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Wednesday, July 2, 2008

[FEMA] Manufacturing / Educational - Registered Trust / Society - ODI in same sector in a JV / WoS with PRBI approval

Criteria for Overseas Investment by Registered Trust / Society

Registered Trusts and Societies engaged in manufacturing / educational sector & satisfying the below mentioned Eligibility Criteria, to make investment in the SAME sector(s) in a Joint Venture or Wholly Owned Subsidiary [JV / WoS] OUTSIDE India, with the PRIOR approval of the Reserve Bank (RBI), by submitting the application/s in Form ODI-Part I, through their AD Category - I bank/s.

Eligibility Criteria - Trust / Society 

i) The Trust / Society should be REGISTERED under the Indian Trust Act, 1882 / Societies Registration Act, 1860.
ii) The TRUST DEED permits the proposed investment overseas.  In case of Society, the Memorandum of Association and rules and regulations PERMIT the Society to make the proposed investment which should also be APPROVED by the governing body / council or a managing / executive committee.
iii) The proposed investment should be APPROVED by the TRUSTEE/s.
iii) The Authorised Dealer bank is satisfied that the Trust is KYC (Know Your Customer) COMPLIANT and is engaged in a bonafide activity.
iv) The Trust / Society has been in EXISTENCE at least for a period of THREE years.
v) The Trust / Society has NOT come under the adverse notice of any Regulatory / Enforcement agency like the Directorate of Enforcement, CBI etc.

In ADDITION to the registration, the activities which require SPECIAL LICENSE / PERMISSION either from the Ministry of Home Affairs, Government of India or from the relevant local authority, as the case may be, the Authorised Dealer Category – I bank should ensure that such special license / permission has been obtained by the applicant.

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