Query for allotment of shares to foreign Company

[VIKAS GUPTA]

Hello Friends,

 

Can anybody tell me the procedures and compliances of allotment of shares to Foreign Company? What kind of approvals are needed and other complainces?

--
THANKYOU
CS VIKAS GUPTA
Company Secretary
Shree Krishna Paper Mills & Industries Ltd.
vikas...@skpmil.com
9953620278

[veena iyer]

Since allotment of shares is to a foreign company, it will come under FEMA regulations. First of all there should be an inward remittance of the amount for which the shares are to be allotted, from the place where the foreign company is situated, to India. Then a return in the form prescribed by RBI, intimating the receipt of the inward remittance together with the copy of FIRC should be filed with RBI within 30 days from the date of  receipt of inward remittance. The shares should be allotted within 6 months from the date of  receipt of inward remittance and once the shares are allotted, Form FC-GPR, Part A should be filed with the RBI within 30 days from the date of allotment. Also valuation certificate from a Chartered Accountant as regards the price of the shares and also a declaration from the Company Secretary (In Employment or Practice as the case may be) should be obtained. The above two documents are attachments to FC-GPR. Check whether the FDI is through automatic or approval route, If through approval route, then attach the copy of the approval letter from Central Government, to the FC-GPR form. Normal secretarial procedures like passing a Board Resolution for allotment of shares will apply. Regards CS Veena Iyer wit56...@yahoo.co.in --- On Mon, 30/5/11, VIKAS GUPTA <vickyp...@gmail.com> wrote:

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[VIKAS GUPTA]

Thanks Madam,

 

But I want to know that foreign company which are invested in our company is treated as Overseas Corporate Body as per Foreign Exchange Management Act? if yes, then what about mentioned circular no. 14 dated 16th  sept. 2003 regarding restriction to Overseas Corporate Body in Indian securities. As we did allotment in 2003 then that foreign company is treated as Overseas Corporate Body

 

And if the foreign company is considered as any other term then which regulation will apply as per FEMA to that foreign company??

 

Basically what the foreign company considered as in this transaction??

[veena iyer]

Dear Vikas Kindly provide me with the following information to answer your query. 1. Date of incorporation of the Company 2. exact date of allotment made (DD/MM/YYYY) 3. The locations of both the foreign company and the company that allotted shares to the foreign company. 4. The shareholding pattern of the Company.

Regards CS Veena Iyer wit56...@yahoo.co.in

[VIKAS GUPTA]

Dear Veena,

 

1. the Company was incorporated in September, 1972.

2. Allotment date is yet to be decided.

3. singapore

4. it is closely held company. on stock exchange 39.38% are public shareholding but in actual we are holding more than 90 % of the shares.

[veena iyer]

Dear Vikas   As per the RBI circular dated 16th Sep, 2003, the OCBs have been de recognised and so the Company shall be treated as Foreign Corporate Body. Regulation 5(1) of RBI Notification No. 20/2000-RB dated May 3, 2000 shall apply and as I said below, the following procedures are to be adopted.   Learned members can correct me if am wrong in any of the matters.