[FEMA][Revised FC-GPR, KYC report & FIRC]Reporting under FDI Scheme - Revised procedure - Amendment

Dear All,

Reporting under FDI Scheme - Revised procedure

Circular Summary by Mr. G. Thirupal, Practising Company Secretary

In a nut shell,
-Format is prescribed for Advanced Reporting
-Advanced reporting should be signed by Authorised Dealer, apart from company
-Advanced report is routed through Authorised Dealer
-KYC made must for allotments in specific format
-KYC should be signed by the remitting bank on behalf of the non resident
-FC-GPR is revised comprehensively
-Now FC-GPR should be filed with RBI directly
-Practising Company Secretaries are recognized in providing certificates.

The RBI vide its APDIR Circular No.44 dated 30th May 2008 amended provisions of the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000, to modify reporting requirement through Form FC-GPR.

As you aware that In terms of para 9 (1) A of Schedule I to the Notification, Indian companies are required to report the details of the amount of consideration received for issuing shares and convertible debentures under the Foreign Direct Investment (FDI) scheme to the Regional Office of the Reserve Bank in whose jurisdiction the Registered Office of the company operates, within 30 days of receipt of the amount of consideration. Further, in terms of Para 9 (1) B of Schedule ibid, the companies are required to report the details of the issue of shares / convertible debentures in form FC-GPR, to the Regional Office concerned, within 30 days of issue of shares / convertible debentures.

Further, RBI vide its A. P. (DIR Series) Circular No.40 dated April 20, 2007 has revised FC-GPR In order to capture the details of FDI in a more comprehensive manner. The reporting framework was again reviewed and further revisions were proposed and the revised draft of form FC-GPR was placed in public domain on March 14, 2008 inviting feedback from the public. Based on the feedback received, form FC-GPR has been revised. The revised form is enclosed at Annex I. Further, a standard format for reporting of the receipt of the amount of consideration for issue of shares / convertible debentures has been prescribed as Annex II. A format for the KYC report on the non-resident investor from the overseas bank remitting the amount required to be submitted along with the form FC-GPR has also been introduced (Annex III). The KYC report should, henceforth, be submitted at the time of reporting the receipt of the amount of consideration from the non-resident investor.

Accordingly, Indian companies are required to report the details of the receipt of the amount of consideration for issue of shares / convertible debentures in Annex II, 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 in Annex III, through an AD Category – I bank, 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.

The details of the issue of shares / convertible debentures should, henceforth, be reported in the revised form FC-GPR (Annex I). While forwarding form FC-GPR to the Regional Office concerned, the AD Category – I bank should ensure that the UIN is correctly indicated in the form. It is also clarified that the annual report of all investments which is to be filed in Part B of the revised form FC-GPR, which is hitherto to be submitted by June 30 every year, would now have to be submitted by July 31 every year.

Thanks & Regards
Alagar
Investment Banking
Karvy Investor Services Limited
Chennai
Tel: 044-28151034/3445/3658
Moble: 919884731993/ 919790906827
e-mail: alagar.muthu@karvy.com