Tag Archives: foreign direct investment

ILN Today Post

Changing landscape of the Indian Foreign Direct Investment Policy

The foreign direct investment (“FDI”) policy of India has in the recent past witnessed a series of reforms introduced by the Government with the aim of increasing FDI inflows into India inter alia by liberalizing FDI in various sectors and streamlining the approvals processes. According to the Ministry of Commerce and Industry, FDI inflows hit an all-time high of USD 60.1 billion in 2016-17 as compared to FDI inflows of USD 55.6 billion for the year ending March 2016, (as against record high of USD 139 billion FDI inflows in China in 2016).

Read full article
ILN Today Post

Liberalizations in the FDI Policy – Unshackling the Manufacturing Sector

  1. Introduction

1.1.         The Foreign Direct Investment (“FDI”) policy has been in a state of flux since last year, with sweeping changes being brought in with respect to FDI vis-à-vis various sectors. One such sector has been the ‘manufacturing sector’ which was defined and elaborated upon in the FDI policy, vide Press Note No. 12 of 2015 (dated November 24, 2015), last year (“Press Note 2015”).  

Read full article
ILN Today Post

RBI Issues New Pricing Guidelines for FDI

The Reserve Bank of India (“RBI”) has recently modified the existing pricing guidelines governing subscription to, or transfer of, shares of unlisted Indian companies by, or to, non-residents, and for exit from investment in equity shares with or without optionality clauses of unlisted Indian companies, vide its A.P. (DIR Series) Circular No. 4 dated July 15, 2014.

In terms of the above circular, henceforth, the issue and transfer of shares of unlisted Indian companies, including compulsorily convertible preference shares and compulsorily convertible debentures with or without optionality clauses, would be at a price worked out as per “any internationally accepted pricing methodology” on arm’s length basis, while ensuring that non-resident investors are not guaranteed any assured exit price on their investments. The investments with optionality clauses will, however, continue to be subject to a lock-in period of 1 (one) year in accordance with the A.P. (DIR Series) Circular No. 86 dated January 9, 2014 (refer our newsletter of January 31, 2014).

Read full article
ILN Today Post

Union Budget 2014 – 15: Key Highlights in Education and Changes in Foreign Direct Investment

The Union Budget 2014-15 was presented by Finance Minister Arun Jaitley in the Parliament on July 10, 2014. Here are some of the key highlights of the Budget relating to the education sector and to foreign direct investments in India:

Education – Waiver of Service Tax Exemption:

Read full article
ILN Today Post

SC: FDI up to 51% in Multi Brand Retail, not unconstitutional

On Wednesday, May 1, 2013 the Supreme Court of India (“SC”), reportedly dismissed a public interest litigation (“PIL”) filed by one Manohar Lal Sharma (“Petitioner”), providing a much awaited breather to the Government of India (“GoI”). The PIL was filed to challenge the notification of the GoI, permitting Foreign Direct Investment (“FDI”) up to 51% in multi brand retail in India (“Policy”).

The SC, whilst upholding the Policy, observed that there are enough examples of countries where small unorganized retailers have continued to co-exist with organized multinational retailers even after implementation of FDI and that the Policy will enlarge choices to consumers and do away with middlemen.

Read full article
ILN Today Post

SAFE Simplifies Forex Rules for Direct Investment

The Notice of the State Administration of Foreign Exchange on Further Improving and Adjusting Foreign Exchange Control Policies on Direct Investment (Circular 59) took effect on December 17, 2012. Circular 59 continues China’s policy of relaxing its foreign exchange control requirements and procedures. Of particular importance, it abolishes SAFE’s verification requirements for (1) foreign exchange capital account opening and settlement of preliminary direct investment costs, (2) reinvestment in China by foreign investors and foreign invested enterprises, including foreign invested “holding companies,” of foreign exchange profits and proceeds from equity transfers, (3) conversion of “foreign debt” (i.e. a properly registered foreign loan) to registered capital, and (4) conversion to and payment in foreign exchange by onshore companies for the purchase of offshore assets. In most cases, China’s designated foreign exchange banks are now charged with supervising these activities and SAFE retains extensive powers to supervise and discipline the banks. Circular 59 also simplifies capital verification procedures for foreign invested enterprises and registration procedures for the purchase by foreign investors and foreign invested enterprises of equity interests in onshore companies. More…

Read full article
ILN Today Post

FDI Policy of India Relaxed

The Department of Industrial Policy & Promotion, Ministry of Commerce and Industry, Government of India (“DIPP”) issued five Press Notes on September 20, 2012, to give effect to the Government of India’s (“GoI”) recent decision to relax foreign direct investment (“FDI”) in various sectors. We provide below, in brief, the key amendments effected by the Press Notes to the FDI Policy of India (“FDI Policy“):

Single Brand Retail Trading – The GoI had earlier permitted 100% FDI in single brand retail trading subject to certain restrictive conditions and riders, which were proving to be a deterrent for the brands wanting to enter the Indian retail segment. Given the industry’s lukewarm response thereto, GoI has finally relaxed some of the rather restrictive conditions and introduced new conditions as well:

Read full article
ILN Today Post

Multi Brand Retail and Other Big Ticket FDI Reforms on Track

The Government of India (“GoI”) on September 14, 2012 has finally decided to permit Foreign Direct Investment (“FDI”) in multi brand retail, a decision much awaited by the industry players and foreign investors. The decision to permit 51% FDI in multi brand retail will clear the way for a number of multi brand retailers to open stores in India. However, subject to final release of the notification for amending the FDI Policy of India, the permission to bring in FDI in multi brand retail is reportedly expected to come with certain conditions, which would, inter alia, include:

Read full article
ILN Today Post

Fifth Edition of the Consolidated FDI Policy Released by DIPP

The Department of Industrial Policy and Promotion, Ministry of Commerce and Industry, Government of India (“DIPP”) on April 10, 2012 released the fifth edition of the consolidated Foreign Direct Investment (“FDI”) Policy of India vide circular 1 of 2012.

The circular consolidates the extant FDI policy of India and has accordingly introduced, inter alia, the following revisions to the FDI Policy:

  1. FDI in Commodity Exchange – Foreign investment mandate in commodity exchange, which until now required approval from the Foreign Investment Promotion and Board (“FIPB”) under the composite cap of 49% for FDI as well as investment by Foreign Institutional Investor (“FIIs”) (26% for FDI and 23% for FIIs) has been liberalized. Henceforth, investment by FIIs, in commodity exchanges will not require prior FIPB approval. However, other than FII investment, FIPB approval will still be required for FDI in commodity exchanges. 
Read full article
ILN Today Post

Week of January 9, 2012 on ILNToday – A Roundup

It has been one busy week on ILNToday, with some excellent contributions from our members around the world! My top five posts for this week are:

  • Intellectual Property Bulletin of Kochanski Zieba Rapala & Partners: Our Polish experts at Kochanski Zieba Rapala & Partners delve into IP issues covering the question of whether opposition proceedings in a European patent case would have an impact on the Polish equivalent patent, and single color protection as trademark protection, which considers the details of the Louboutin case in the US.
  • International Litigation in London: Paul Howcroft of Fladgate is best known for his commentary on art law, but here, he gives us his litigation roundup for 2011 in London. 
Read full article