(1) These regulations may be called the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000.

(2) They shall come into effect on the 1st day of June, 2000.

In these regulations, unless the context requires otherwise,

(i) Act means the Foreign Exchange Management Act, 1999 (42 of 1999);

2[(i-a) Asset Reconstruction Company (ARC) means a company registered with the Reserve Bank of India under Section 3 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act).]

3[(ii) Capital means equity shares, preference shares and convertible debentures;]

4[Explanation. The equity shares issued in accordance with the provisions of the Companies Act, as applicable, shall include equity shares that have been partly paid. Preference shares and convertible debentures shall be required to be fully paid, mandatorily and fully convertible.]

5[(ii-A) Category I Alternative Investment Fund (Cat-I AIF) means an Alternative Investment Fund registered under the Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012 which raises money and invests in such funds or sectors or activities or areas in accordance with the said regulations.]

6[(ii-A) convertible note means an instrument issued by a startup company evidencing receipt of money initially as debt, which is repayable at the option of the holder, or which is convertible into such number of equity shares of such startup company, within a period not exceeding five years from the date of issue of the convertible note, upon occurrence of specified events as per the other terms and conditions agreed to and indicated in the instrument;]

7[ii-a] entity incorporated outside India means an entity incorporated/registered under the relevant statutes, laws of the host country;]

8[ii-b) preference shares mean compulsorily and mandatorily convertible preference shares;]

9[(ii-c) debenture means compulsorily and mandatorily convertible debenture;]

10[(ii-cc) Domestic Custodian means a custodian of securities, an Indian depository, a depository participant, or a bank and having permission from SEBI to provide services as custodian.]

11[(ii-d) Domestic Depository shall have the meaning as assigned to it in the Companies (Issue of Indian Depository Receipts) Rules, 2004;

12[(ii-dd) Depository Receipt means a foreign currency denominated instrument, whether listed on an international exchange or not, issued by a foreign depository in a permissible jurisdiction on the back of eligible securities issued or transferred to that foreign depository and deposited with a domestic custodian and includes global depository receipt as defined in Section 2(44) of the Companies Act, 2013.]

(ii-e) Eligible Company means a company eligible to issue Indian Depository Receipts under Rule 4 of the Companies (Issue of Indian Depository Receipts) Rules, 2004;]

13[(ii-f) employees' stock option means the option given to the directors, officers or employees of a company or of its holding company or joint venture or wholly owned overseas subsidiary/subsidiaries, if any, which gives such directors, officers or employees, the benefit or right to purchase, or to subscribe for, the shares of the company at a future date at a pre-determined price;]

(iii) registered Foreign Institutional Investor (FII) means the foreign institutional investor registered with SEBI; 14[Any foreign institutional investor who holds a valid certificate of registration from SEBI shall be deemed to be a registered foreign portfolio investor (RFPI) till the expiry of the block of three years]

15[(iii-a) Foreign Venture Capital Investor means an investor incorporated and established outside India which proposes to make investment in Venture Capital Fund(s) or Venture Capital Undertaking(s) in India and is registered with SEBI under SEBI (Foreign Venture Capital Investors) Regulations, 2000;]

16[(iii-b) Foreign Central Bank means an institution/organization/body corporate established in a country outside India and entrusted with the responsibility of carrying out central bank functions under the law for the time being in force in that country;]

(iv) Government approval means approval from the Secretariat for Industrial Assistance (SIA), Department of Industrial Policy and Promotion, Government of India or as the case may be, Foreign Investment Promotion Board (FIPB) of the Government of India;

17[(iv-a) Group company means two or more enterprises which, directly or indirectly, are in a position to:

(i) exercise twenty-six per cent, or more of voting rights in other enterprise; or

(ii) appoint more than fifty per cent, of members of board of directors in the other enterprise.]

(v) Indian company means a company incorporated in India;

18[(va) Indian Depository Receipts (IDRs) shall have the meaning as assigned to it in the Companies (Issue of Indian Depository Receipts) Rules, 2004;]

(v-b) 19[* * *]

(vi) Investment on repatriation basis means an investment the sale proceeds of which are, net of taxes, eligible to be repatriated out of India, and the expression Investment on non-repatriation basis , shall be construed accordingly;

(vii) Joint Venture (JV) and Wholly Owned Subsidiary shall have the meanings respectively assigned to them in the Foreign Exchange Management (Transfer and Issue of Foreign Security) Regulations, 2000;

20[(vii-AA) Manufacture , with its grammatical variations, means a change in a non-living physical object or article or thing (a) resulting in transformation of the object or article or thing into a new and distinct object or article or thing having a different name, character and use; or (b) bringing into existence of a new and distinct object or article or thing with a different chemical composition or integral structure.]

21[(vii-a) Non-Resident Indian (NRI) means an individual resident outside India who is citizen of India or is an Overseas Citizen of India cardholder within the meaning of Section 7(A) of the Citizenship Act, 1955.]

22[(viii-b) A Registered Foreign Portfolio Investor (RFPI) means a person registered in accordance with the provisions of Securities Exchange Board of India (SEBI) (Foreign Portfolio Investors) Regulations, 2014, as amended from time to time.

Explanation. For the purpose of this regulation, the expressions, person , resident in India , non-resident shall have the same meaning as assigned to them in Sections 2(u), 2(v) and 2(w) of Foreign Exchange Management Act (FEMA), 1999, respectively.]

(viii) 23[* * *] Overseas Corporate Body (OCB) , shall have the meanings respectively assigned to them in the Foreign Exchange Management (Deposit) Regulations, 2000;

24[(viii-a) Qualified Foreign Investor (QFI) means

(a) during the period from 9th day of August, 2011 to 15th day of July, 2012, a person who satisfied the following criteria at the relevant time,

(i) resident of a country, that is compliant with the Financial Action Task Force (FATF) standards and is a signatory to the IOSCO's Multilateral Memorandum of Understanding (MMoU); and

(ii) satisfied the KYC requirements stipulated by SEBI:

Provided that such a person is not registered with SEBI as a Foreign Institutional Investor (FII) or Foreign Venture Capital Investor (FVCI).

(b) With effect from 16th day of July, 2012, a person who satisfies the following criteria at the relevant time:

(i) Resident in a country that is a member of FATF or a member of a group which is a member of FATF; and

(ii) Resident in a country that is a signatory to IOSCO's MMoU (and referred to as Appendix A Signatories therein) or a signatory of a bilateral MoU with SEBI:

Provided that the person is not resident in a country listed in the public statements issued by FATF from time to time on jurisdictions having strategic AML/CFT deficiencies to which counter measures apply or that have not made sufficient progress in addressing the deficiencies or have not committed to an action plan developed with the FATF to address the deficiencies:

Provided that such person is not resident in India:

Provided further that such person is not registered with SEBI as a FII or Sub-Account of an FII or FVCI.

25[* * *]]

(ix) SEBI means the Securities and Exchange Board of India established under the Securities and Exchange Board of India Act, 1992 (15 of 1992);

(x) Secretariat for Industrial Assistance means Secretariat for Industrial Assistance in the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry, Government of India;

26[(x-A) startup shall mean an entity, incorporated or registered in India not prior to five years, with an annual turnover not exceeding INR 25 crores in any preceding financial year, working towards innovation, development, deployment or commercialization of new products, processes or services driven by technology or intellectual property:

Provided that such entity is not formed by splitting up, or reconstruction of a business already in existence.

For this purpose,

(i) entity shall mean a private limited company (as defined in the Companies Act, 2013), or a registered partnership firm (registered under Section 59 of the Partnership Act, 1932) or a limited liability partnership (under the Limited Liability Partnership Act, 2008).

(ii) the expression turnover shall have the same meaning as assigned to it under the Companies Act, 2013.

(iii) An entity is considered to be working towards innovation, development, deployment or commercialization of new products, processes or services driven by technology or intellectual property if it aims to develop and commercialize (a) a new product or service or process; or (b) a significantly improved existing product or service or process that will create or add value for customers or workflow:

Provided that it will not include the mere act of developing (a) products or services or processes which do not have potential for commercialization; or (b) undifferentiated products or services or processes or (c) products or services or processes with no or limited incremental value for customers or workflow.]

27[(x-a) sweat equity shares means such equity shares as issued by a company to its directors or employees at a discount or for consideration other than cash, for providing their know-how or making available rights in the nature of intellectual property rights or value additions, by whatever name called;]

(xi) Transferable Development Rights (TDR) shall have the same meaning as assigned to it in the regulations made under sub-section (2) of section 6 of the Act;

28[(xi-a) Venture Capital Fund means a fund established in the form of a trust, a company including a body corporate and registered under the Securities and Exchange Board of India (Venture Capital Fund) Regulations, 1996 which has a dedicated pool of capital raised in a manner specified under the said regulations and which invests in Venture Capital Undertakings in accordance with the said regulations;]

[(xi-b) Warrant includes Share Warrant issued by an Indian Company in accordance to provisions of the Companies Act, as applicable. Such warrants shall be treated as security within the meaning of Section 2(za) of FEMA, 1999.]

(xii) The words and expressions used but not defined in these regulations shall have the same meanings respectively assigned to them in the Act.

Save as otherwise provided in the Act, or rules or regulations made thereunder, no person resident outside India shall issue or transfer any security:

Provided that a security issued prior to, and held on, the date of commencement of these regulations, shall be deemed to have been issued under these regulations and shall accordingly be governed by these regulations:

Provided further that the Reserve Bank may, on an application made to it and for sufficient reasons, permit a person resident outside India to issue or transfer any security, subject to such conditions as may be considered necessary.

29[3-A. Restriction on obtaining overseas guarantee. No corporate registered under the Companies Act, 1956 (1 of 1956) shall avail domestic rupee denominated structured obligations by obtaining credit enhancement in the form of guarantee by international banks, international financial institutions or joint venture partners, except with the prior approval of the Reserve Bank:

Provided howsoever that, a company resident in India engaged exclusively in development of infrastructure (infrastructure defined by the Reserve Bank from time to time in this regard) and infrastructure financial companies, as categorized by Reserve Bank from time to time, may obtain, without the prior approval of the Reserve Bank, credit enhancement in the form of guarantee from a person resident outside India for the domestic debts raised by such companies through issue of capital market instrument like bonds and debentures subject to satisfying the terms and conditions as may be stipulated by the Reserve Bank, from time to time, in this regard.]

Save as otherwise provided in the Act or Rules or Regulations made thereunder, an Indian entity shall not issue any security to a person resident outside India or shall not record in its books any transfer of security from or to such person:

Provided that the Reserve Bank may, on an application made to it and for sufficient reasons, permit an entity to issue any security to a person resident outside India or to record in its books transfer of security from or to such person, subject to such conditions as may be considered necessary.

30[A person resident outside India (other than a citizen of Bangladesh or Pakistan) or an entity incorporated outside India (other than an entity in Bangladesh or Pakistan), may purchase shares or convertible debentures or warrants of an Indian company under Foreign Direct Investment Scheme, subject to the terms and conditions specified in Schedule 1.

Explanation. Shares or convertible debentures containing an optionality clause but without any option/right to exit at an assured price shall be reckoned as eligible instruments to be issued to a person resident outside India by an Indian company subject to the terms and conditions as specified in Schedule I.]

31[Further, shares or convertible debentures containing an optionality clause but without any option/right to exit at an assured price shall be reckoned as eligible instruments to be issued to a person resident outside India by an Indian company subject to the terms and conditions as specified in Schedule I.]

32[(ii) Notwithstanding anything contained in sub-regulation (i) above, a person who is a citizen of Bangladesh or an entity incorporated in Bangladesh may, with the prior approval of the Foreign Investment Promotion Board of the Government of India, purchase 33[shares or convertible debentures or warrants] of an Indian company under Foreign Direct Investment Scheme, subject to the terms and conditions specified in Schedule 1.]

34[(iii) Further, notwithstanding anything contained in clause (i) of the sub-regulation (1) above, a person who is a citizen of Pakistan or an entity incorporated in Pakistan may, with the prior approval of the Foreign Investment Promotion Board of the Government of India, purchase 35[shares or convertible debentures or warrants] of an Indian company under Foreign Direct Investment Scheme, subject to the terms and conditions specified in Schedule 1:

Provided further that notwithstanding anything contained in Schedule 1, the Indian company, receiving such foreign direct investment, is not engaged or shall not engage in sectors/activities pertaining to defence, space and atomic energy and sectors/activities prohibited for foreign investment.]

(2) A registered Foreign Institutional Investor (FII) may purchase 36[shares or convertible debentures or warrants] of an Indian company under the Portfolio Investment Scheme, subject to the terms and conditions specified in Schedule 2 37[and the limits and margin requirements prescribed by RBI/SEBI as well as the stipulations regarding collateral securities as specified by the Reserve Bank from time to time. 38[A registered FII including SEBI approved sub-accounts of the FIIs, after registering as RFPI shall not be eligible to invest as FII. However, all investments made by FII in accordance with the regulations prior to registration as RFPI shall continue to be valid and taken into account for computation of aggregate limit]]:

39[(2-A) A registered Foreign Portfolio Investor (RFPI) may purchase shares or convertible debentures of an Indian company under the Foreign Portfolio Investment (FPI) Scheme subject to the terms and conditions specified in Schedule 2-A and the limits and margin requirements prescribed by RBI/SEBI as well as the stipulations regarding collateral securities as specified by the Reserve Bank from time to time.]

40[* * *]

41[* * *]

42[(3) 43[(i) A Non-Resident Indian (NRI) may acquire securities or units on a Stock Exchange in India on repatriation basis under the Portfolio Investment Scheme, subject to the terms and conditions specified in Schedule 3.

(ii) A Non-Resident Indian (NRI) may acquire securities or units on a non-repatriation basis, subject to the terms and conditions specified in Schedule 4.]]

44[(4) A non-resident Indian or a registered FII or a Foreign Central Bank or a QFI 45[or a QFI 46[or a RFPI] or any other person resident outside India included in Schedule 5] may purchase securities, other than shares or convertible debentures of an Indian company, subject to the terms and conditions specified in Schedule 5.]

47[(5) A Foreign Venture Capital Investor registered with SEBI may make investment in the manner and subject to the terms and conditions specified in Schedule 6.]

48[* * *]

49[(6) A registered Foreign Institutional Investor (FII) having valid approval under the Foreign Exchange Regulation Act, 1973 or under the Foreign Exchange Management Act, 1999 may trade in all exchange traded derivative contracts approved by RBI/SEBI subject to the limits and margin requirement prescribed by RBI/SEBI as well as the stipulations regarding collateral securities as directed by the Reserve Bank from time to time.]

50[(6-A) a RFPI may trade in all exchange traded derivative contracts approved by RBI/SEBI subject to the limits and margin requirement prescribed by RBI/SEBI as well as the stipulations regarding collateral securities as directed by the Reserve Bank from time to time]

51[(7) A Non-Resident Indian (NRI) may invest in exchange traded derivative contracts, approved by SEBI from time to time out of INR funds held in India or non-repatriable basis subject to the limits prescribed by SEBI. Such investments will not be eligible for repatriation benefits.]

52[(7-A) A OFI may purchase equity shares of an Indian company subject to the terms and conditions specified in Schedule 8. 53[However, a QFI may continue to buy, sell or otherwise deal in securities for a period of one year from the date of commencement of Securities Exchange Board of India (SEBI) (Foreign Portfolio Investors) Regulations, 2014, or until it obtains a certificate of registration as foreign portfolio investor, whichever is earlier. Further, a QFI after registering as a RFPI, shall not be eligible to invest as QFI. However, all investments made by QFI, in accordance with the regulations prior to registration as RFPI shall continue to be valid and taken into account for computation of aggregate limit]]

54[Explanation. For the purposes of 55[sub-regulations (1) to (7-A)] above, no class of investor referred to in those sub-regulations shall make investment, directly or indirectly, in any security, issued by an Indian company which is engaged or proposes to engage in any of the activities in which foreign investment is prohibited under sub-regulation (b) of Regulation 4 of the Foreign Exchange Management (Permissible Capital Account Transactions) Regulations, 2000, as amended from time to time]

56[(8) A registered Foreign Institutional Investor (FII) including SEBI approved sub-accounts of the FIIs, registered with SEBI 57[a RFPI registered in accordance with the provisions of Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2014] or a Non-Resident Indian (NRI) may purchase, hold or sell Indian Depository Receipts (IDRs) of eligible companies resident outside India and issued in the Indian capital market, subject to the terms and conditions specified in Para 2 of Schedule 7.]

(1) A person resident outside India may purchase equity or preference shares or convertible debentures offered on right basis by an Indian company which satisfies the conditions specified in sub-regulation (2).

(2) An Indian company which satisfies the following conditions, may offer to a person resident outside India, equity or preference shares or convertible debentures on right basis, namely:

(i) The offer on right basis does not result in increase in the percentage of foreign equity already approved, or permissible under the Foreign Direct Investment Scheme in terms of these regulations;

58[(ii) The existing non-resident shareholders may apply for issue of additional shares, and the investee company may allot the same subject to the condition that the overall issue of shares to non-residents in the total paid-up capital does not exceed the sectoral cap;]

59[(iii) The existing shares or debentures against which shares or debentures are issued by the company on right basis were acquired and are held by the person resident outside India in accordance with these regulations;]

60[(iv) The offer on right basis to the persons resident outside India shall be

(a) in the case of shares of a company listed on a recognised stock exchange in India, at a price as determined by the company;

(b) in the case of shares of a company not listed on a recognised stock exchange in India, at a price which is not less than the price at which the offer on right basis is made to resident shareholders.]

(3) The right shares or debentures purchased by the person resident outside India shall be subject to same conditions including restrictions in regard to repatriability as are applicable to the original shares against which right shares or debentures are issued:

Provided that the amount of consideration for purchase of right shares or debentures is paid by way of inward remittance in foreign exchange through normal banking channels or by debit to NRE/FCNR account, when the shares or debentures are issued on repatriation basis:

Provided further that in respect of the shares or debentures issued on non-repatriation basis, the amount of consideration may also be paid by debit to NRO/NRSE/NRNR account.

61[6-A. Acquisition of Bonus shares. An Indian company may issue bonus shares to its non-resident shareholders, subject to the following conditions:

(a) the shares against which bonus shares are issued by the company (hereinafter referred to as the original shares ) were acquired or held by the non-resident shareholder in accordance with the rules/regulations applicable to such acquisition;

(b) the bonus shares acquired by the non-resident shareholder shall be subject to the same conditions including restrictions in regard to repatriability as are applicable to the original shares.

62[6-B. Report to RBI. A company issuing 63[right shares or bonus shares or warrants] in terms of these regulations shall report to the Reserve Bank in Form FC-GPR as stipulated in Paragraph 9(1)(B) of Schedule 1 to these regulations.]

64[6-C. Acquisition of warrants. An Indian company may issue warrants to a person resident outside India subject to terms and conditions stipulated by the Reserve Bank in this behalf from time to time.]

65[6-D. Issue of Convertible Notes by startup companies. (1) A person resident outside India (other than an individual who is citizen of Pakistan or Bangladesh or an entity which is registered/incorporated in Pakistan or Bangladesh), may purchase convertible notes issued by an Indian startup company for an amount of twenty five lakh rupees or more in a single tranche.

Explanation. For the purpose of this Regulation, a startup company means a private company incorporated under the Companies Act, 2013 or Companies Act, 1956 and recognised as such in accordance with Notification Number G.S.R. 180(E), dated February 17, 2016 issued by the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry.

(2) A startup company engaged in a sector where foreign investment requires Government approval may issue convertible notes to a non-resident only with approval of the Government.

Explanation. For the purpose of this regulation, the issue of shares against such convertible notes shall have to be in accordance with the Schedule 1 of the principal regulations.

(3) A startup company issuing convertible notes to a person resident outside India shall receive the amount of consideration by inward remittance through banking channels or by debit to the NRE/FCNR (B)/Escrow account maintained by the person concerned in accordance with the Foreign Exchange Management (Deposit) Regulations, 2016, as amended from time to time:

Provided that an escrow account for the above purpose shall be closed immediately after the requirements are completed or within a period of six months, which ever is earlier. However, in no case continuance of such escrow account shall be permitted beyond a period of six months.

(4) NRIs may acquire convertible notes on non-repatriation basis in accordance with Schedule 4 of the principal regulations.

(5) A person resident outside India may acquire or transfer, by way of sale, convertible notes, from or to, a person resident in or outside India, provided the transfer takes place in accordance with the pricing guidelines as prescribed by RBI. Prior approval from the Government shall be obtained for such transfers in case the startup company is engaged in a sector which requires Government approval.

(6) The startup company issuing convertible notes shall be required to furnish reports as prescribed by Reserve Bank.]

(1) Where a Scheme of merger or amalgamation of two or more Indian companies or a reconstruction by way of de-merger or otherwise of an Indian company, has been approved by a Court in India, the transferee company or, as the case may be, the new company may issue shares to the shareholders of the transferor company resident outside India, subject to the following conditions, namely:

(a) the percentage of shareholding of persons resident outside India in the transferee or new company does not exceed the percentage specified in the approval granted by the Central Government or the Reserve Bank, or specified in these regulations:

Provided that where the percentage is likely to exceed the percentage specified in the approval or the regulations, the transferor company or the transferee or new company may, after obtaining an approval from the Central Government, apply to the Reserve Bank for its approval under these regulations;

(b) the transferor company or the transferee or new company shall not engage in agriculture, plantation or real estate business or trading in TDRs; and (c) the transferee or the new company files a report within 30 days with the Reserve Bank giving full details of the shares held by persons resident outside India in the transferor and the transferee or the new company, before and after the merger/amalgamation/reconstruction, and also furnishes a confirmation that all the terms and conditions stipulated in the scheme approved by the Court have been complied with.

66[(2) Where a Scheme of Arrangement for an Indian company has been approved by a court in India, the Indian company may issue non-convertible redeemable preference shares or debentures out of its general reserves by way of distribution as bonus to the shareholders resident outside India, subject to the following conditions, namely:

(a) the original acquisition of shares/convertible debentures (including non-convertible/optionally convertible/partially convertible preference shares issued as on and up to April 30, 2007 and optionally convertible/partially convertible debentures issued up to June 7, 2007 under Foreign Direct Investment Scheme and treated as eligible (FDI) compliant instruments under the then applicable guidelines) of the Indian company by non-resident shareholders entitling them to hold non-convertible redeemable preference shares or debentures is in accordance with these regulations and the conditions specified in the relevant Schedule;

(b) in accordance with the provisions of the Companies Act, as applicable and the terms and conditions, if any, stipulated in the scheme approved by the court in India have been complied with;

(c) the Indian company or transferee company or a new company has a No objection certificate from Income Tax authority; and

(d) the Indian company shall not engage in any activity/sector mentioned in Annex A to Schedule 1 to these regulations.]

67[(1) An Indian company may issue employees' stock option and/or sweat equity shares to its employees/directors or employees/directors of its holding company or joint venture or wholly owned overseas subsidiary/subsidiaries who are resident outside India, provided that:

(a) scheme has been drawn either in terms of regulations issued under the Securities Exchange Board of India Act, 1992 or the Companies (Share Capital and Debentures) Rules, 2014 notified by the Central Government under the Companies Act, 2013, as the case may be.

(b) The employee's stock option /sweat equity shares issued to non-resident employees/directors under the applicable rules/regulations are in compliance with the sectoral cap applicable to the said company.

(c) Issue of employee's stock option /sweat equity shares in a company where foreign investment is under the approval route shall require prior approval of the Foreign Investment Promotion Board (FIPB) of Government of India.

(d) Issue of employee's stock option /sweat equity shares under the applicable rules/regulations to an employee/director who is a citizen of Bangladesh/Pakistan shall require prior approval of the Foreign Investment Promotion Board (FIPB) of Government of India.

(2) The Reserve Bank may require the company issuing employees' stock option and/or sweat equity shares to submit such reports and at such frequency as it may consider necessary.]

9. Transfer of 68[shares or convertible debentures or warrants] of an Indian company by a person resident outside India. (1) Subject to the provisions of sub-regulation (2), a person resident outside India holding the 69[shares or convertible debentures or warrants] of an Indian company in accordance with these regulations, may transfer the shares or debentures so held by him, in compliance with the conditions specified in the relevant Schedule of these regulations.

70[Further, subject to minimum lock-in period of one year or minimum lock-in period as prescribed under Annex-B of Schedule 1 whichever is higher, a person resident outside India holding the shares or debentures of an Indian company containing an optionality clause in accordance with these regulations and exercising the option/right, may exit without any assured return, subject to the following conditions:

(i) In case of listed company, at the 71[market price prevailing on the floor of the recognised stock exchanges];

72[(ii) case of equity shares, preference shares or debentures of unlisted company, at a price not exceeding that arrived at as per any internationally accepted pricing methodology for valuation of shares on arm's length basis, duly certified by a Chartered Accountant or a SEBI registered Merchant Banker. The guiding principle would be that the non-resident investor is not guaranteed any assured exit price at the time of making such investment/agreements and shall exit at the price prevailing at the time of exit, subject to lock-in period requirement.]]

73[(2) (i) A person resident outside India, not being a non-resident Indian or an overseas corporate body, may transfer by way of sale or gift, the 74[shares or convertible debentures or warrants] held by him or it to any person resident outside India;]

(ii) A non-resident Indian or an overseas corporate body may transfer by way of sale or gift, the 75[shares or convertible debentures or warrants] held by him or it to another non-resident Indian 76[* * *]:

77[* * *]

(iii) A person resident outside India holding the 78[shares or convertible debentures or warrants] of an Indian company in accordance with these regulations

(a) may transfer the same to a person resident in India by way of gift;

(b) may sell the same on a recognized Stock Exchange in India through a registered broker.]

10. 79[Permission] of Reserve Bank in certain cases for transfer of security.

A. Transfer by way of gift or sale by a person resident in India

A person resident in India who proposes to transfer to a person resident outside India 80[not being erstwhile OCBs]

81[(a)(i) any security, by way of gift, shall make an application to the Reserve Bank for its approval.

(ii) The Reserve Bank may grant such approval on being satisfied of the following conditions:

(a) The donee is eligible to hold such a security under Schedules 1, 4 and 5 of these regulations.

(b) The gift does not exceed 5 per cent of the paid up capital of the Indian company/each series of debentures/each mutual fund scheme.

(c) The applicable sectoral cap/foreign direct investment limit in the Indian company is not breached.

(d) The donor and the donee are relatives as defined in section 6 of the Companies Act, 1956.

82[(e) The value of security to be transferred by the donor together with any security transferred to any person residing outside India as gift during the financial year does not exceed the rupee equivalent of US $ 50,000.]

(f) Such other conditions as considered necessary in public interest by the Reserve Bank.

(iii) The application for approval referred to in sub clause (i) shall contain the following information/documents:

(a) Name and address of the donor and the donee.

(b) Relationship between the donor and the donee.

(c) Reasons for making the gift.

(d) In case of Government dated securities and treasury bills and bonds, a certificate issued by a Chartered Accountant on the market value of such securities.

(e) In case of units of domestic mutual funds and units of Money Market Mutual Funds, a certificate from the issuer on the Net Asset Value of such security.

(f) 83[In case of shares or convertible debentures or warrants, a certificate from a Chartered Accountant or Merchant Banker registered with Securities & Exchange Board of India (SEBI) on the value of such securities according to the pricing guidelines stipulated by the Reserve Bank from time to time.]

(g) Certificate from the concerned Indian company certifying that the proposed transfer of 84[shares or convertible debentures or warrants], by way of gift, from resident to the non-resident shall not breach the applicable sectoral cap/FDI limit in the company and that the proposed number of 85[shares or convertible debentures or warrants] to be held by the non-resident transferee shall not exceed 5% of the paid up capital of the company.]

86[(h) A declaration from the donee accepting partly paid shares or warrants that donee is aware of the liability as regards calls in arrear and consequences thereof.]

87[(b) any 88[shares or convertible debentures or warrants] of an Indian company under the Foreign Direct Investment Scheme, whose activities fall under Annex B to Schedule 1, shall, subject to sectoral limits specified therein, transfer such 89[shares or convertible debentures or warrants] without prior approval of the Reserve Bank if the same is by way of sale subject to the following:

(i) that the parties concerned adhere to the pricing guidelines, documentation and reporting requirements for such transfers, stipulated by the Reserve Bank from time to time;

(ii) where the transfer of 90[shares or convertible debentures or warrants] requires the prior approval of the Foreign Investment Promotion Board (FIPB) as per the extant Foreign Direct Investment (FDI) policy:

(a) the requisite approval of the FIPB has been obtained; and

(b) the transfer of 91[shares or convertible debentures or warrants] adheres with the pricing guidelines and documentation, reporting requirements as stipulated by the Reserve Bank from time to time.

(iii) where SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 are attracted, the pricing guidelines and documentation, reporting requirements as stipulated by SEBI are complied with:

Provided howsoever that in case the SEBI guidelines as aforesaid are not complied with, for the purposes of this Regulation, compliance with pricing guidelines, reporting and documentation requirements as stipulated by RBI shall be sufficient.

(iv) where the pricing guidelines under the Foreign Exchange Management Act, (FEMA) 1999 are not complied with

(a) The resultant FDI is in compliance with the requirements of Schedule 1, other than pricing guidelines; and

(b) The pricing for the transaction is compliant with the applicable SEBI Regulations/guidelines; and

(c) Chartered Accountants Certificate to the effect that compliance with the applicable SEBI regulations/guidelines as indicated above is attached to the Form FC-TRS to be filed with the AD bank.

(v) where the investee company is in the financial services sector

(a) 92[* * *]

(b) The requirements of Schedule 1 are complied with.

Explanation. For the purpose of this Regulation, financial services , shall mean service rendered by banking and non-banking companies regulated by the Reserve Bank, insurance companies regulated by Insurance Regulatory and Development Authority (IRDA), pension funds regulated by the Pension Fund Regulatory and Development Authority, other companies regulated by any other financial regulator and such other services as may be directed by Reserve Bank from time to time.]

93[(c) any 94[shares or convertible debentures or warrants] by way of sale, shall make an application to the Reserve Bank for its approval if

(i) the transfer is to take place at a price which is not in conformity with the pricing guidelines stipulated by either the Reserve Bank or the SEBI, or

(ii) it is not covered by clause (b) above.]

95[(d) any 96[shares or convertible debentures or warrants] by way of sale, shall make an application to the Reserve Bank for its approval if the non-resident acquirer proposes deferment of payment of the amount of consideration]

B. Transfer by way of sale not covered by Regulation 9 by a person resident outside India.

1. 97[* * *]

98[2. A person resident outside India, may transfer share or convertible debenture of an Indian company, without the prior permission of the Reserve Bank, by way of sale, to a person resident in India subject to the adherence to pricing guidelines, documentation and reporting requirements for such transfers as may be specified by Reserve Bank from time to time.]

99[(3) Where pricing guidelines under the Foreign Exchange Management Act (FEMA), 1999 are not complied with, a person resident outside India, may transfer 100[* * *] of an Indian Company, by way of sale, to a person resident in India, without the prior permission of the Reserve Bank, subject to the following

(a) The original and resultant investment are in conformity with the requirements of Schedule 1, other than pricing guidelines; and

(b) The pricing for the transaction is compliant with the applicable SEBI regulations/guidelines; and

(c) Chartered Accountants Certificate to the effect that compliance with the applicable SEBI regulations/guidelines as indicated above is attached to the Form FC-TRS to be filed with the AD bank.]

101[C. A person resident outside India may open an Escrow account with an authorized dealer bank in Indian Rupees in India, subject to the terms and conditions as specified in the Foreign Exchange Management (Deposit) Regulations, 2000, as amended from time to time for acquisition of 102[* * *] through open offers/delisting/exit offers, subject to compliance with the relevant SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, as amended from time to time. Such Escrow account may be funded by way of inward remittance through normal banking channel and/or by way of guarantee issued by an authorized dealer bank, subject to terms and conditions as specified in the Foreign Exchange Management (Guarantees) Regulations, as amended from time to time.]

103[D. A non-resident including Non Resident Indian may acquire shares of a listed Indian company on the recognised stock exchange through a registered broker under FDI Scheme provided that;

a. The non-resident investor has already acquired the control in accordance with SEBI (Substantial Acquisition of Shares and Takeover) Regulations and continues to hold such control;

b. The amount of consideration for purchase of shares on the recognised stock exchange for transfer to non-residents may be paid as specified in Para 8 of Schedule 1 to Notification No. FEMA. 20/2000-RB, dated 3rd May, 2000 or out of the dividend payable by Indian investee company in which the non-resident has acquired and continues to hold the control in accordance with SEBI (Substantial Acquisition of Shares and Takeover) Regulations, provided the right to receive dividend is established and the dividend amount has been credited to specially designated non-interest bearing rupee account for acquisition of shares on the recognised stock exchange.]

104[10-A. In case of transfer of shares between a resident buyer and a non-resident seller or vice-versa, not more than twenty five per cent of the total consideration can be paid by the buyer on a deferred basis within a period not exceeding eighteen months from the date of the transfer agreement. For this purpose, if so agreed between the buyer and the seller, an escrow arrangement may be made between the buyer and the seller for an amount not more than twenty five per cent of the total consideration for a period not exceeding eighteen months from the date of the transfer agreement or if the total consideration is paid by the buyer to the seller, the seller may furnish an indemnity for an amount not more than twenty-five per cent of the total consideration for a period not exceeding eighteen months from the date of the payment of the full consideration:

Provided the total consideration finally paid for the shares must be compliant with the applicable pricing guidelines.]

(1) No remittance of sale proceeds of an Indian security held by a person resident outside India shall be made otherwise than in accordance with these regulations and the conditions specified in the relevant Schedule.

(2) An authorised dealer may allow the remittance of sale proceeds of a security (net of applicable taxes) to the seller of shares resident outside India:

Provided

(a) the security was held by the seller on repatriation basis;

(b) either the security has been sold on a recognised stock exchange in India through a stock broker at the ruling market price as determined on the floor of the exchange, or the Reserve Bank's approval has been obtained in other cases for sale of the security and remittance of the sale proceeds therefore; and

(c) a no objection/tax clearance certificate from the Income Tax authority has been produced.

105[ (i) Any person being a promoter of a company registered in India (borrowing company), which has raised external commercial borrowing, may pledge the shares of the borrowing company or that of its associate resident companies for the purpose of securing the external commercial borrowing (ECB) raised by the borrowing company:

Provided that no person shall pledge any such share unless no-objection has been obtained from a bank which is an authorised dealer.

(ii) A bank which is an authorised dealer may grant no objection for pledge of shares under clause (i) after satisfying itself of the following:

(a) the underlying ECB is strictly in compliance with the extant ECB guidelines,

(b) the loan agreement has been signed by both the lender and the borrower,

(c) there exists a security clause in the Loan Agreement requiring the borrower to create charge on financial securities, and

(d) the borrower has obtained Loan Registration Number (LRN) from the Reserve Bank (Amendment) Rules, 2009:

Provided that the no objection may be granted by a bank which is an authorised dealer subject to the following conditions, namely,

(a) the period of such pledge shall be co-terminus with the maturity of the underlying external commercial borrowing;

(b) in case of invocation of pledge, transfer shall be in accordance with the extant FDI Policy and directions issued by the Reserve Bank;

(c) the Statutory Auditor has certified that the borrowing company will utilise/has utilised the proceeds of the external commercial borrowing for the permitted end-use/s only.]

106[(iii) Any person being a non resident investor of a company registered in India (resident investee company) may pledge the shares or convertible debentures of that company to a bank in India to secure the credit facilities being extended to that company for bona fide purposes, subject to the AD bank satisfying itself of the compliance of the conditions stipulated by the Reserve Bank, from time to time, in this regard.

(iv) Any person being a non resident investor of a company registered in India (resident investee company) may pledge the shares or convertible debentures of that company to an overseas bank to secure the credit facilities being extended to the non resident investor or non resident prompter of the resident investee company or its overseas group company subject to the AD bank satisfying itself of the compliance of the conditions stipulated by the Reserve Bank from time to time in this regard.]

107[(v) Any person being a non-resident investor of a company registered in India and listed on a recognised stock exchange/s in India (resident investee company), may pledge the shares of that company, in favour of a Non-Banking Financial Company in India, to secure the credit facilities being extended to that resident investee company for bonafide business purposes, subject to the AD bank satisfying itself of the compliance of the conditions stipulated by the Reserve Bank, from time to time, in this regard.]

108[ (A) An eligible person may issue or transfer eligible securities to a foreign depository for the purpose of issuance of depository receipts in terms of Depository Receipts Scheme, 2014, subject to the terms and conditions specified in Schedule 10.]

(B) An eligible company resident outside India may issue IDRs through a Domestic Depository, to persons resident in India and outside India, subject to the terms and conditions specified in Para 1 of Schedule 7.]

109[14. Guidelines for calculation of total foreign investment in Indian companies, transfer of ownership and control of Indian companies and downstream investment by Indian companies.

Definition. For the purpose of this regulation,

1. 110[(i) for the purpose of this regulation, the expression ownership and control shall mean and include

(a) company shall be considered as owned by resident Indian citizens if more than 50% of the capital in it is beneficially owned by resident Indian citizens and/or Indian companies, which are ultimately owned and controlled by resident Indian citizens. A Limited Liability Partnership will be considered as owned by resident Indian citizens if more than 50% of the investment in such an LLP is contributed by resident Indian citizens and/or entities which are ultimately owned and controlled by resident Indian citizens and such resident Indian citizens and entities have majority of the profit share;

(b) A company owned by non-residents shall mean an Indian company that is not owned by resident Indian citizens.

(i-a) Control' shall include the right to appoint a majority of the directors or to control the management or policy decisions including by virtue of their shareholding or management rights or shareholders agreements or voting agreements.

Explanation. For the purpose of Limited Liability Partnership, control shall mean right to appoint majority of the designated partners, where such designated partners, with specific exclusions to others, have control over all the policies of Limited Liability Partnership.]

(ii) Direct foreign investment shall mean investment received by an Indian Company from non-resident entities regardless of whether the said investments have been made under 111[Schedule 1, 2, 2-A, 3, 6 and 8] of the Notification No. FEMA. 20/2000-RB dated May 3, 2000, as amended from time to time;

(iii) Downstream investment means indirect foreign investment, by one Indian company into another Indian company, by way of subscription or acquisition;

(iv) Holding Company would have the same meaning as defined in Companies Act, 1956;

(v) Indirect foreign investment means entire investment in other Indian companies by an Indian company (IC), having foreign investment in it provided (a) IC is not owned and controlled by resident Indian citizens and/or Indian Companies which are owned and controlled by resident Indian citizens or (b) where the IC is owned or controlled by non-residents.

However, as an exception, the indirect foreign investment in the 100% owned subsidiaries of operating-cum-investing/investing companies will be limited to the foreign investment in the operating-cum-investing/investing company.

(vi) Investing Company means an Indian company holding only investments in other Indian company/ies directly or indirectly, other than for trading of such holdings/securities;

(vii) Non-Resident Entity means person resident outside India (as defined at Section 2(w) of FEMA, 1999);

(viii) Resident Entity means person resident in India (as defined at Section 2(v) of FEMA, 1999), excluding an individual;

(ix) Resident Indian citizen shall be interpreted in line with the definition of person resident in India as per FEMA, 1999, read in conjunction with the Indian Citizenship Act, 1955;

(x) Total foreign investment in an Indian Company would be the sum total of direct and indirect foreign investment.

112[Explanation. (i) Total Foreign Investment shall include all types of foreign investments, direct and indirect, regardless of whether the said investments have been made under Schedule 1, Schedule 2, Schedule 2-A, Schedule 3, Schedule 6, Schedule 8, Schedule 9 and Schedule 10 of Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000.

(ii) Foreign Currency Convertible Bonds (FCCB) and Depository Receipts (DR) having underlying of instruments which can be issued under Schedule 5, being in the nature of debt, shall not be treated as foreign investment. However, any equity holding by a person resident outside India resulting from any conversion of any debt instrument under any arrangement shall be reckoned as foreign investment.]

2. Investment in Indian companies can be made by both non-resident as well as resident Indian entities. Any non-resident investment in an Indian company is direct foreign investment. Investment by resident Indian entities could again comprise both resident and non-resident investments. Thus, such an Indian company would have indirect foreign investment if the Indian investing company has foreign investment in it. The indirect investment can also be through multi-layered structure.

3. Guidelines for calculation of total foreign investment, i.e., direct and indirect foreign investment in an Indian company

(i) Counting of Direction foreign investment All investments made directly by non-resident entities into the Indian company would be counted towards Direct foreign investment .

113[(ii) Counting of indirect foreign investment For the purpose of computation of indirect foreign investment, foreign investment in an Indian company shall include all types of foreign investments regardless of whether the said investments have been made under Schedules 1, 2 (FII holding as on March 31), 2-A (FPI holding as on March 31), 3, 6, 8, 9 and 10 of FEMA (Transfer or Issue of Security by Persons Resident Outside India) Regulations, 2000. FCCBs and DRs having underlying of instruments which can be issued under Schedule 5, being in the nature of debt, shall not be treated as foreign investment. However, any equity holding by a person resident outside India resulting from conversion of any debt instrument under any arrangement shall be reckoned as foreign investment.]

(iii) The methodology for calculation of total foreign investment would apply at every stage of investment in Indian companies and thus in each and every Indian company.

(iv) Additional requirements

(A) The full details about the foreign investment including ownership details etc. in Indian company/ies and information about the control of the company/ies would be furnished by the Company/ies to the Government of India at the time of seeking approval.

(B) In any sector/activity, where Government approval is required for foreign investment and in cases where there are any inter-se agreements between/amongst share-holders which have an effect on the appointment of the Board of Directors or on the exercise of voting rights or of creating voting rights disproportionate to shareholding or any incidental matter thereof, such agreements will have to be informed to the approving authority. The approving authority will consider such inter-se agreements for determining ownership and control when considering the case for approval of foreign investment.

(C) In all sectors attracting sectoral caps, the balance equity i.e. beyond the sectoral foreign investment cap would specifically be beneficially owned by/held with/in the hands of resident Indian citizens and Indian companies, owned and controlled by resident Indian citizens.

114[(D) In the I&B sector where the sectoral cap is up to 49%, the company would need to be owned and controlled by resident Indian citizens and Indian companies, which are owned and controlled by resident Indian citizens.

(a) For this purpose, the equity held by the largest Indian shareholder would have to be at least 51% of the total equity, excluding the equity held by Public Sector Banks and Public Financial Institutions, as defined in Section 4-A of the Companies Act, 1956 or Section 2(72) of the Companies Act, 2013, as the case may be. The term largest Indian shareholder , used in this clause, will include any or a combination of the following:

(i) In the case of an individual shareholder,

(aa) The individual shareholder,

(bb) relative of the shareholder within the meaning of Section 2(77) of Companies Act, 2013,

(cc) A company/group of companies in which the individual shareholder/HUF to which he belongs has management and controlling interest.

(ii) the case of an Indian company,

(aa) The Indian company,

(bb) group of Indian companies under the same management and ownership control.

(b) For the purpose of this Clause, Indian company shall be a company which must have a resident Indian or a relative as defined under Section 2(77) of Companies Act, 2013/HUF, either singly or in combination holding at least 51% of the shares.

(c) Provided that, in case of a combination of all or any of the entities mentioned in sub-clauses (i) and (ii) above, each of the parties shall have entered into a legally binding agreement to act as a single unit in managing the matters of the applicant company.]

(E) If a declaration is made by persons as per Section 187-C of the Indian Companies Act about a beneficial interest being held by a non-resident entity, then even though the investment may be made by a resident Indian citizen, the same shall be counted as foreign investment.

4. The above mentioned policy and methodology would be applicable for determining the total foreign investment in all sectors, except in sectors where it is specified in a statute or a rule there under. The above methodology of determining direct and indirect foreign investment therefore does not apply to the insurance sector which will continue to be governed by the relevant regulation.

115[Guidelines for establishment of Indian companies/transfer of ownership or control of Indian companies, from resident Indian citizens to non-resident entities, in sectors under government approval route

5. Foreign investment in sectors/activities under government approval route will be subject to government approval where:

(i) An Indian company is being established with foreign investment and is not owned by a resident entity or

(ii) Indian company is being established with foreign investment and is not controlled by a resident entity or

(iii) The control of an existing Indian company, currently owned or controlled by resident Indian citizens and Indian companies, which are owned or controlled by resident Indian citizens, will be/is being transferred/passed on to a non-resident entity as a consequence of transfer of shares and/or fresh issue of shares to non-resident entities through amalgamation, merger/demerger, acquisition etc. or

(iv) The ownership of an existing Indian company, currently owned or controlled by resident Indian citizens and Indian companies, which are owned or controlled by resident Indian citizens, will be/is being transferred/passed on to a non-resident entity as a consequence of transfer of shares and/or fresh issue of shares to non-resident entities through amalgamation, merger/demerger acquisition etc.

(v) It is clarified that Foreign investment shall include all types of foreign investments i.e. FDI, investment by FIIs, FPIs, QFIs, NRIs, ADRs, GDRs, Foreign Currency Convertible Bonds (FCCB) and fully, mandatorily & compulsorily convertible preference shares/debentures, regardless of whether the said investments have been made under Schedule 1, 2, 2-A, 3, 6, 8, 9 and 10 of FEMA (Transfer or Issue of Security by Persons Resident Outside India) Regulations.

(vi) Investment by NRIs under Schedule 4 of FEMA (Transfer or Issue of Security by Persons Resident Outside India) Regulations, 2000 will be deemed to be domestic investment at par with the investment made by residents.

(vii) A company, trust and partnership firm incorporated outside India and owned and controlled by nonresident Indians will be eligible for investments under Schedule 4 of FEMA (Transfer or issue of Security by Persons Resident Outside India) Regulations, 2000 and such investment will also be deemed domestic investment at par with the investment made by residents.]

6. Downstream investment by an Indian company which is not owned and/or controlled by resident entity/ies (i) Downstream investment by an Indian company, which is not owned and/or controlled by resident entity/ies, into another Indian company, would be in accordance/compliance with the relevant sectoral conditions on entry route, conditionalities and caps, with regard to the sectors in which the latter Indian company is operating.

Note. With effect from 31st day of July, 2012, Downstream investment/s made by a banking company, as defined in clause (c) of Section 5 of the Banking Regulation Act, 1949, incorporated in India, which is owned and/or controlled by non-residents/a non-resident entity/non-resident entities, under Corporate Debt Restructuring (CDR), or other loan restructuring mechanism, on in trading books, or for acquisition of shares due to defaults in loans, shall not count towards indirect foreign investment. However, their strategic downstream investment shall count towards indirect foreign investment. For this purpose, strategic downstream investments would mean investment by these banking companies in their subsidiaries, joint ventures and associates.

116[(ii) Downstream investments by Indian companies/LLPs will be subject to the following conditions:

a. Such a company/LLP is to notify SIA, DIPP and FIPB of its downstream investment in the form available at http://www.fipbindia.com within 30 days of such investment, even if capital instruments have not been allotted, along with the modality of investment in new/existing ventures (with/without expansion programme);

b. Downstream investment by way of induction of foreign equity in an existing Indian Company to be duly supported by a resolution of the Board of Directors as also a shareholders agreement, if any;

c. Issue/transfer/pricing/valuation of shares shall be in accordance with applicable SEBI/RBI guidelines;

d. For the purpose of downstream investment, the Indian companies/LLPs making the downstream investments would have to bring in requisite funds from abroad and not leverage funds from the domestic market. This would, however, not preclude downstream companies/LLPs, with operations, from raising debt in the domestic market. Downstream investments through internal accruals are permissible (For the purposes of FDI, internal accruals will mean as profits transferred to reserve account after payment of taxes), subject to the provision of clause (i) above and also as elaborated below:

A. Foreign investment into an Indian company, engaged only in the activity of investing in the capital of other Indian company/ies, will require prior Government/FIPB approval, regardless of the amount or extent of foreign investment. Foreign investment into Non-Banking Finance Companies (NBFCs), carrying on activities approved for FDI, will be subject to the conditions specified in Annex B of Schedule I to these regulations.

B. Those companies, which are Core Investment Companies (CICs), will have to additional follow RBI's Regulatory Framework for CICs.

C. For undertaking activities which are under automatic route and without FDI linked performance conditions, Indian company which does not have any operations and also does not have any downstream investments, will be permitted to have infusion of foreign investment under automatic route. However, approval of the Government will be required for such companies for infusion of foreign investment for undertaking activities which are under Government route, regardless of the amount or extent of foreign investment. Further, as and when such a company commences business(s) or makes downstream investment, it will have to comply with the relevant sectoral conditions on entry route, conditionalities and caps.

Note: Foreign investment into other Indian companies would be in accordance/compliance with the relevant sectoral conditions on entry route, conditionalities and caps;

(e) FDI recipient Indian company at the first level which is responsible for ensuring compliance with the FDI conditionalities like no indirect foreign investment in prohibited sector, entry route, sectoral cap/conditionalities, etc. for the downstream investment made by in the subsidiary companies at second level and so on and so forth would obtain a certificate to this effect from its statutory auditor on an annual basis as regards status of compliance with the instructions on downstream investment and compliance with FEMA provisions. The fact that statutory auditor has certified that the company is in compliance with the regulations as regards downstream investment and other FEMA prescriptions will be duly mentioned in the Director's report in the Annual Report of the Indian company. In case statutory auditor has given a qualified report, the same shall be immediately brought to the notice of the Reserve Bank of India, Foreign Exchange Department (FED), Regional Office (RO) of the Reserve Bank in whose jurisdiction the Registered Office of the company is located and shall also obtain acknowledgement from the RO of having intimated it of the qualified auditor report. RO shall file the action taken report to the Chief General Manager-in-Charge, Foreign Exchange Department, Reserve Bank of India, Central Office, Central Office Building, Shahid Bhagat Singh Road, Mumbai 400001.]

117[118[Form DR]

[Refer to Paragraph 4(2) of Schedule I]

RETURN TO BE FILED BY AN INDIAN COMPANY WHO HAS ARRANGED ISSUE OF GDR/ADR

119[Form DR QUARTERLY]

[Refer to Paragraph 4(3) of Schedule I]

Quarterly Return

(To be submitted to the Reserve Bank of India, Foreign Investment Division, Central Office, Mumbai)

120[* * *]

[Refer to Paragraph 4(2) of Schedule 1]

RETURN TO BE FILED BY AN INDIAN COMPANY WHO HAS ARRANGED ISSUE OF GDR/ADR

121[* * *]

122[* * *]

Form TS 1

APPLICATION FOR TRANSFER OF SHARES OF A COMPANY REGISTERED IN INDIA BY A NON-RESIDENT TO A PERSON RESIDENT IN INDIA

1. The application should be completed in duplicate and submitted to the concerned Regional Office of Reserve Bank under whose jurisdiction the Head/Registered Office of the company, whose shares are to be transferred, is situated if the transferor is a foreign company/foreign national resident outside India.

2. The application may be signed either by the transferor or the transferee attaching therewith consent in writing of the other party or a copy of the sale/purchase agreement.

1. Photocopies of Reserve Bank's approval(s) for acquiring and holding shares by the transferor, if specific approval was granted by Reserve Bank for holding/acquisition of shares, if applicable.

2. In case the shares proposed to be transferred are listed on a Stock Exchange, a certificate from a Chartered Accountant certifying the average quotation (average of daily high and low) for one week preceding the date of application.

3. In case of unlisted/thinly traded shares, valuation of the shares on basis of any valuation methodology in vogue, if the total consideration is up to Rs. 20 lakhs.

4. In case of unlisted/thinly traded shares where the total consideration exceeds Rs. 20 lakhs, two valuation certificates for the shares of the company, one from the statutory auditors of the company and the other from an independent Chartered Accountant/SEBI registered Category-I Merchant Banker.

Or

Documentary evidence showing Price Earnings (PE) and Book Value (BV) multiples of Bombay Stock Exchange National Index (BSEN) for the calendar month immediately preceding the date of application and a certificate showing the Earnings Per Share (EPS) and Net Asset Value (NAV) of the shares of the company as per the latest audited Balance Sheet.

[See Regulation (5)(1)]

FOREIGN DIRECT INVESTMENT SCHEME

1. Purchase by a person resident outside India of 123[shares or convertible debentures or warrants] issued by an Indian company. 124[(1) A person resident outside India referred to in clauses (i), (ii) and (iii) of sub-regulation (1) of Regulation 5, may purchase 125[shares or convertible debentures or warrants] issued by an Indian company up to the extent and subject to the terms and conditions set out in this Schedule.]

(2) 126[* * *]

127[Provided that no prior permission of Central Government shall be required for investments to be made by Venture Capital Funds registered with SEBI; investments by multinational financial institutions; or where in the existing joint-venture investment by either of the parties is less than 3%; or where the existing joint venture/collaboration is defunct or sick or for transfer of 128[shares or convertible debentures or warrants] of an Indian company engaged in Information Technology sector or in the mining sector, if the existing joint venture or technology transfer/trade mark agreement of the person to whom the 129[shares or convertible debentures or warrants] are to be transferred are also in the Information Technology sector or in the mining sector for same area/mineral.]

2. Automatic Route of Reserve Bank for Issue of 130[shares or convertible debentures or warrants] by an Indian company. 131[(1) An Indian company, not engaged in any activity/sector mentioned in Annex A to this Schedule, may issue 132[shares or convertible debentures or warrants] to a person resident outside India, subject to the limits prescribed in Annex B to this Schedule, in accordance with the Entry Routes specified therein and the provisions of Foreign Direct Investment Policy, as notified by the Ministry of Commerce & Industry, Government of India, from time to time:

133[134[Provided further] that

a. In the sectors/activities mentioned in the Annex B to the Schedule, foreign investment up to the limit indicated against each sector/activity is allowed subject to the conditions of the extant policy on specified sectors and applicable laws/regulations; security and other conditionalities. In sectors/activities not listed therein, foreign investment is permitted upto 100% on the automatic route, subject to applicable laws/regulations; security and other conditionalities.

b. Wherever there is a requirement of minimum capitalization it shall include share premium received along with the face value of the share, only when it is received by the company upon issue of the shares to the non-resident investor. Amount paid by the transferee during post-issue transfer of shares beyond the issue price of the share, cannot be taken into account while calculating minimum capitalization requirement.

c. Sectoral cap i.e. the maximum amount which can be invested by foreign investors in an entity, unless provided otherwise, is composite and includes all types of foreign investments, direct and indirect, regardless of whether the said investments have been made under Schedule 1, 2, 2(A), 3, 6, 8, 9 and 10 of FEMA (Transfer or Issue of Security by Persons Resident Outside India) Regulations, 2000. FCCBs and DRs having underlying of instruments which can be issued under Schedule 5, being in the nature of debt, shall not be treated as foreign investment. However, any equity holding by a person resident outside India resulting from conversion of any debt instrument under any arrangement shall be reckoned as foreign investment under the composite cap. Sectoral cap is as per table appended below.

d. foreign investment, direct and/or indirect, in an entity will not exceed the sectoral/statutory cap.

e. Foreign investment in sectors under Government approval route resulting in transfer of ownership and/or control of Indian entities from resident Indian citizens to non-resident entities will be subject to Government approval. Foreign investment in sectors under automatic route but with conditionalities, resulting in transfer of ownership and/or control of Indian entities from resident Indian citizens to non-resident entities, will be subject to compliance of such conditionalities.

f. Notwithstanding anything contained in paragraphs (a), (b) and (e) above, portfolio investment up to aggregate foreign investment level of 49% or sectoral/statutory cap, whichever is lower, will not be subject to either Government approval or compliance of sectoral conditions, as the case may be, if such investment does not result in transfer of ownership and/or control of Indian entities from resident Indian citizens to non-resident entities. Other foreign investments will be subject to conditions of Government approval and compliance of sectoral conditions as laid down in the FDI policy.

g. The onus of compliance with the sectoral/statutory caps on foreign investment and attendant conditions, if any, shall be on the company receiving foreign investment.]

135[* * *]

Explanation. A company which proposes to embark on expansion programme to undertake activities or manufacture items included in Annex B to this Schedule may issue 136[shares or convertible debentures or warrants] or debentures out of fresh capital proposed to be issued by it for the purpose of financing expansion programme, up to the extent indicated in Annex B, subject to compliance with the provisions of this paragraph.]

137[* * *]

138[(2) A company which is reckoned as Micro and Small Enterprise (MSE) (earlier Small Scale Industrial Unit) in terms of the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006, including an Export Oriented Unit or a Unit in a Free Trade Zone or in an Export Processing Zone or in a Software Technology Park or in an Electronic Hardware Technology Park, and which is not engaged in any activity/sector mentioned in Annex A to this Schedule may issue 139[shares or convertible debentures or warrants] to a person referred to in paragraph 1, subject to the limits prescribed in Annex B to this Schedule, in accordance with the Entry Routes specified therein and the provision of the Foreign Direct Investment Policy, as notified by the Ministry of Commerce & Industry, Government of India, from time to time.]

140[(3) Any Industrial undertaking, with or without Foreign Direct Investment, which is not an MSE, having an industrial license under the provisions of the Industries (Development & Regulation) Act, 1951 for manufacturing items reserved for manufacture in the MSE sector may issue 141[shares or convertible debentures or warrants] to persons resident outside India referred to in Paragraph 1, to the extent of 24 per cent of its paid-up capital.

Issue of 142[shares or convertible debentures or warrants] in excess of 24 per cent of paid-up capital shall require prior approval of the Foreign Investment Promotion Board of the Government of India and shall be in compliance with the terms and conditions of such approval.]

46[(4)] An Indian company, otherwise eligible to issue 143[shares or convertible debentures or warrants] under this Schedule may issue equity/preference 144[shares or convertible debentures or warrants], subject to pricing guidelines as given in Paragraph 5 of this Schedule, to a person resident outside India,

(i) being a provider of technology/technical know-how, against Royalty/Lumpsum fees due for payment;

(ii) against External Commercial Borrowing (ECB) (other than import dues deemed as ECB or Trade Credit as per RBI Guidelines);

145[(iii) against import of capital goods by units in SEZs, subject to the valuation by a Committee consisting of Development Commissioner and the appropriate Customs officials;]

Provided that the foreign equity in the company after the conversion of royalty/lumpsum fee/ECB into equity is within the sectoral cap notified, if any;]

146[(iv) against any other funds payable by the investee company, remittance of which does not require prior permission of the Government of India or Reserve Bank of India under FEMA, 1999 or any rules/regulations framed or directions issued thereunder, provided that:

i. The equity shares shall be issued in accordance with the extant FDI guidelines on sectoral caps, pricing guidelines etc. as amended by Reserve Bank of India, from time to time;

ii. The issue of equity shares under this provision shall be subject to tax laws as applicable to the funds payable and the conversion to equity should be net of applicable taxes.]

147[(v) way of swap of shares, provided the company in which the investment is made is engaged in an automatic route sector, subject to the condition that irrespective of the amount, valuation of the shares involved in the swap arrangement will have to be made by a Merchant Banker registered with SEBI or an Investment Banker outside India registered with the appropriate regulatory authority in the host country.

Note. A company engaged in a sector where foreign investment requires Government approval may issue shares to a non-resident through swap of shares only with approval of the Government]

148[(5) A wholly owned subsidiary set up in India by a non-resident entity, operating in a sector where 100 per cent foreign investment is allowed in the automatic route and there are no FDI linked conditionalities, may issue equity shares or preference shares or convertible debentures or warrants to the said non-resident entity against pre-incorporation/preoperative expenses incurred by the said non-resident entity up to a limit of five per cent of its capital or USD 500,000 whichever is less, subject to the conditions laid down below.

a. Within thirty days from the date of issue of equity shares or preference shares or convertible debentures or warrants but not later than one year from the date of incorporation or such time as Reserve Bank of India or Government of India permits, the Indian company shall report the transaction in the Form FC-GPR to the Reserve Bank.

b. The valuation of the equity shares or preference shares or convertible debentures or warrants shall be subject to the provisions of Paragraph 5 of Schedule 1 of these regulations.

c. A certificate issued by the statutory auditor of the Indian company that the amount of pre-incorporation/preoperative expenses against which equity shares or preference shares or convertible debentures or warrants have been issued has been utilized for the purpose for which it was received should be submitted with the FC-GPR form.

Explanation. Pre-incorporation/pre-operative expenses shall include amounts remitted to Investee Company's account, to the investor's account in India if it exists, to any consultant, attorney or to any other material/service provider for expenditure relating to incorporation or necessary for commencement of operations.]

149[3. An Indian company intending to issue shares to a person resident outside India in accordance with these regulations directly against foreign inward remittance (or by debit to NRE account/FCNR account) or against consideration other than inward remittance i.e., against royalty/lump sum fee due for payment/import of capital goods by units in SEZs/ECBs (excluding those deemed as ECBs) shall obtain prior approval of the Foreign Investment Promotion Board (FIPB) of Government of India, if the Indian company;

(a) is engaged or proposes to engage, in any activity specified in Annex A to this Schedule; or

(b) proposes to issue shares to a person resident outside India beyond sectoral limits or the activity of the Indian company falls under the FIPB route, as stipulated in Annex B to this Schedule; or

(c) 150[* * *]

(d) proposes to issue shares to a person resident outside India against import of capital goods/machinery/equipment (151[excluding second-hand machinery]) subject to compliance with the conditions specified by the Government of India and the Reserve Bank from time to time; or

(e) proposes to issue shares to a person resident outside India against pre-operative/pre-incorporation expenses (including payments of rent etc.), subject to compliance with the conditions specified by the Government of India and the Reserve Bank from time to time.]

152[* * *]

153[* * *]

154[* * *]

155[5. Issue price. Price of shares issued to persons resident outside India under this Schedule, shall not be less than

(a) the price worked out in accordance with the SEBI guidelines, as applicable, where the shares of the company is listed on any recognised stock exchange in India;

156[(b) the valuation of shares done as per any internationally accepted pricing methodology for valuation of shares on arm's length basis, duly certified by a Chartered Accountant or a SEBI registered Merchant Banker where the shares of the company are not listed on any recognised stock exchange in India; and]

(c) 157[* * *]]

158[* * *]

159[5-B. Notwithstanding anything contained in Paragraph 5 above, where shares in an Indian company are issued to a person resident outside India in compliance with the provisions of the Companies Act, 1956, by way of subscription to Memorandum of Association, such investments may be made at face value subject to eligibility to invest under this Schedule.]

160[* * *]

7. Rate of Dividend on Preference Shares. The rate of dividend on preference shares or convertible preference shares issued under these regulations shall not exceed 300 basis points over the Prime Lending Rate of State Bank of India prevailing as on the date of the Board meeting of the company in which issue of such shares is recommended.

161[8. Mode of payment for shares issued to persons resident outside India. A company in India issuing shares or convertible debentures or warrants under this Schedule to a person resident outside India shall receive the amount of consideration for such shares or convertible debentures or warrants

(i) by inward remittance through normal banking channels, or

(ii) by debit to NRE/FCNR (B) account of the person concerned maintained with an authorised dealer/authorized bank, or

(iii) by debit to a non-interest bearing Escrow account (in Indian Rupees) maintained in India with an AD bank in accordance with Foreign Exchange Management (Deposit) Regulations, 2000.

Explanation. Conversion of Royalty/Lump sum fee due for payment or conversion of ECB, import of capital goods by units in Special Economic Zones, as given elsewhere in the Schedule, shall be treated as consideration for issue of shares within the meaning of this paragraph:

Provided that if the shares or convertible debentures or warrants are not issued within 180 days from the date of receipt of the inward remittance or date of NRE/FCNR (B)/Escrow account, the amount of consideration so received shall be refunded to the person concerned by outward remittance through normal banking channels or by credit to his NRE/FCNR (B) account, as the case may be:

Provided further that the Reserve Bank, may on application made to it and for sufficient reasons permit an Indian company to refund the amount of consideration received towards issue of security, if such amount of consideration is outstanding beyond a period of 180 days from the date of receipt.

Explanation. In case of partly paid equity shares, the period of 180 days shall be reckoned from the date of receipt of each call payment.]

A company in India issuing shares or convertible debentures under this Schedule to a person resident outside India shall receive the amount of consideration for such shares

(i) by inward remittance through normal banking channels, or

(ii) by debit to NRE/FCNR account of the person concerned maintained with an authorised dealer/authorised bank.

162[(iii) by debit to a non-interest bearing Escrow account (in Indian Rupees) maintained in India with an AD bank in accordance with Foreign Exchange Management (Deposit) Regulations, 2000.]

163[Explanation. Conversion of Royalty/Lumpsum fee due for payment or conversion of ECB, as given elsewhere in this Schedule 164[import payables of capital goods by units in Special Economic Zones], shall be treated as consideration for issue of shares within the meaning of this paragraph.]

165[Provided that if the shares or convertible debentures are not issued within 180 days from the date of receipt of the inward remittance or date of 166[debit to NRE/FCNR(B)/Escrow account], the amount of consideration so received shall be refunded to the person concerned by outward remittance through normal banking channels or by credit to his NRE/FCNR(B) account, as the case may be:

Provided further that the Reserve Bank may, on an application made to it and for sufficient reasons permit an Indian company to refund the amount of consideration received towards issue of security, if such amount is outstanding beyond a period of 180 days from the date of receipt.]

9. Report by the Indian company. 167[(1) Reporting of issuance of shares of Indian company: An Indian company issuing shares or convertible debentures in accordance with these regulations shall submit through AD bank to the Regional Office concerned of the Reserve Bank under whose jurisdiction the Registered office of the company operates,

(A) not later than 30 days from the date of receipt of the amount of consideration received by Indian company for issue of 168[shares or convertible debentures or warrants], 169[report in Advance Reporting Form as specified by Reserve Bank from time to time] along with a copy/ies of Foreign Inward Remittance Certificate/s (FIRC), Know Your Customer (KYC) report on the non resident investor and details of the Government approval, if any.

170[Explanation. An Indian company issuing partly paid equity shares, shall furnish a report not later than 30 days from the date of receipt of each call payment.]

(B) not later than 30 days from 171[the date of issue of shares or convertible debentures or warrants], a report in form FC-GPR together with,

(i) a certificate from the Company Secretary of the company accepting investment from persons resident outside India certifying that

(a) all the requirements of the Companies Act, 1956 have been complied with;

(b) terms and conditions of the Government approval, if any, have been complied with;

(c) the company is eligible to issue shares under these Regulations; and

(d) the company has all original certificates issued by authorised dealers in India evidencing receipt of amount of consideration in accordance with paragraph 8 of this Schedule;

(ii) a certificate from SEBI registered Merchant Banker or Chartered Accountant indicating the manner of arriving at the price of the shares issued to the persons resident outside India:

[Provided that, in addition to above, the company shall report the conversion of ECB into equity, in ECB-2 Return of the respective month in case of full conversion of ECB. In case of partial conversion of ECB, the converted portion shall be reported in form FC-GPR to the Regional Office concerned of Reserve Bank and non-converted portion in Form ECB-2].

172[Explanation. An Indian company issuing partly paid shares shall file a report in form FC-GPR to the extent they become paid up.]

173[(2) All Indian companies which have received Foreign Direct Investment in the previous year(s) including the current year shall submit to the Reserve Bank of India, on or before the 15th day of July of each year, 174[a report titled Annual Return on Foreign Liabilities and Assets as specified by the Reserve Bank from time to time].

175[* * *]]

176[10. Reporting of transfer of shares of Indian company. (i) In case of transfer of 177[shares or convertible debentures or warrants] of an Indian company by way of sale from a person resident in India to a person resident outside India or vice versa, the transferor/transferee, resident in India, shall submit to the AD bank a report in the Form FC-TRS specified in Annex F to this Schedule, within 60 days from the date of receipt or payment of the amount of consideration. The onus of submission of the Form FC-TRS within the specified time shall be on the transferor/transferee, resident in India.

178[* * *]

(iii) The IBD/FED/nodal branch of the AD bank shall submit a consolidated monthly statement in respect of all such transactions reported by its branches, to the Reserve Bank in the form and manner stipulated by Reserve Bank, Foreign Exchange Department, Central Office, from time to time.

(iv) The sale consideration in respect of 179[shares or convertible debentures or warrants] remitted into India through normal banking channels, shall be subjected to a KYC check by the remittance receiving AD bank at the time of receipt of funds. In case, the remittance receiving AD bank is different from the AD bank handling the transfer transaction, the KYC check shall be carried out by the remittance receiving bank and the KYC report shall be submitted by the customer to the AD bank for carrying out the transaction along with the form FC-TRS.

(v) In case prior approval of the Reserve Bank is granted for transfer of shares or convertible debentures, from a resident to the non-resident on deferred payment of consideration, the same shall be reported in form FC-TRS, duly certified by the AD bank, within 60 days from the date of receipt of the full and final amount of consideration.]

180[11.] Permission for retaining share subscription money received from persons resident outside India in a foreign currency account. Reserve Bank may, on an application made to it and on being satisfied that it is necessary so to do, permit an Indian company issuing shares to persons resident outside India under this Schedule, to retain the subscription amount in a foreign currency account, subject to such terms and conditions as it may stipulate.

[See Regulation 5(2)]

PURCHASE/SALE OF 181[SHARES OR CONVERTIBLE DEBENTURES OR WARRANTS] OF AN INDIAN COMPANY BY INVESTOR UNDER PORTFOLIO INVESTMENT SCHEME

1. Purchase/sale of 182[shares or convertible debentures or warrants]. 183[(1) A registered Foreign Institutional Investor (FII) may purchase the 184[shares or convertible debentures or warrants] of an Indian company under Portfolio Investment Scheme.

(2) The purchase of 185[shares or convertible debentures or warrants] under sub-paragraph (1) shall be made through registered broker on recognised stock exchange in India.]

(3) The amount of consideration for purchase of 186[shares or convertible debentures or warrants] shall be paid out of award remittance from abroad through normal banking channels or out of funds held in an account maintained with the designated branch of an authorised dealer in India, in accordance with these regulations.

(4) The total holding by each FII/SEBI approved sub-account of FII shall not exceed 10% (ten per cent) of the total paid-up equity capital or 10% (ten per cent) of the paid-up value of each series of convertible debentures issued by an Indian company and the total holdings of all FIIs/sub-accounts of FIIs put together shall not exceed 24 per cent of paid-up equity capital or paid up value of each series of convertible debentures.

187[Provided that the limit of 24% referred to in this paragraph may be increased up to the sectoral cap/statutory ceiling, as applicable, by the Indian company concerned by passing a resolution by its Board of Directors followed by passing of a special resolution to that effect by its General Body.]

Explanation. For arriving at the ceiling on holdings of FIIs, shares/convertible debentures acquired both through primary as well as secondary market will be included. However, the ceiling will not include investment made by FII through off-shore Funds, Global Depository receipts and Euro-Convertible Bonds.

188[(5) A registered FII is permitted to purchase shares/convertible debentures of an Indian company through offer/private placement, subject to the ceiling specified in sub-paragraph (4) of this paragraph and the Indian company is permitted to issue such shares:

Provided that

(i) in case of Public Offer, the price of the shares to be issued is not less than the price at which shares are issued to residents, and

189[(b) in case of issue by private placement, the price is not less than the price arrived in terms of SEBI guidelines or not less than the fair price worked out as per any internationally accepted pricing methodology for valuation of shares on arm's length basis, duly certified by a SEBI registered Merchant Banker or Chartered Accountant, as applicable.]

190[(6) A registered FII may, undertake short selling as well as lending and borrowing of securities subject to such conditions as may be stipulated by the Reserve Bank of India and the SEBI from time to time.]

2. Maintenance of account by a registered FII for routing transactions of purchase and sale of 191[shares or convertible debentures or warrants]. 192[A registered Foreign Institutional Investor may open a Foreign Currency Account and/or a Special Non-Resident Rupee Account with a designated branch of an authorised dealer for routing the receipt and payment for transaction relating to purchase and sale of 193[shares or convertible debentures or warrants] under this Scheme, subject to the following conditions:

(i) The account shall be funded by inward remittance through normal banking channels or by credit of sale proceeds (net of taxes) of the 194[shares or convertible debentures or warrants] sold on stock exchange.

(ii) The funds in the account shall be utilised for purchase of 195[shares or convertible debentures or warrants] in accordance with the provisions of Paragraph 1 of this Scheme or for remittance outside India.

(iii) The funds from Foreign Currency Account of the registered FII may be transferred to Special Non-Resident Rupee account of the same FII and vice versa.]

196[(iv) The Foreign Currency Account and the Special Non-Resident Rupee account of the registered FII shall be a non-interest bearing account/s.]

3. Remittance of sale proceeds of 197[shares or convertible debentures or warrants]. The designated branch of an authorised dealer may allow remittance of net sale proceeds (after payment of taxes) or credit the net amount of sale proceeds of 198[shares or convertible debentures or warrants] to the foreign currency account or a Non-resident Rupee Account of the registered Foreign Institutional Investor concerned.

4. Investment by certain other investors. (1) 199[A domestic asset management company or portfolio manager, who is registered with SEBI as a foreign institutional investor for managing the fund of a sub-account may make investment under the Scheme on behalf of

(i) a person resident outside India who is a citizen of a foreign State, or

(ii) a body corporate registered outside India:

Provided such investment is made out of funds raised or collected or brought from outside through normal banking channel.]

200[* * *]

201[(2)] Investments permitted to be made under sub-paragraph (1) shall not exceed 5% (five per cent) of the total paid-up equity capital or 5% (five per cent) of the paid-up value of each series of convertible debentures issued by an Indian company, and shall also not exceed the over-all ceiling specified in sub-paragraph (4) of Paragraph 1 of this Schedule.

202[SCHEDULE 2-A

[See Regulation 5(2-A)]

PURCHASE/SALE OF 203[SHARES OR CONVERTIBLE DEBENTURES OR WARRANTS] OF AN INDIAN COMPANY BY REGISTERED FOREIGN PORTFOLIO INVESTOR (RFPI) UNDER FOREIGN PORTFOLIO INVESTMENT (FPI) SCHEME

1. Purchase/sale of 204[shares or convertible debentures or warrants]. A Registered Foreign Portfolio Investor (RFPI) registered in accordance with Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2014, as amended from time to time, may purchase 205[shares or convertible debentures or warrants] of an Indian company under FPI Scheme.

2. Maintenance of account by a RFPI for routing transactions of purchase and sale of 206[shares or convertible debentures or warrants]. (i) A RFPI may open a Foreign Currency Account and/or a Special Non-Resident Rupee Account with a designated branch of an Authorized Dealer for routing the receipt and payment for transaction relating to purchase and sale of 207[shares or convertible debentures or warrants] under this Scheme, subject to the following conditions:

a. The Account shall be funded by inward remittance through normal banking channels or by credit of sale proceeds (net of taxes) of the 208[shares or convertible debentures or warrants] sold on stock exchange.

b. The funds in the account shall be utilized for purchase of 209[shares or convertible debentures or warrants] in accordance with the provisions of Paragraph 1 of this Scheme or for remittance outside India.

c. The funds from Foreign Currency Account of the RFPI may be transferred to Special Non-Resident Rupee account of the same RFPI and vice-versa.

d. The Foreign Currency Account and the Special Non-Resident Rupee account of the RFPI shall be non-interest bearing account/s.

(ii) The amount of consideration for purchase of 210[shares or convertible debentures or warrants] shall be paid out of inward remittance from abroad through normal banking channels or out of funds held in an account maintained with the designated branch of an authorised dealer in India, in accordance with these Regulations.

(iii) The total holding by each RFPI shall be below 10% (ten per cent) of the total paid-up equity capital or 10% (ten per cent) of the paid-up value of each series of convertible debentures issued by an Indian company and the total holdings of all RFPI put together shall not exceed 24 per cent of paid-up equity capital or paid up value of each series of convertible debentures. The said limit of 24 per cent will be called aggregate limit:

Provided that the aggregate limit of 24% referred to in this paragraph may be increased up to the sectoral cap/statutory ceiling, as applicable, by the Indian company concerned by passing a resolution by its Board of Directors followed by passing of a special resolution to that effect by its General Body.

Explanation. (1) For arriving at the ceiling on holdings of RFPI, shares/convertible debentures acquired both through primary as well as secondary market will be included. However, the ceiling will not include investment made by RFPI through off-shore Funds, Global Depository Receipts and Euro-Convertible Bonds.

(2) For computation of 24% or enhanced limit as the case may be, holding of RFPI and deemed RFPI in the investee company shall be included.

(iv) A RFPI is permitted to purchase 211[shares or convertible debentures or warrants] of an Indian company through offer/private placement, subject to the ceiling specified in sub-paragraph (iii) of this paragraph and the Indian company is permitted to issue such shares;

Provided that

(a) in case of Public Offer, the price of the shares to be issued is not less than the price at which shares are issued to residents, and

212[(b) in case of issue by private placement, the price is not less than the price arrived in terms of SEBI guidelines or not less than the fair price worked out as per any internationally accepted pricing methodology for valuation of shares on arm's length basis, duly certified by a SEBI registered Merchant Banker or Chartered Accountant, as applicable.]

Explanation. Where a registered foreign institutional investor or a sub account, prior to commencement of Securities Exchange Board of India (SEBI) (Foreign Portfolio Investors) Regulations, 2014, holds equity shares in a company whose shares are not listed on any recognized stock exchange, and continues to hold such shares after initial public offering and listing thereof, such shares shall be subject to lock-in for the same period, if any, as is applicable to shares held by a foreign direct investor placed in similar position, under the policy of the Government of India relating to foreign direct investment for the time being in force.

(v) A RFPI may, undertake short selling as well as lending and borrowing of securities subject to such conditions as may be stipulated by the Reserve Bank of India and the SEBI from time to time.

3. Remittance of sale proceeds of 213[shares or convertible debentures or warrants] The designated branch of an authorised dealer may allow remittance of net sale proceeds (after payment of taxes) or credit the net amount of sale proceeds of 214[shares or convertible debentures or warrants] to the foreign currency account or a Special Non-resident Rupee Account of the registered Foreign Portfolio Investor concerned.

4. The existing class of investors namely, Foreign Institutional Investor (FII) and Qualified Foreign Investor (QFI) registered with SEBI shall be eligible to continue their investment in accordance with SEBI guidelines.]

215[SCHEDULE 3

[See Regulation 5(3)(i)]

1. A Non-resident Indian (NRI) may purchase or sell shares, convertible preference shares, convertible debentures and warrants of an Indian company or units of an investment vehicle, on repatriation basis, on a recognised stock exchange, subject to the following conditions:

a. NRIs may purchase and sell shares/convertible preference shares/convertible debentures/warrants and units under the Portfolio Investment Scheme through a branch designated by an Authorised Dealer for the purpose;

b. The paid-up value of shares of an Indian company purchased by any individual NRI should not exceed five per cent of the paid-up value of shares issued by the company concerned;

c. the paid-up value of convertible preference shares or convertible debentures of any series purchased by any individual NRI on repatriation basis should not exceed five per cent of the paid-up value of convertible preference shares or convertible debentures of that series issued by the company concerned;

d. the paid-up value of warrants of any series purchased by any individual NRI on repatriation basis should not exceed five per cent of the paid-up value of warrants of that series issued by the company concerned;

e. the aggregate paid-up value of shares of any company purchased by all NRIs on repatriation basis should not exceed ten per cent of the paid-up value of shares of the company and the aggregate paid-up value of each series of convertible preference shares or convertible debentures or warrants purchased by all NRIs should not exceed ten per cent of the paid-up value of that series of convertible preference shares or convertible debentures or warrants:

Provided that the aggregate ceiling of ten per cent referred to in this clause may be raised to twenty-four per cent if a special resolution to that effect is passed by the General Body of the Indian company concerned;

f. The NRI investor should take delivery of the shares/convertible preference shares/convertible debentures/warrants and units purchased and give delivery of the same when sold;

g. The investment shall be subject to the provisions of the FDI policy and Schedule 1 of these Regulations in respect of sectoral caps wherever applicable.

Explanation. Investment Vehicles and Units and shall have the same meaning as defined in sub-regulation (ii-g) and (xi-A) of Regulation 2 of these regulations.

2. Report to Reserve Bank. The reporting of transactions under this Schedule shall be made by the designated branch of the Authorised Dealer referred to in Paragraph 1, in a manner specified by Reserve Bank of India.

3. Maintenance of accounts by an NRI for routing transactions for purchase and sale of shares/convertible debentures/units, etc. An NRI may open a designated NRE account (opened and maintained by Authorised Dealer bank in terms of the Foreign Exchange Management (Deposit) Regulations, 2000) for the purpose of investment under this scheme with a designated branch of an Authorized Dealer bank referred to in Paragraph 1, for routing the receipt and payment for transactions relating to sale and purchase of shares/convertible preference shares/convertible debentures/warrants/units under this Schedule. The designated account will be called an NRE (PIS) Account.

The designated branch shall ensure that sale proceeds of securities or units which have been acquired by modes other than Portfolio Investment Scheme such as underlying shares acquired on conversion of ADRs/GDRs, shares/convertible preference shares/convertible debentures/warrants acquired under FDI Scheme or purchased outside India from other NRIs or acquired under private arrangement from residents/non-residents or purchased while resident in India, do not get credited in the NRE (PIS) Account and vice-versa.

4. Permitted Credits/Debits in NRE (PIS) account Credits

a. Inward remittances in foreign exchange though normal banking channels;

b. Transfer from the NRI's other NRE accounts or FCNR (B) accounts maintained with Authorised Dealer in India;

c. Net sale proceeds (after payment of applicable taxes) of shares/convertible preference shares/convertible debentures/warrants/units acquired on repatriation basis under the Scheme and sold on stock exchange through registered broker; and

d. Dividend or income earned on investment made on repatriation basis under the Scheme.

Debits

a. Outward remittances of dividend or income earned;

b. Amounts paid on account of purchase of shares/convertible preference shares/convertible debentures/warrants/units on repatriation basis on stock exchanges through registered broker under the Scheme; and

c. Any charges on account of sale/purchase of securities or units under the Scheme.

d. Remittances outside India or transfer to NRE/FCNR (B) accounts of the account holder of the NRI or any other person eligible to maintain such account.

5. Saving. The existing NRO (PIS) accounts may be re-designated as NRO account.]

216[SCHEDULE 4

[See Regulation 5(3)(ii)]

1. Permission to purchase. A Non-resident Indian (NRI), including a company, a trust and a partnership firm incorporated outside India and owned and controlled by non-resident Indians, may acquire and hold, on non-repatriation basis, equity shares, convertible preference shares, convertible debenture, warrants or units, which will be deemed to be domestic investment at par with the investment made by residents. Without loss of generality, it is stated that

a. An NRI may acquire, on non-repatriation basis, any security issued by a company without any limit either on the stock exchange or outside it.

b. An NRI may invest, on non-repartition basis, in units issued by an investment vehicle without any limit, either on the stock exchange or outside it.

c. An NRI may contribute, on non-repatriation basis, to the capital of a partnership firm, a proprietary firm or a Limited Liability Partnership without any limit.

Explanation: Investment Vehicles and Units and shall have the same meaning as defined in sub-regulation (ii-g) and (xi-A) of Regulation 2 of these regulations.

2. Prohibition on purchase. Notwithstanding what has been stated in Paragraph 1, an NRI shall not make any investment, under this Schedule, in equity shares, convertible preference shares, convertible debenture, warrants or units of a Nidhi company or a company engaged in agricultural/plantation activities or real estate business or construction of farm houses or dealing in Transfer of Development Rights.

Explanation: For the purpose of this paragraph, Real estate business means dealing in land and immovable property with a view to earning profit therefrom and does not include development of townships, construction of residential commercial premises, roads or bridges, educational institutions, recreational facilities, city and regional level infrastructure, townships. Further, earning of rent income on lease of the property, not amounting to transfer, will not amount to real estate business . Investment in units of Real Estate Investment Trusts (REITs) registered and regulated under the SEBI (REITs) Regulations, 2014 shall also be excluded from the definition of real estate business .

3. Method of payment for purchase. The consideration for investment under this Schedule shall be paid by way of inward remittance through normal banking channel from abroad or out of funds held in NRE/FCNR/NRO account maintained with a bank in India:

4. Sale/Maturity proceeds. The sale/maturity proceeds (net of applicable taxes) of the securities or units acquired under this Schedule shall be credited only to NRO account irrespective of the type of account from which the considerations for acquisition were paid.

5. The amount invested under this Scheme and the capital appreciation thereon shall not be allowed to be repatriated abroad. .

[See Regulation 5(4)]

PURCHASE AND SALE OF SECURITIES OTHER THAN SHARES OR CONVERTIBLE DEBENTURES OF AN INDIAN COMPANY BY A PERSON RESIDENT OUTSIDE INDIA

217[1. Permission to Foreign Institutional Investors for purchase of securities. (1) A registered Foreign Institutional Investor (FII) may 218[purchase the following securities on repatriation basis and subject to such terms and conditions as may be specified by the SEBI and the Reserve Bank from time to time]:

(a) dated Government securities/treasury bills;

(b) 219[* * *] non-convertible debentures/bonds issued by an Indian company;

(c) commercial papers issued by an Indian company;

(d) units of domestic mutual funds;

220[(e) Security Receipts (SRs) issued by Asset Reconstruction Companies up to 100 per cent of each tranche, subject to directions/guidelines of Reserve Bank of India]

(e) Security Receipts issued by Asset Reconstruction Companies provided that the total holding by a single FII in each tranche of scheme of Security Receipts shall not exceed 10 per cent of the issue and the 221[the total holding of all eligible investors put together] shall not exceed 49 per cent of the paid up value of each tranche of scheme of Security Receipts issued by the Asset Reconstruction Companies;

(f) Perpetual Debt instruments eligible for inclusion as Tier I capital and Debt capital instruments as upper Tier II capital issued by banks in India to augment their capital (Tier I capital and Tier II capital as defined by Reserve Bank, and modified from time to time) 222[provided that the investment by all eligible investors in Perpetual Debt instruments (Tier I)] shall not exceed an aggregate ceiling of 49 per cent of each issue, and investment by individual FII shall not exceed the limit of 10 per cent of each issue. 223[* * *];

(g) 224[* * *]

(h) with effect from November 3, 2011 non-convertible debentures/bonds issued by Non-Banking Finance Companies categorized as Infrastructure Finance Companies (IFCs) by the Reserve Bank, subject to residual maturity and lock-in period as stipulated by the SEBI and the Reserve Bank from time to time;

(i) with effect from November 22, 2011, Rupee denominated bonds/units issued by Infrastructure Debt Funds 225[* * *], provided that the FIIs may trade such bonds/units amongst the eligible non-resident investors for Infrastructure Debt Funds within the lock-in period;

(j) 226[* * *]

227[(k) credit enhanced bonds:]

Provided that FIIs may offer such securities as permitted by the Reserve Bank from time to time as collateral to the recognized Stock Exchanges in India for their transactions in exchange traded derivative contracts as specified in sub-regulation (6) of Regulation 5.]

228[(l) listed non-convertible/redeemable preference shares or debentures issued in terms of Regulation 7 (2) of these Regulations.]

229[(n) securitised debt instruments, including (i) any certificate or instrument issued by a special purpose vehicle (SPV) set up for securitisation of asset/s with banks, FIs or NBFCs as originators; and/or (ii) any certificate or instrument issued and listed in terms of the SEBI Regulations on Public Offer and Listing of Securitised Debt Instruments, 2008.]

230[1-A. Permission for Qualified Foreign Investors for purchase of securities. (i) A QFI may purchase on repatriation basis, subject to the terms and conditions stipulated by the SEBI and the Reserve Bank in this regard from time to time in the following rupee denominated units of:

(a) equity schemes of SEBI registered domestic mutual funds,

(b) debt scheme of SEBI registered domestic mutual funds which invest in infrastructure,

(c) any scheme of SEBI registered domestic mutual funds that hold at least 25 per cent of their assets (either in debt or equity or both) in infrastructure.

For the purpose of sub-clauses (b) and (c) above, infrastructure shall mean infrastructure as defined in terms of the ECB guidelines.

(ii) A QFI may purchase securities referred to in sub-clauses (a) to (c) above under the following routes, subject to the terms and conditions stipulated by SEBI and Reserve Bank in this regard, from time to time;

(a) Direct Route SEBI registered Qualified Depository Participant (QDP) route;

(b) Indirect Route Unit Confirmation Receipt (UCR) route.]

231[(iii) A QFI may:

(a) purchase, on repatriation basis through SEBI registered Qualified Depository Participants (QDPs) (defined as per the extant SEBI regulations), listed non-convertible debentures, listed bonds of Indian companies and listed units of Mutual Fund Debt Schemes directly from the issuer or through a registered stock broker on a recognised stock exchange in India and sell through a registered stock broker on a recognised stock exchange in India or by way of buyback or redemption by the issuer;

(b) invest in primary issues of non-convertible debentures/bonds provided such non-convertible debentures/bonds are committed to be listed within 15 days of such investment. In the event of such no. convertible debentures/bonds issued to the QFI not being listed within 15 days of issuance to the QFI for any reason, then the QFI shall immediately dispose of these non-convertible debentures/bonds either by way of sale to a third party or to the issuer and the terms of offer to QFI should contain a clause that the issuer of such debt securities shall immediately redeem/buyback the said securities from the QFIs in such an eventuality.]

232[(iv) A QFI which purchases securities under this regulation shall open a single demat account with a Qualified Depository Participant in India.]

233[(v) QFI may purchase, 234[the following securities on repatriation basis through SEBI registered Qualified Depository Participant (QDP) and subject to such terms and conditions as may be specified by the SEBI and the Reserve Bank from time to time];

(a) dated Government securities/treasury bills;

(b) commercial papers issued by an Indian company;

(c) Security Receipts issued by Asset Reconstruction Companies provided that the total holding by an individual QFI in each tranche of scheme of Security Receipts shall not exceed 10 per cent of the issue and the total holdings of all eligible investors put together shall not exceed 49 per cent of the paid up value of each tranche of scheme of Security Receipts issued by the Asset Reconstruction Companies;

(d) Perpetual Debt instruments eligible for inclusion as Tier I capital and Debt capital instruments as upper Tier II capital issued by banks in India to augment their capital (Tier I capital and Tier II capital as defined by Reserve Bank, and modified from time to time) provided that the investment by eligible investors in Perpetual Debt instruments (Tier I) shall not exceed an aggregate ceiling of 49 per cent of each issue, and investment by individual QFI shall not exceed the limit of 10 per cent of each issue;

(e) listed and unlisted non-convertible debentures/bonds issued by an Indian company in the infrastructure sector, where infrastructure is defined in terms of the extant ECB guidelines;

(f) non-convertible debentures/bonds issued by Non-Banking Finance Companies categorized as Infrastructure Finance Companies (IFCs) by the Reserve Bank;

(g) Rupee denominated bonds/units issued by Infrastructure Debt Funds;]

235[(h) credit enhanced bonds;]

236[(i) listed non-convertible/redeemable preference shares or debentures issued in terms of Regulation 7(2) of these regulations.]

(2) A Non-resident Indian 237[* * *] may, without limit, purchase on non-repatriation basis, dated Government securities (other than bearer securities), treasury bills, units of domestic mutual funds, units of Money Market Mutual Funds in India, or National Plan/Savings Certificates.

238[(3) A Multilateral Development Bank which is specifically permitted by Government of India to float rupee bonds in India may purchase Government dated securities.]

239[1-B. Permission to Other Non Resident investors for purchase of securities. 240[(i) Long term investors like Sovereign Wealth Funds (SWFs), Multilateral Agencies, Endowment Funds, Insurance Funds, Pension Funds which are registered with SEBI as eligible investors in Infrastructure Debt Funds may purchase on repatriation basis Rupee Denominated bonds/units issued by Infrastructure Debt Funds.]

241[(ii) Long term investors like Sovereign Wealth Funds (SWFs), Multilateral Agencies, Endowment Funds, insurance Funds, Pension Funds and Foreign Central Banks registered with SEBI may purchase, on repatriation basis, 242[dated Government Securities, subject to the terms and conditions and the limits as stipulated by the Reserve Bank and SEBI from time to time.]]

243[(iii) Long term investors like Sovereign Wealth Funds (SWFs), Multilateral Agencies, Endowment Funds, Insurance Funds and Pension Funds and Foreign Central Banks registered with SEBI may purchase, 244[the following securities on repatriation basis and subject to such terms and conditions as may be specified by the SEBI and the Reserve Bank from time to time]:

(a) dated Government securities/treasury bills;

(b) commercial papers issued by an Indian company;

(c) units of domestic mutual funds;

(d) listed non-convertible debentures/bonds issued by an Indian company;

(e) listed and unlisted non-convertible debentures/bonds issued by an Indian company in the infrastructure sector, where infrastructure is defined in terms of the extant ECB guidelines;

(f) non-convertible debentures/bonds issued by Non-Banking Finance Companies categorized as Infrastructure Finance Companies (IFCs) by the Reserve Bank;

245[(g) Security Receipts (SRs) issued by Asset Reconstruction Companies up to 100 per cent of each tranche, subject to directions/guidelines of Reserve Bank of India]

(h) Perpetual Debt instruments eligible for inclusion as Tier I capital and Debt capital instruments as upper Tier II capital issued by banks in India to augment their capital (Tier I capital and Tier II capital as defined by Reserve Bank, and modified from time to time) provided that the investment by all eligible investors in Perpetual Debt instruments (Tier I) shall not exceed an aggregate ceiling of 49 per cent of each issue, and investment by individual long term investor shall not exceed the limit of 10 per cent of each issue;

(i) primary issues of non-convertible debentures/bonds provided such non-convertible debentures/bonds are committed to be listed within 15 days of such investment. In the event of such non-convertible debentures/bonds issued not being listed within 15 days of issuance, for any reason, then the long term investor shall immediately dispose of those non-convertible debentures/bonds either by way of sale to a third party or to the issuer and the terms of offer to long term investors should contain a clause that the issuer of such debt securities shall immediately redeem/buyback those securities from the long term investors in such an eventuality.]

246[(j) credit enhanced bonds;]

247[(k) listed non-convertible/redeemable preference shares or debentures issued in terms of Regulation 7(2) of these Regulations.]

248[1-C. Permission to registered Foreign Portfolio Investors (RFPI) for purchase of securities. (1) A registered Foreign Portfolio Investor (RFPI) may purchase, on repatriation basis, either directly from the issuer of such securities or through a registered stock broker on a recognized Stock Exchange in India the following securities, subject to the terms and conditions as specified by the SEBI and the Reserve Bank from time to time:

(a) dated Government securities/treasury bills;

(b) 249[* * *] non-convertible debentures/bonds issued by an Indian company;

(c) commercial papers issued by an Indian company;

(d) units of domestic mutual funds;

250[(e) Security Receipts (SRs) issued by Asset Reconstruction Companies up to 100 per cent of each tranche, subject to directions/guidelines of Reserve Bank of India]

(f) Perpetual Debt instruments eligible for inclusion as Tier I capital and Debt capital instruments as upper Tier II capital issued by banks in India to augment their capital (Tier I capital and Tier II capital as defined by Reserve Bank and modified from time to time) provided that the investment by all eligible investors in Perpetual Debt instruments (Tier I) shall not exceed an aggregate ceiling of 49 per cent of each issue and investment by individual RFPI shall not exceed the limit of 10 per cent of each issue;

(g) 251[* * *]

(h) non-convertible debentures/bonds issued by Non-Banking Financial Companies categorized as Infrastructure Finance Companies (IFCs) by the Reserve Bank;

(i) Rupee denominated bonds/units issued by Infrastructure Debt Funds;

(j) 252[* * *]

(k) credit enhanced bonds:

Provided that RFPIs may offer such securities as permitted by the Reserve Bank from time to time as collateral to the recognized Stock Exchanges in India for their transactions in exchange traded derivative contracts as specified in sub-regulation (6-A) of Regulation 5.]

253[(l) listed non-convertible/redeemable preference shares or debentures issued in terms of Regulation 7(2) of these regulations.]

254[(n) securitised debt instruments, including (i) any certificate or instrument issued by a special purpose vehicle (SPV) set up for securitisation of asset/s with banks, FIs or NBFCs as originators; and/or (ii) any certificate or instrument issued and listed in terms of the SEBI Regulations on Public Offer and Listing of Securitised Debt Instruments, 2008.]

2. Permission to Non-resident Indian 255[* * *] for purchase of securities. 256[(1-A) A Non-resident Indian may, without limit, purchase on repatriation basis,

(i) Government dated securities (other than bearer securities) or treasury bills or units of domestic mutual funds;

(ii) bonds issued by a public sector undertaking (PSU) in India;

(iii) shares in Public Sector Enterprises being disinvested by the Government of India, provided the purchase is in accordance with the terms and conditions stipulated in the notice inviting bids.

257[(iv) bonds/units issued by Infrastructure Debt Funds.]

258[(v) listed non-convertible/redeemable preference shares or debentures issued in terms of Regulation 7(2) of these regulations.]

(1-B) A Non-resident Indian may purchase on repatriation basis perpetual debt instruments eligible for inclusion as Tier I capital and Debt capital instruments as upper Tier II capital issued by banks in India to augment their capital, as stipulated by Reserve Bank from time to time. The investments by all NRIs in Perpetual Debt instruments (Tier I) should not exceed an aggregate ceiling of 24 per cent of each issue and investments by a single NRI should not exceed 5 per cent of each issue. Investment by NRIs in Debt capital instruments (Tier II) shall be in accordance with the extant policy for investment by NRIs in other debt instruments.]

259[(2) A Non-resident Indian may, without limit, purchase on non-repatriation basis, listed nonconvertible/redeemable preference shares or debentures issued in terms of Regulation 7(2) of these regulations.]

260[(3) A Non-Resident Indian may subscribe to National Pension System governed and administered by Pension Fund Regulatory and Development Authority (PFRDA), provided such subscriptions are made through normal banking channels and the person is eligible to invest as per the provisions of the PFRDA Act. The annuity/accumulated saving will be repatriable.]

261[262[(4)] A Multilateral Development Bank which is specifically permitted by Government of India to float rupee bonds in India may purchase Government dated securities.]

263[2-A. Permission to Foreign Central Banks for purchase of Government Securities. A Foreign Central Bank may purchase and sell dated Government securities/treasury bills in the secondary market subject to the conditions as may be stipulated by the Reserve Bank from time to time.]

3. Method of payment of purchase consideration. (1) A registered Foreign Institutional Investor who purchases securities under the provisions of this Schedule shall make the payment for purchase of such securities either by inward remittance through normal banking channels or out of funds held in Foreign Currency Account or Non-resident Rupee Account maintained by the Foreign Institutional Investor with a designated branch of an authorised dealer with the approval of Reserve Bank in terms of Paragraph 2 of Schedule 2.

264[(1-A) A RFPI who purchases securities under the provisions of this Schedule shall make the payment for purchase of such securities either by inward remittance through normal banking channels or out of funds held in Foreign Currency Account or Special Non-resident Rupee Account maintained by the RFPI with a designated branch of an authorised dealer in terms of Paragraph 2 of Schedule 2-A.]

(2) A Non-resident Indian 92[* * *] who purchases securities on repatriation basis, under sub-paragraph (1) of Paragraph 2 of this Schedule, shall make payment either by inward remittance through normal banking channels or out of funds held in his/its NRE/FCNR account.

265[(2-A) A non-resident Indian who subscribes to the National Pension System, under sub-paragraph (3) of paragraph (2) of this Schedule shall make payment either by inward remittance through normal banking channels or out of funds held in his NRE/FCNR/NRO account.]

(3) A Non-resident Indian 92[* * *] who purchases securities on non-repatriation basis, under sub-paragraph (2) of this Schedule, shall make payment either by inward remittance through normal banking channels or out of funds held in his/its NRE/FCNR/NRO/NRSR/NRNR account.

266[(4) A Multilateral Development Bank which purchases Government dated securities under this Schedule, shall make payment either by inward remittance through normal banking channels or out of funds held in the account opened with the specific approval of RBI.]

267[(5) A QFI who purchases securities under this Schedule (other than by way of Indirect Route) shall make payment out of funds held in a single non-interest bearing Rupee Account maintained with an AD bank in terms of the Foreign Exchange Management (Deposit) Regulations, 2000, as amended from time to time]

4. Permission for Sale of Securities. A person resident outside India who has purchased securities in accordance with this Schedule 268[may sell/redeem the securities subject to such terms and conditions as may be specified by the SEBI and the Reserve Bank from time to time].

5. Remittance/credit of sale/maturity proceeds. (i) In the case of a registered Foreign Institutional Investor who has sold securities in accordance with Paragraph 4, the designated branch of an authorised dealer referred to in sub-paragraph (1) of Paragraph 3 may allow remittance of net sale/maturity proceeds (after payment of taxes) or credit the net amount of sale/maturity proceeds of such securities to the foreign currency account or Non-resident Rupee Account of the FII investor maintained in accordance with the provisions of Paragraph 2 of Schedule 2.

269[(i-a) In the case of a RFPI who has sold securities in accordance with Paragraph 4, the designated branch of an authorised dealer referred to in sub-paragraph (1-A) of Paragraph 3 may allow remittance of net sale/maturity proceeds (after payment of taxes) or credit the net amount of sale/maturity proceeds of such securities to the Foreign Currency Account or Special Non-resident Rupee Account of the RFPI maintained in accordance with the provisions of Paragraph 2 of Schedule 2-A.]

(ii) In the case of a Non-resident Indian 270[* * *] who has sold securities in accordance with Paragraph 4, the net sale/maturity proceeds (after payment of taxes) of such securities, may be

(a) credited only to NRSR account of the NRI investor where the payment for purchase of securities sold was made out of funds held in NRSR account, or

(b) credited, at the NRI 96[* * *] investor's option, to his/its NRO or NRSR account, where the payment for the purchase of the securities sold was made out of funds held in NRO account, or

(c) remitted abroad or at the NRI 96[* * *] investor's option, credited to his/its NRE/FCNR/NRO/NRSR/NRNR account, where the securities were purchased on repatriation basis in accordance with sub-paragraph (1) of Paragraph 2 and the payment for purchase of the securities sold was made by inward remittance through normal banking channels or out of funds held in NRE/FCNR account.

271[(iii) in the case of sale of Government dated securities by a Multilateral Development Bank, the net maturity proceeds (after payment of taxes) may be remitted abroad or credited to fund account opened with the prior permission of the Reserve Bank.]

272[SCHEDULE 6

[See Regulation 5(5)]

INVESTMENT BY A REGISTERED FOREIGN VENTURE CAPITAL INVESTOR

1. Investment by Foreign Venture Capital Investor. (1) A Foreign Venture Capital Investor (FVCI) registered under the SEBI (FVCI) Regulations, 2000, may purchase

(a) equity or equity linked instruments or debt instruments, issued by an Indian company engaged in any sector mentioned at Annex to this Schedule and whose shares are not listed on a recognised stock exchange at the time of issue of the said securities/instruments;

(b) equity or equity linked instruments or debt instruments issued by a startup, irrespective of the sector in which it is engaged;

(c) units of a Venture Capital Fund (VCF) or of a Category I Alternative Investment Fund (Cat-I AIF) or units of a scheme or of a fund set up by a VCF or by a Cat-I AIF;

subject to the terms and conditions as may be laid down by the Reserve Bank.

Note. An FVCI registered under the SEBI (FVCI) Regulations, 2000 shall not require any prior approval of RBI for investments made under this Schedule.

(2) A registered FVCI may purchase the securities/instruments mentioned above either from the issuer of these securities/instruments or from any person holding these securities/instruments or on a recognized stock exchange.

(3) The consideration for all investment by an FVCI shall be paid out of inward remittance from abroad through normal banking channels or out of sale/maturity proceeds or income generated from investment already made as stated earlier.

2. Maintenance of account by the registered FVCI. A registered FVCI may open a foreign currency account and/or a rupee account with a designated branch of an Authorised Dealer subject to the condition that the account will be used only and exclusively for transactions under this Schedule.

3. Transfer of investments. The FVCI may acquire, by purchase or otherwise, from, or transfer, by sale or otherwise, to, any person resident or non-resident, any security/instrument it is allowed to invest in, at a price that is mutually acceptable to the buyer and the seller/issuer. The FVCI may also receive the proceeds of the liquidation of VCFs or of Cat-I AIFs or of schemes/funds set up by the VCFs or Cat-I AIFs.

4. Reporting. The actual inflow/outflow and the investments made by FVCIs may be reported in a manner as prescribed by Reserve Bank or SEBI.

ANNEX

List of sectors in which a Foreign Venture Capital Investor is allowed to invest

1. Biotechnology

2. IT related to hardware and software development

3. Nanotechnology

4. Seed research and development

5. Research and development of new chemical entities in pharmaceutical sector

6. Dairy industry

7. Poultry industry

8. of bio-fuels

9. Hotel-cum-convention centres with seating capacity of more than three thousand.

10. Infrastructure sector. (This will include activities included within the scope of the definition of infrastructure under the External Commercial Borrowing guidelines/policies notified under the extant FEMA Regulations as amended from time to time).]

273[SCHEDULE 7

[See Regulations 5(8) and 13]

INDIAN DEPOSITORY RECEIPTS BY ELIGIBLE COMPANIES RESIDENT OUTSIDE INDIA

1. Issue of IDRs. Eligible companies resident outside India may issue Indian Depository Receipts (IDRs) through a Domestic Depository, to persons resident in India and outside India, subject to the following conditions

(a) the issue of IDRs is in compliance with the Companies (Issue of Indian Depository Receipts) Rules, 2004, as amended from time to time.

(b) the issue is in compliance with the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended from time to time.

(c) any issue of IDRs by financial/Banking companies having presence in India, either through a branch or subsidiary, shall require prior approval of the sectoral regulator(s).

(d) IDRs shall be denominated in Indian Rupees only.

(e) The proceeds of the issue of IDRs shall be immediately repatriated outside India by the eligible companies issuing such IDRs.

2. Purchase/sale of IDRs. A SEBI registered FII including SEBI approved sub-accounts of the FIIs 274[or a Registered Foreign Portfolio Investor registered in accordance with the provisions of Securities and Exchange Board of India(SEBI) (Foreign Portfolio Investors) Regulations, 2014] or an NRI may purchase, hold or sell IDRs, subject to the following terms and conditions

(a) NRIs may invest in the IDRs out of funds held in their NRE/FCNR(B) account, maintained with an Authorised Dealer/Authorised Bank.

(b) IDRs shall not be automatically fungible into underlying equity shares of the issuing company.

(c) IDRs shall not be redeemable into underlying equity shares before the expiry of one year from the date of issue.

(d) Redemption/conversion of IDRs into underlying equity shares of the issuing company shall be in compliance with sub-regulation (7) of Regulation 22, of the Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations, 2004.]

275[SCHEDULE 8

[See Regulation 5 (7A)]

Scheme for Investment by Qualified Foreign Investors in equity shares

1. Eligible Investors. The Schedule shall be applicable to Qualified Foreign Investors (QFIs) as defined in these regulations.

2. Eligible instruments and eligible transactions

(a) Purchase: QFIs shall be permitted to invest through SEBI registered Qualified Depository Participants (QDPs)

(i) in equity shares of listed Indian companies through SEBI registered stock brokers on recognized stock exchanges in India.

(ii) in equity shares of Indian companies which are offered to public in India in terms of the relevant and applicable SEBI guidelines/regulations.

(iii) equity shares by way of rights shares, bonus shares or equity shares on account of stock split/consolidation or equity shares on account of amalgamation, demerger or such corporate actions.

(b) Sale: QFIs shall be allowed to sell the equity shares so acquired by way of sale

(i) Through recognized brokers on recognized stock exchanges in India; or

(ii) In an open offer in accordance with the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011; or

(iii) In an open offer in accordance with the SEBI (Delisting of Securities) Guidelines, 2009; or

(iv) Through buyback of shares by a listed Indian company in accordance with the SEBI (Buyback) Regulations, 1998.

3. Pricing. The pricing of all eligible transactions and investment in all eligible instruments by QFIs under this scheme shall be in accordance with the relevant and applicable SEBI guidelines only.

4. Mode of payment/repatriation. For QFI investments under this scheme open a single non-interest bearing Rupee Account with an AD Category-I bank in India, for the limited purpose of routing the receipt and payment for transactions relating to purchase and sale of equity shares of listed Indian companies subject to the following conditions:

(a) The account shall be funded by inward remittance through normal banking channel and by credit of the sale/redemption/buyback proceeds (net of taxes) and on account of interest payment/dividend on the eligible securities for QFIs.

(b) The funds in this account shall be utilized for purchase of eligible securities for QFIs or for remittance (net of taxes) outside India.

(c) The QDP will operate such non-interest bearing Rupee Accounts on behalf of the QFIs and at the instructions of the QFIs.

5. Demat accounts. QFIs would be allowed to open a dedicated demat account with a QDP in India for investment in equity shares under the scheme. It is clarified that each QFI shall maintain a single demat account with a QDP for all investments in eligible securities for QFIs in India.

6. Limits and its monitoring. The individual and aggregate investment limits for the QFIs shall be 5 per cent and 10 per cent respectively of the paid up capital of an Indian company. These limits shall be over and above the FII and NRI investment ceilings prescribed under the Portfolio Investment Scheme for foreign investment in India. Further, wherever there are composite sectoral caps under the extant FDI policy, these limits for QFI investment in equity shares shall also be within such overall FDI sectoral caps.

The onus of monitoring and compliance of these limits shall remain jointly and severally with the respective QFIs, DPs and the respective Indian companies (receiving such investment)

7. Other conditions:

(i) Eligibility: QFI would have to meet eligibility criteria as prescribed by SEBI from time to time.

(ii) Know Your Customer (KYC): QDPs will ensure KYC of the QFIs as per the norms prescribed by SEBI. AD Category-I banks will also ensure KYC of the QFIs for opening and maintenance of the single non-interest bearing Rupee accounts as per the extant norms.

(iii) Permissible currencies: QFIs will remit foreign inward remittance through normal banking channel in any permitted currency (freely convertible) directly into the single non-interest bearing Rupee account of the QFI maintained with an AD Category-I bank.

8. Reporting. In addition to the reporting to SEBI as may be prescribed by them, QDPs and AD Category-I banks (maintaining QFI accounts) will also ensure reporting to the Reserve Bank of India in a manner and format as prescribed by the Reserve Bank of India from time to time.]

276[SCHEDULE 9

[See Regulation 5(9)]

SCHEME FOR ACQUISITION/TRANSFER BY A PERSON RESIDENT OUTSIDE INDIA OF CAPITAL CONTRIBUTION OR PROFIT SHARE OF LIMITED LIABILITY PARTNERSHIPS (LLPS)

The Scheme shall be called Foreign Direct Investment (FDI-LLP) in Limited Liability Partnerships (LLP) formed and registered under the Limited Liability Partnership Act, 2008.

1. Eligible Investors. A person resident outside India or an entity incorporated outside India shall be eligible investor for the purpose of FDI in LLPs. However, the following persons shall not be eligible to invest in LLPs:

(i) a citizen/entity of Pakistan and Bangladesh or

(ii) a SEBI registered Foreign Institutional Investor (FII) or

(iii) a SEBI registered Foreign Venture Capital Investor (FVCI) or

(iv) a SEBI registered Qualified Foreign Investor (QFI) or

(v) a Foreign Portfolio Investor registered in accordance with Securities Exchange Board of India (Foreign Portfolio Investors) Regulations, 2014 (RFPI).

2. Eligibility of LLP for accepting foreign Investment. (i) A LLP, existing or new, operating in sectors/activities where 100% FDI is allowed under the automatic route of FDI Scheme would be eligible to receive FDI. For ascertaining such sectors, reference shall be made to Annex B to Schedule 1 of Notification No. FEMA. 20/2000-RB, dated 3rd May, 2000 as amended from time to time.

(ii) A LLP engaged in following sectors/activities shall not be eligible to accept (FDI):

(a) Sectors eligible to accept 100% FDI under automatic route but are subject to FDI-linked performance related conditions (for example minimum capitalisation norms applicable to Non-Banking Finance Companies or Development of Townships, Housing, Built-up infrastructure and Construction-development projects , etc.); or

(b) Sectors eligible to accept less than 100% FDI under automatic route; or

(c) Sectors eligible to accept FDI under Government Approval route; or

(d) Agricultural/plantation activity and print media; or

(e) Sectors ineligible to accept FDI i.e. any sector which is prohibited under extant FDI policy Annex A to Schedule 1 to Notification No. FEMA 20/2000-RB, dated 3rd May 2000) as well as sectors/activities prohibited in terms of Regulation 4(b) to Notification No. FEMA 1/2000-RB, dated 3rd May, 2000 as amended from time to time.

3. Eligible investment. Contribution to the capital of an LLP would be an eligible investment under the scheme.

Note. Investment by way of profit share will fall under the category of reinvestment of earnings.

277[4. Entry Route. FDI in LLPs is permitted, subject to the following conditions:

i. FDI is permitted under the automatic route in LLPs operating in sectors/activities where 100% FDI is allowed through the automatic route and there are no FDI linked performance conditions.

ii. An Indian company or an LLP, having foreign investment, will be permitted to make downstream investment in another company or LLP engaged in sectors in which 100% FDI is allowed under the automatic route and there are no FDI-linked performance conditions. Onus shall be on the Indian company/LLP accepting downstream investment to ensure compliance with the above conditions.

iii. FDI in LLP is subject to the compliance of the conditions of LLP Act, 2008.]

5. Pricing. FDI in a LLP either by way of capital contribution or by way of acquisition/transfer of profit shares, would have to be more than or equal to the fair price as worked out with any valuation norm which is internationally accepted/adopted as per market practice (hereinafter referred to as fair price of capital contribution/profit share of an LLP ) and a valuation certificate to that effect shall be issued by the Chartered Accountant or by a practicing Cost Accountant or by an approved valuer from the panel maintained by the Central Government.

In case of transfer of capital contribution/profit share from a resident to a non-resident, the transfer shall be for a consideration equal to or more than the fair price of capital contribution/profit share of an LLP. Further, in case of transfer of capital contribution/profit share from a non-resident to resident, the transfer shall be for a consideration which is less than or equal to the fair price of the capital contribution/profit share of an LLP.

6. Mode of payment for an eligible investor. Payment by an eligible investor towards capital contribution of LLPs will be allowed only by way of cash consideration to be received

(i) by way of inward remittance through normal banking channels; or

(ii) by debit to NRE/FCNR(B) account of the person concerned, maintained with an AD Category-I bank.

7. Reporting. (i) LLPs shall report to the Regional Office concerned of the Reserve Bank, the details of the receipt of the amount of consideration for capital contribution and profit shares in Form FOREIGN DIRECT INVESTMENT-LLP(I) as specified by Reserve Bank from time to time, together with a copy/ies of the FIRC/s evidencing the receipt of the remittance along with the KYC report on the non-resident investor, through an AD Category-I bank, and valuation certificate (as per Paragraph 4 above) as regards pricing at the earliest but not later than 30 days from the date of receipt of the amount of consideration. The report would be acknowledged by the Regional Office concerned, which would allot a Unique Identification Number (UIN) for the amount reported.

(ii) The AD Category-I bank in India, receiving the remittance should obtain a KYC report in respect of the foreign investor from the overseas bank remitting the amount.

(iii) Disinvestment/transfer of capital contribution or profit share between a resident and a non-resident (or vice versa) shall required to be reported within 60 days from the date of receipt of funds in Form FOREIGN DIRECT INVESTMENT-LLP(II) as specified by Reserve Bank from time to time.

278[(iv) All LLPs which have received Foreign Direct Investment in the previous year(s) including the current year shall submit to the Reserve Bank of India, on or before the 15th day of July of each year, a report titled Annual Return on Foreign Liabilities and Assets as specified by the Reserve Bank from time to time]

279[* * *]

9. Other Conditions. (i) In case an LLP with FDI has a body corporate as a designated partner or nominates an individual to act as a designated partner in accordance with the provisions of Section 7 of the Limited Liability Partnership Act, 2008, such a body corporate should only be a company registered in India under the provisions of the Companies Act, as applicable and not any other body, such as an LLP or a Trust. For such LLPs, the designated partner resident in India , as defined under the Explanation to Section 7(1) of the Limited Liability Partnership Act, 2008, would also have to satisfy the definition of person resident in India , as prescribed under Section 2(v)(i) of the Foreign Exchange Management Act, 1999.

(ii) The designated partners will be responsible for compliance with all the above conditions and also liable for all penalties imposed on the LLP for their contravention, if any.

(iii) Conversion of a company with FDI, into an LLP, will be allowed only if the above stipulations (except the stipulation as regards mode of payment) are met and with the prior approval of FIPB/Government.

(iv) LLPs shall not be permitted to avail External Commercial Borrowings (ECBs).

10. The LLP which have received foreign investment between May 20, 2011 to the date of issuance of instructions issued in this regard by Reserve Bank shall comply with the reporting requirement in respect of FDI within 30 or 60 days, as applicable, from the date of issuance of these instructions.

Form FOREIGN DIRECT INVESTMENT-LLP (I)

(To be filed by the LLP through its Authorised Dealer Category-I bank, with the Regional Office of the Reserve Bank under whose jurisdiction the Registered Office of the Limited Liability Partnership making the declaration is situated, not later than 30 days from the date of receipt of the amount of consideration)

280[SCHEDULE 10

[See Regulation (13-A)]

Issue/transfer of eligible securities to a foreign depository for the purpose of issuance of depository receipts by eligible person(s)

(a) in which a person resident outside India is allowed to invest under Schedules 1, 2, 2-A, 3, 5 and 8 of these regulations shall be eligible securities for issue of Depository Receipts in terms of Depository Receipts Scheme, 2014 (DR Scheme 2014).

(b) A person will be eligible to issue or transfer eligible securities to a foreign depository for the purpose of issuance of depository receipts as provided in DR Scheme, 2014.

(c) domestic custodian may purchase eligible securities on behalf of a person resident outside India, for the purpose of converting the securities so purchased into depository receipts in terms of, DR Scheme, 2014.

(d) The aggregate of eligible securities which may be issued or transferred to foreign depositories, along with eligible securities already held by persons resident outside India, shall not exceed the limit on foreign holding of such eligible securities under the extant Foreign Exchange Management regulations, as amended from time to time.

(e) The eligible securities shall be issued/transferred to a foreign depository for the purpose of issue of depository receipts in accordance with the DR Scheme, 2014 and guidelines issued by Central Government thereunder from time to time.

II. Pricing of eligible Securities. The eligible securities shall not be issued or transferred to a foreign depository for the purpose of issuing depository receipts at a price less than the price applicable to a corresponding mode of issue or transfer of such securities to domestic investors under FEMA, 1999 as amended from time to time.

III. Reporting Requirements. The issue of depository receipts as per DR Scheme, 2014 shall be reported to the Reserve Bank by the domestic custodian in such formats and in such manner as may be prescribed by the Reserve Bank from time to time.

IV. Depository Receipts issued under the Issue of Foreign Currency Convertible Bonds and Ordinary Shares (Through Depository Receipt Mechanism) Scheme, 1993 shall be deemed to have been issued under the corresponding provisions of DR Scheme, 2014 and have to comply with the provisions laid out in this Schedule.

281[SCHEDULE 11

[See Regulation 5(10)]

INVESTMENT BY A PERSON RESIDENT OUTSIDE INDIA IN AN INVESTMENT VEHICLE

1. A person resident outside India including an RFPI and an NRI may invest in units of Investment Vehicles subject to the conditions laid down in this Schedule.

2. The payment for the units of an Investment Vehicle acquired by a person resident or registered/incorporated outside India shall be made by an inward remittance through the normal banking channel including by debit to an NRE or an FCNR account.

3. A person resident outside India who has acquired or purchased units in accordance with this Schedule may sell or transfer in any manner or redeem the units as per regulations framed by SEBI or directions issued by RBI.

4. Downstream investment by an Investment Vehicle shall be regarded as foreign investment if either the Sponsor or the Manager or the Investment Manager is not Indian owned and controlled as defined in Regulation 14 of the principal regulations:

Provided that for sponsors or managers or investment managers organized in a form other than companies or LLPs, SEBI shall determine whether the sponsor or manager or investment manager is foreign owned and controlled.

Explanation 1: Ownership and control is clearly determined as per the extant FDI policy. AIF is a pooled investment vehicle. Control of the AIF should be in the hands of sponsors and managers/investment managers , with the general exclusion to others. In case the sponsors and managers/investment managers of the AIF are individuals, for the treatment of downstream investment by such AIF as domestic, sponsors and managers/investment managers should be resident Indian citizens.

Explanation 2: The extent of foreign investment in the corpus of the Investment Vehicle will not be a factor to determine as to whether downstream investment of the Investment Vehicle concerned is foreign investment or not.

5. Downstream investment by an Investment Vehicle that is reckoned as foreign investment shall have to conform to the sectoral caps and conditions/restrictions, if any, as applicable to the company in which the downstream investment is made as per the FDI Policy or Schedule 1 of the principal regulations.

6. Downstream investment in an LLP by an Investment Vehicle that is reckoned as foreign investment has to conform to the provisions of Schedule 9 of the principal Regulations as well as the extant FDI policy for foreign investment in LLPs.

7. An Alternative Investment Fund Category III with foreign investment shall make portfolio investment in only those securities or instruments in which a Registered Foreign Portfolio Investor is allowed to invest under the principal regulations.

8. The Investment Vehicle receiving foreign investment shall be required to make such report and in such format to Reserve Bank of India or to SEBI as may be prescribed by them from time to time.]

282[ANNEX A

FDI is prohibited in:

(a) Lottery Business including Government/private lottery, online lotteries, etc.

(b) Gambling and Betting including casinos etc.

(c) Chit funds

(d) Nidhi company

(e) Trading in Transferable Development Rights (TDRs)

(f) Real Estate Business or Construction of Farm Houses

(g) Manufacturing of Cigars, cheroots, cigarillos and cigarettes, of tobacco or of tobacco substitutes

(h) Activities/sectors not open to private sector investment e.g. Atomic Energy and Railway Transport (other than Mass Rapid Transport Systems).

Note: Foreign technology collaboration in any form including licensing for franchise, trademark, brand name, management contract is also prohibited for Lottery Business and Gambling and Betting activities.]

283[ANNEX B

Sector-specific policy for foreign investment

In the following sectors/activities, FDI up to the limit indicated against each sector/activity is allowed, subject to applicable laws/regulations; security and other conditionalities. In sectors/activities not listed below, FDI is permitted up to 100% on the automatic route, subject to applicable laws/regulations; security and other conditionalities.

Wherever there is a requirement of minimum capitalization, it shall include share premium received along with the face value of the share, only when it is received by the company upon issue of the shares to the non-resident investor. Amount paid by the transferee during post-issue transfer of shares beyond the issue price of the share, cannot be taken into account while calculating minimum capitalization requirement.

298[* * *]

1. Vide G.S.R. 406(E), dated 3-5-2000, published in the Gazette of India, Extra., Part II, Section 3(i), dated 8-5-2000.

2. Ins. by G.S.R. 413(E), dt. 9-6-2006 (w.r.e.f. 8-11-2005).

3. Subs. by G.S.R. 896(E), dated 22-8-2008 (w.r.e.f. 1-5-2007)

4. Added by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

5. Ins. by G.S.R. 465(E), dated 28-4-2016 (w.e.f. 28-4-2016).

6. Ins. by G.S.R. 16(E), dated 10-1-2017 (w.e.f. 10-1-2017).

7. Ins. by G.S.R. 835(E), dated 3-10-2003 (w.e.f. 23-10-2003).

8. Ins. by G.S.R. 896(E), dated 22-8-2008 (w.r.e.f. 1-5-2007).

9. Ins. by G.S.R. 896(E), dated 22-8-2008 (w.r.e.f. 8-6-2007).

10. Ins. by G.S.R. 914(E), dated 15-12-2014 (w.e.f. 15-12-2014).

11. Ins. by G.S.R. 606(E), dated 7-3-2012 (w.r.e.f. 22-7-2009).

12. Ins. by G.S.R. 914(E), dated 15-12-2014 (w.e.f. 15-12-2014).

13. Added by G.S.R. 484(E), dated 11-6-2015 (w.e.f. 11-6-2015).

14. Added by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

15. Ins. by G.S.R. 175(E), dated 26-12-2000 (w.e.f. 13-3-2001).

16. Ins. by G.S.R. 712(E), dated 17-10-2007 (w.e.f. 14-11-2007).

17. Ins. by G.S.R. 683(E), dated 4-10-2013 (w.r.e.f. 3-6-2013).

18. Ins. by G.S.R. 606(E), dated 7-3-2012 (w.r.e.f. 22-7-2009).

19. Deleted by G.S.R. 465(E), dated 28-4-2016 (w.e.f. 28-4-2016).

20. Ins. by G.S.R. 166(E), dated 15-2-2016 (w.e.f. 15-2-2016).

21. Subs. by G.S.R. 165(E), dated 15-2-2016 (w.e.f. 15-2-2016).

22. Added by FEMA. 297/2014-Rb, dated 13-3-2014.

23. Omitted by G.S.R. 558(E), dated 18-6-2003 (w.e.f. 22-7-2003).

24. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 9-8-2011).

25. Explanation deleted by G.S.R. 829(E), dated 17-10-2014 (w.e.f. 21-11-2014).

26. Ins. by G.S.R. 465(E), dated 28-4-2016 (w.e.f. 28-4-2016).

27. Added by G.S.R. 484(E), dated 11-6-2015 (w.e.f. 11-6-2015).

28. Ins. by G.S.R. 175(E), dated 26-12-2000 (w.e.f. 13-3-2001).

29. Ins. by Noti. No. FEMA.251/2012-RB, dated 6-12-2012 (w.r.e.f. 26-9-2011).

30. Subs. by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

31. Ins. by G.S.R. 805(E), dated 12-11-2013 (w.e.f. 30-12-2013).

32. Ins. by G.S.R. 713(E), dated 23-10-2007 (w.e.f. 14-11-2007).

33. Subs. for shares and convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

34. Ins. by G.S.R. 945(E), dated 25-9-2012 (w.r.e.f. 15-9-2011).

35. Subs. for shares and convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

36. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

37. Ins. by G.S.R. 821(E), dated 7-3-2012 (w.r.e.f. 12-4-2010).

38. Added by Noti. No. FEMA. 297/2014. RB, dated 13-3-2014.

39. Added by Noti. No. FEMA. 297/2014. RB, dated 13-3-2014.

40. Proviso omitted by G.S.R. 505(E), dated 22-7-2005 (w.e.f. 25-7-2005).

41. Proviso omitted by G.S.R. 344(E), dated 7-1-2013 (w.e.f. 29-5-2013). Prior to substitution it read as: Provided further that Foreign Institutional Investors shall not invest in the paid up equity capital of Asset Reconstruction Companies. .

42. Subs. by G.S.R. 4(E), dated 29-11-2001 (w.e.f. 29-11-2001).

43. Subs. by G.S.R. 165(E), dated 15-2-2016 (w.e.f. 15-2-2016).

44. Subs. by G.S.R. 712(E), dated 17-10-2007, for sub-regulation (4) (w.e.f. 14-11-2007).

45. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 9-8-2011).

46. Ins. by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

47. Subs. by G.S.R. 465(E), dated 28-4-2016 (w.e.f. 28-4-2016).

48. Proviso omitted by G.S.R. 505(E), dated 22-7-2005 (w.e.f. 25-7-2005).

49. Subs. by G.S.R. 896(E), dated 22-8-2008 (w.r.e.f. 31-12-2007).

50. Added by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

51. Added by G.S.R. 225(E), dated 17-1-2003 (w.e.f. 18-3-2003).

52. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 13-1-2012).

53. Added by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

54. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.e.f.. 30-10-2012).

55. Subs. for sub-regulations (1) to (7) by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

56. Ins. by G.S.R. 606(E), dated 7-3-2012 (w.r.e.f. 22-7-2009).

57. Ins. by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

58. Added by G.S.R. 223(E), dated 12-11-2002 (w.e.f. 18-3-2003).

59. Clause (ii) renumbered as clause (iii) by G.S.R. 223(E), dated 12-11-2002 (w.e.f. 18-3-2003).

60. Subs. by G.S.R. 341(E), dated 7-4-2010 (w.e.f. 21-4-2010).

61. Ins. by G.S.R. 558(E), dated 18-6-2003 (w.e.f. 22-7-2003).

62. Subs. by G.S.R. 896(E), dated 22-8-2008 (w.e.f. 30-12-2008).

63. Subs. for right shares or bonus shares by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

64. Ins. by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

65. Ins. by G.S.R. 16(E), dated 10-1-2017 (w.e.f. 10-1-2017).

66. Omitted by G.S.R. 818(E), dated 4-10-1013 (w.e.f. 31-12-2013).

67. Subs. by G.S.R. 484(E), dated 11-6-2015 (w.e.f. 11-6-2015).

68. Subs. for shares and convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

69. Subs. for shares or debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

70. Added by G.S.R. 805(E), dated 12-11-2013 (w.e.f. 30-12-2013).

71. Subs. for market price determined on the floor of the recognised stock exchanges by G.S.R. 435(E), dated 23-5-2014 (w.e.f. 8-7-2014).

72. Subs. by G.S.R. 435(E), dated 23-5-2014 (w.e.f. 8-7-2014).

73. Subs. by G.S.R. 558(E), dated 18-6-2003 (w.e.f. 22-7-2003).

74. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

75. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

76. Omitted by G.S.R. 836(E), dated 3-10-2003 (w.e.f. 23-10-2003).

77. Provisos omitted by G.S.R. 796(E), dated 23-4-2012 (w.r.e.f. 31-3-2011). Prior to omission it read as: Provided that the person to whom the shares are being transferred, in terms of clauses (i) and (ii), has obtained prior permission of Central Government to acquire the shares if he has previous venture or tie up in India through investment in shares or debentures or a technical collaboration or a trade mark agreement or investment by whatever name called in the same field or allied field in which the Indian company whose shares are being transferred is engaged: Provided further that the restriction in clauses (i) and (ii) shall not apply to the transfer of shares to International Financial Institutions such as Asian Development Bank(ADB), International Finance Corporation(IFC), Commonwealth Development Corporation (CDC), Deutsche Entwicklungs Gescelscchaft (DEG) and transfer of shares of an Indian company engaged in Information Technology sector .

78. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

79. Subs. for Prior permission by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 4-11-2011).

80. Added by G.S.R. 202(E), dated 17-3-2005 (w.r.e.f. 4-10-2004).

81. Subs. by G.S.R. 504(E), dated 22-7-2005 (w.e.f. 25-7-2005).

82. Subs. by G.S.R. 945(E), dated 25-9-2012 (w.r.e.f. 15-9-2011). Prior to substitution it read as: (e) The value of security to be transferred by the donor together with any security transferred to any person residing outside India as gift in the calendar year does not exceed the rupee equivalent of USD 25,000. .

83. Subs. by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

84. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

85. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

86. Ins. by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

87. Subs. by G.S.R. 795(E), dated 30-10-2012 (w.r.e.f. 4-11-2011). Prior to substitution it read as: (b) any share/convertible debenture of an Indian Company whose activities fall under Annexure B to Schedule I, other than Item Nos. 1, 2 and 3 and subject to the Sectoral Limits specified therein, shall transfer such shares/debentures without prior approval of Government and RBI if the same is by way of sale subject to the following: (i) that the Indian Company whose shares or convertible debentures are proposed to be transferred is not engaged in rendering any financial service; (ii) that the transfer does not fall within the purview of the provisions of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations 1977; and (iii) that the concerned parties adhere to pricing guidelines, documentation and reporting requirements for such transfers, as may be specified by Reserve Bank from time to time. .

88. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

89. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

90. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

91. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

92. Deleted by G.S.R. 682(E), dated 4-10-2013 (w.e.f. 11-10-2013).

93. Subs. by G.S.R. 795(E), dated 30-10-2012 (w.r.e.f. 4-11-2011). Prior to substitution it read as: (c) any security by way of sale, shall make an application to the Reserve Bank for its approval if, (i) the activity of the Indian company, whose securities are being transferred, falls outside the Automatic Route, and the approval of the FIPB has been obtained for the said transfer; (ii) the activity of the Indian company whose securities are being transferred, falls under the financial services sector; (iii) the transfer falls within the purview of the provisions of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997;and (iv) the transfer is to take place at a price which falls outside the pricing guidelines specified by Reserve Bank, from time to time. Explanation. For the purpose of this regulation, financial services , shall mean service rendered by banking and non-banking companies regulated by the Reserve Bank, insurance companies regulated by Insurance Regulatory and Development Authority (IRDA) and other companies regulated by any other financial regulator, as the case may be. .

94. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

95. Ins. by G.S.R. 795(E), dated 30-10-2012 (w.r.e.f. 22-4-2009)

96. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

97. Clause (1) omitted by G.S.R. 202(E), dated 17-3-2005 (w.r.e.f. 4-10-2004).

98. Subs. by G.S.R. 202(E), dated 17-3-2005 (w.r.e.f. 4-10-2004).

99. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 4-11-2011).

100. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

101. Ins. by G.S.R. 532(E), dated 5-3-2013 (w.e.f. 5-8-2013).

102. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

103. Ins. by G.S.R. 591(E), dated 10-7-2013 (w.e.f. 4-9-2013).

104. Ins. by G.S.R. 537(E), dated 20-5-2016 (w.e.f. 20-5-2016).

105. Ins. by G.S.R. 851(E), dated 10-11-2009 (w.r.e.f. 11-7-2008).

106. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 2-5-2011).

107. Ins. by G.S.R. 370(E), dated 22-5-2014 (w.e.f. 30-5-2014).

108. Subs. by G.S.R. 914(E), dated 15-12-2014 (w.e.f. 15-12-2014).

109. Ins. by G.S.R. 393(E), dated 7-6-2013 (w.r.e.f. 13-2-2009).

110. Subs. by G.S.R. 166(E), dated 15-2-2016 (w.e.f. 15-2-2016).

111. Subs. for Schedule 1, 2, 3, 6 and 8 by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

112. Ins. by G.S.R. 823(E), dated 30-10-2015 (w.e.f. 30-10-2015).

113. Subs. by G.S.R. 823(E), dated 30-10-2015 (w.e.f. 30-10-2015).

114. Subs. by G.S.R. 166(E), dated 15-2-2016 (w.e.f. 15-2-2016).

115. Subs. by G.S.R. 166(E), dated 15-2-2016 (w.e.f. 15-2-2016).

116. Amended by G.S.R. 166(E), dated 15-2-2016 (15-2-2016).

117. Subs. by G.S.R. 558(E), dated 18-6-2003 (w.e.f. 22-7-2003).

118. Renamed by G.S.R. 896(E), dated 22-8-2008 (w.e.f. 30-12-2008).

119. Subs by G.S.R. 896(E), dated 22-8-2008 (w.e.f. 30-12-2008).

120. Annex D omitted by G.S.R. 341(E), dated 5-3-2013 (w.e.f. 28-5-2013).

121. Annex E omitted by G.S.R. 400(E), dated 26-5-2014 (w.e.f. 12-6-2014).

122. Annex F omitted by G.S.R. 341(E), dated 5-3-2013 (w.e.f. 28-5-2013).

123. Subs. for equity/preference/convertible preference shares and convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

124. Subs. by G.S.R. 945(E), dated 25-9-2012 (w.r.e.f. 15-9-2011). Prior to substitution it read as: (1) A person resident outside India referred to in clauses (i) and (ii) of sub-regulation (1) of Regulation 5, may purchase shares or convertible debentures issued by an Indian company up to the extent and subject to the terms and conditions set out in this Schedule. .

125. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

126. Omitted by G.S.R. 796(E), dated 23-4-2012 (w.r.e.f. 31-3-2011). (2) If the person purchasing the shares under this Scheme proposes to be a collaborator or proposes to acquire the entire shareholding of a new Indian company, he should obtain prior permission of Central Government if he has, as on January 12, 2005, an existing joint venture or technology transfer/trade mark agreement in the same field as that of such Indian company:

127. Ins. by G.S.R. 896(E), dated 22-8-2008 (w.r.e.f. 12-1-2005).

128. Subs. for shares by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

129. Subs. for shares by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

130. Subs. for shares by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

131. Subs. by G.S.R. 896(E), dated 22-8-2008, for sub-paragraph (1) (w.r.e.f. 10-2-2006).

132. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

133. Ins. by G.S.R. 823(E), dated 30-10-2016 (w.e.f. 30-10-2016).

134. Subs. for Provided by G.S.R. 823(E), dated 30-10-2015 (w.e.f. 30-10-2015).

135. Proviso deleted by G.S.R. 166(E), dated 15-2-2016 (w.e.f. 15-2-2016).

136. Subs. for shares by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

137. Sub-paragraph (2) omitted by G.S.R. 896(E), dated 22-8-2008 (w.e.f. 30-12-2008).

138. Subs. by G.S.R. 797(E), dated 29-5-2012 (w.r.e.f. 27-2-2009). Prior to substitution it read as: (2) A company which is a small scale industrial unit and which is not engaged in any activity or in manufacture of items included in Annexure A, may issue shares or convertible debentures to a person referred to in Paragraph 1, to the extent of 24% of its paid-up capital: Provided that such a company may issue shares in excess of 24% of its paid up capital if (a) it has given up its small scale status; (b) it is not engaged or does not propose to engage in manufacture of items reserved for small scale sector, and (c) it complies with the ceilings specified in Annexure B. .

139. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

140. Subs. by G.S.R. 797(E), dated 29-5-2012 (w.r.e.f. 27-2-2009). Prior to substitution it read as: (3) Notwithstanding anything contained in clause (3) an Export Oriented Unit or a Unit in Free Trade Zone or in Export Processing Zone or in a Software Technology Park or in an Electronic Hardware Technology Park may issue shares or convertible debentures to a person resident outside India referred to in Paragraph 1 in excess of 24 per cent provided it complies with the ceilings specified in Annexure B. .

141. Subs. for shares by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

142. Subs. for shares by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

143. Subs. for shares by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

144. Subs. for shares by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

145. Ins. by G.S.R. 796(E), dated 23-4-2012 (w.r.e.f. 31-3-2011).

146. Ins. by G.S.R. 632(E), dated 10-7-2014 (w.e.f. 2-9-2014).

147. Added by G.S.R. 166(E), dated 15-2-2016 (w.e.f. 15-2-2016).

148. Ins. by G.S.R. 1002(E), dated 24-10-2016 (w.e.f. 24-10-2016).

149. Subs. by G.S.R. 796(E), dated 23-4-2012 (w.r.e.f. 31-3-2011).

150. Deleted by G.S.R. 166(E), dated 15-2-2016 (w.e.f. 15-2-2016).

151. Subs. for including second-hand machinery by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 10-4-2012).

152. Para 4 deleted by G.S.R. 914(E), dated 15-12-2014 (w.e.f. 15-12-2014).

153. Para 4-A deleted by G.S.R. 914(E), dated 15-12-2014 (w.e.f. 15-12-2014).

154. Para 4-B deleted by G.S.R. 914(E), dated 15-12-2014 (w.e.f. 15-12-2014).

155. Subs. by G.S.R. 341(E), dated 7-4-2010 (w.e.f. 21-4-2010).

156. Subs. by G.S.R. 435(E), dated 23-5-2014 (w.e.f. 8-7-2014).

157. Omitted by G.S.R. 435(E), dated 23-5-2014 (w.e.f. 8-7-2014).

158. Paragraph 5-A omitted by G.S.R. 896(E), dated 22-8-2008 (w.e.f. 30-12-2008).

159. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 26-9-2012).

160. Para 6 deleted by G.S.R. 914(E), dated 15-12-2014 (w.e.f. 15-12-2014).

161. Subs. by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

162. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 2-5-2011).

163. Added by G.S.R. 799(E), dated 27-11-2004 (w.e.f. 1-10-2004).

164. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 1-4-2003).

165. Ins. by G.S.R. 737(E), dated 29-11-2007.

166. Subs. for debit to NRE/FCNR(B) account by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 2-5-2011).

167. Subs. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 30-5-2008).

168. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

169. Subs. for a report in form specified in Annex C to this Schedule by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

170. Added by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

171. Subs. for the date of issue of shares by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

172. Added by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

173. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 15-3-2011).

174. Subs. for a report titled Annual Return on Foreign Liabilities and Assets in the form specified in Annex E to this Schedule by G.S.R. 400(E), dated 26-5-2014 (w.e.f. 12-6-2014).

175. Omitted by G.S.R. 400(E), dated 26-5-2014 (w.e.f. 12-6-2014).

176. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 22-4-2009).

177. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

178. Deleted by G.S.R. 341(E), dated 5-3-2013 (w.e.f. 28-5-2013)

179. Subs. for shares or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

180. Renumbered by G.S.R. 795(E), dated 19-10-2012 (w.e.f. 30-10-2012).

181. Subs. for SHARES AND/OR CONVERTIBLE DEBENTURES by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

182. Subs. for shares and/or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

183. Subs. by G.S.R. 12(E), dated 1-1-2004 (w.e.f. 7-1-2004).

184. Subs. for shares and convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

185. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

186. Subs. for shares/debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

187. Subs. by G.S.R. 574(E), dated 20-9-2001 (w.e.f. 20-9-2001).

188. Subs. by G.S.R. 558(E), dated 18-6-2003 (w.e.f. 22-7-2003).

189. Subs. by G.S.R. 435(E), dated 23-5-2014 (w.e.f. 8-7-2014).

190. Ins. by G.S.R. 575(E), dated 22-2-2008 (w.r.e.f. 31-12-2007).

191. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

192. Subs. by G.S.R. 12(E), dated 1-1-2004 (w.e.f. 7-1-2004).

193. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

194. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

195. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

196. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 21-4-2010).

197. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

198. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

199. Subs. by G.S.R. 12(E), dated 1-1-2004 (w.e.f. 7-1-2004).

200. Sub-paragraph (2) omitted by G.S.R. 12(E), dated 1-1-2004 (w.e.f. 7-1-2004).

201. Sub-paragraph (3) re-numbered as sub-paragraph (2) by G.S.R. 12(E), dated 1-1-2004 (w.e.f. 7-1-2004).

202. Added by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

203. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

204. Subs. for shares and/or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

205. Subs. for shares and/or convertible debentures by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).

206. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (8-7-2014).

207. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (8-7-2014).

208. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (8-7-2014).

209. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (8-7-2014).

210. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (8-7-2014).

211. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (8-7-2014).

212. Subs. by G.S.R. 435(E), dated 23-5-2014 (w.e.f. 8-7-2014).

213. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (8-7-2014).

214. Subs. for shares/convertible debentures by G.S.R. 436(E), dated 30-6-2014 (8-7-2014).

215. Subs. by G.S.R. 165(E), dated 15-2-2016 (w.e.f. 15-2-2016).

216. Subs. by G.S.R. 165(E), dated 15-2-2016 (w.e.f. 15-2-2016).

217. Subs. by G.S.R. 795(E), dated 19-10-2012 (w.e.f. 30-10-2012).

218. Subs. by G.S.R. 487(E), dated 2-7-2014 (w.e.f. 11-7-2014).

219. The word listed deleted by G.S.R. 1003(E), dated 24-10-2016 (w.e.f. 24-10-2016).

220. Subs. by G.S.R. 1015(E), dated 27-10-2015 (w.e.f. 27-10-2015).

221. Subs. for total holdings of all FIIs put together by G.S.R. 195(E), dated 26-3-2013 (w.e.f. 1-4-2013).

222. Subs. for provided that the investment by all FIIs in Perpetual Debt instruments (Tier I) by G.S.R. 195(E), dated 26-3-2013 (w.e.f. 1-4-2013)

223. The words The investment by FIIs in Debt capital instruments (Tier II) shall be within the limits stipulated by SEBI for FII investment in corporate debt deleted by G.S.R. 195(E), dated 26-3-2013 (w.e.f. 1-4-2013).

224. Deleted by G.S.R. 1003(E), dated 24-10-2016 (w.e.f. 24-10-2016).

225. The words subject to lock-in period and residual maturity as stipulated by the Reserve Bank and SEBI from time to time deleted by G.S.R. 195(E), dated 26-3-2013 (w.e.f. 1-4-2013).

226. Deleted by G.S.R. 1003(E), dated 24-10-2016 (w.e.f. 24-10-2016).

227. Ins. by G.S.R. 681(E), dated 4-10-2013 (w.e.f. 11-10-2013).

228. Ins. by G.S.R. 371(E), dated 22-5-2014 (w.e.f. 30-5-2014).

229. Ins. by G.S.R. 1003(E), dated 24-10-2016 (w.e.f. 24-10-2016).

230. Ins. by 795(E), dated 19-10-2012 (w.r.e.f. 9-8-2011)

231. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 16-7-2012).

232. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 9-8-2011).

233. Ins. by G.S.R. 195(E), dated 26-3-2013 (w.e.f. 1-4-2013).

234. Subs. by G.S.R. 487(E), dated 2-7-2014 (w.e.f. 11-7-2014).

235. Ins. by G.S.R. 681(E), dated 4-10-2013 (w.e.f. 11-10-2013).

236. Ins by G.S.R. 371(E), dated 22-5-2014 (w.e.f. 30-5-2014).

237. Omitted by G.S.R. 836(E), dated 3-10-2003 (w.e.f. 23-10-2003).

238. Added by G.S.R. 899(E), dated 22-11-2003 (w.e.f. 22-11-2003).

239. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 22-11-2011).

240. Subs. by G.S.R. 195(E), dated 26-3-2013 (w.e.f. .1-4-2013).

241. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 25-6-2012).

242. Subs. for dated Government securities, subject to the terms and conditions as stipulated by the SEBI and the Reserve Bank from lime to time. by G.S.R. 38(E), dated 19-1-2013 (w.e.f. 22-1-2013).

243. Subs. by G.S.R. 195(E), dated 26-3-2013 (w.e.f. 1-4-2013).

244. Subs. by G.S.R. 487(E), dated 2-7-2014 (w.e.f. 11-7-2014).

245. Subs. by G.S.R. 1015(E), dated 27-10-2016 (w.e.f. 27-10-2016).

246. Ins. by G.S.R. 681(E), dated 4-10-2013 (w.e.f. 11-10-2013).

247. Ins. by G.S.R. 371(E), dated 22-5-2014 (w.e.f. 30-5-2014).

248. Added by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

249. The word listed by G.S.R. 1003(E), dated 24-10-2016 (w.e.f. 24-10-2016).

250. Subs. by G.S.R. 1015(E), dated 27-10-2016 (w.e.f. 27-10-2016).

251. Deleted by G.S.R. 1003(E), dated 24-10-2016 (w.e.f. 24-10-2016).

252. Deleted by G.S.R. 1003(E), dated 24-10-2016 (w.e.f. 24-10-2016).

253. Ins. by G.S.R. 371(E), dated 22-5-2014 (w.e.f. 30-5-2014).

254. Ins. by G.S.R. 1003(E), dated 24-10-2016 (w.e.f. 24-10-2016).

255. Omitted by G.S.R. 836(E), dated 3-10-2003 (w.e.f. 23-10-2003).

256. Subs. by G.S.R. 896(E), dated 22-8-2008 (w.r.e.f. 25-1-2006).

257. Subs. by G.S.R. 195(E), dated 26-3-2013 (w.e.f. 1-4-2013).

258. Ins. by G.S.R. 371(E), dated 22-5-2014 (w.e.f. 30-5-2014).

259. Added by G.S.R. 371(E), dated 22-5-2014 (w.e.f. 30-5-2014).

260. Added by G.S.R. 759(E), dated 6-10-2015 (w.e.f. 6-10-2015).

261. Added by Noti. No. FEMA 106/2003-RB, dated 27-10-2003 (27-10-2003).

262. Renumbered sub-para (2-C) by G.S.R. 759(E), dated 6-10-2015 (w.e.f. 6-10-2015).

263. Ins. by G.S.R. 712(E), dated 17-10-2007 (w.e.f. 14-11-2007).

264. Added by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

265. Ins. by G.S.R. 759(E), dated 6-10-2015 (w.e.f. 6-10-2015).

266. Added by G.S.R. 899(E), dated 22-11-2003 (w.e.f. 22-11-2003).

267. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 9-8-2011).

268. Subs. by G.S.R. 487(E), dated 2-7-2014 (w.e.f. 11-7-2014).

269. Added by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

270. Omitted by G.S.R. 836(E), dated 3-10-2003 (w.e.f. 23-10-2003).

271. Added by G.S.R. 899(E), dated 22-11-2003 (w.e.f. 22-11-2003).

272. Subs. by G.S.R. 465(E), dated 28-4-2016 (w.e.f. 28-4-2016).

273. Ins. by G.S.R. 606(E), dated 7-3-2012 (w.r.e.f. 22-7-2009).

274. Added by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

275. Ins. by G.S.R. 795(E), dated 19-10-2012 (w.e.f. 30-10-2012).

276. Ins. by G.S.R. 190(E), dated 13-3-2014 (w.r.e.f. 20-5-2011).

277. Amended by G.S.R. 166(E), dated 15-2-2016 (w.e.f. 15-2-2016).

278. Ins. by G.S.R. 745(E), dated 30-9-2015 (w.e.f. 30-9-2015).

279. Deleted by G.S.R. 166(E), dated 15-2-2016 (w.e.f. 15-2-2016).

280. Ins. by G.S.R. 914(E), dated 15-12-2014 (w.e.f. 15-12-2014).

281. Subs. by G.S.R. 166(E), dated 15-2-2016 (w.e.f. 15-2-2016).

282. Subs. by G.S.R. 795(E), dated 19-10-2012 (w.r.e.f. 20-9-2012).

283. Subs. by G.S.R. 597(E), dated 30-8-2013 (w.e.f. 22-8-2013).

284. Subs. by G.S.R. 165(E), dated 15-2-2016 (w.e.f. 15-2-2016).

285. Subs. by G.S.R. 1118(E), dated 7-12-2016 (w.e.f. 7-12-2016).

286. Subs. by G.S.R. 1118(E), dated 7-12-2016 (w.e.f. 7-12-2016).

287. Subs. for Foreign Institutional Investors by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

288. Subs. for FIIs Subs. by Noti. No. FEMA. 297/2014-RB, dated 13-3-2014.

289. Subs. by G.S.R. 1118(E), dated 7-12-2016 (w.e.f. 7-12-2016).

290. Subs. by G.S.R. 1118(E), dated 7-12-2016 (w.e.f. 7-12-2016).

291. Subs. by G.S.R. 1118(E), dated 7-12-2016 (w.e.f. 7-12-2016).

292. Subs. by G.S.R. 1015(E), dated 27-10-2016 (w.e.f. 27-10-2016).

293. Subs. by G.S.R. 17(E), dated 10-1-2017 (w.e.f. 10-1-2017).

294. Subs. by G.S.R. 369(E), dated 30-3-2016 (w.e.f. 30-3-2016).

295. Subs. by G.S.R. 879(E), dated 9-9-2016 (w.e.f. 9-9-2016).

296. Subs. by G.S.R. 1042(E), dated 4-11-2016 (w.e.f. 4-11-2016).

297. Subs. by G.S.R. 1118(E), dated 7-12-2016 (w.e.f. 7-12-2016).

298. Annex C omitted by G.S.R. 436(E), dated 30-6-2014 (w.e.f. 8-7-2014).