Far, Challenges and Expectations from Budget 2016
[This guest post is contributed by Yashesh Ashar and Swati Adukia. They are tax professionals and specialize in mergers and acquisition tax. Please note that the views are personal] I. Introduction The Securities and Exchange Board of India (“SEBI”) notified the SEBI (Real Estate Investment Trusts) Regulations, 2014 (“REIT Regulations”)...
Understanding the Exit Rights Provided by Private Companies
[The following guest post is contributed by Ananya Banerjee, a 5th Year Student of University of Calcutta, Department of Law] Investing in companies (especially in startups) involves a huge risk. For this reason, financial investors look for exit rights which allow them to exit the company with a high return on the investment amount. While the aim of the strategic investors is not to...
FDI in Marketplace Model – New Proposal for E-commerce
[The following guest post is contributed by Ananya Banerjee, a 5th Year Student of University of Calcutta, Department of Law] Press Trust of India has reported on February 9, 2016 that the government is considering permitting 100% FDI in the marketplace model of e-commerce to attract more foreign investments. It was already expected that the Government would soon come up with a proper definition...
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