Overseas Direct Investment - Liberalisation/ Rationalisation - RBI Instructions
TRANSFER by way of sale of shares of a JV / WOS: An Indian Party, without prior approval of the Reserve Bank, may transfer by way of sale to another Indian Party which complies with the provisions of Regulation 6 of FEMA Notification 120/RB-2004 dated July 7, 2004 or to a person resident outside India, any share or security held by it in a JV or WOS outside India subject to the certain conditions:
Transfer by way of sale of shares of a JV / WOS involving write off of the investment: Indian Parties may disinvest without prior approval of the Reserve Bank, in certain specified cases where the amount repatriated on disinvestment is less than the amount of the original investment.
The Indian Party is required to submit details of such disinvestment through its designated AD category-I bank within 30 days from the date of disinvestment.
An Indian Party, which does not satisfy the specified conditions for undertaking any disinvestment in its JV/WOS abroad, shall have to apply to the Reserve Bank for prior permission.
Necessary amendments to the Foreign Exchange Management (Transfer or Issue of Any Foreign Security), Regulations, 2004 are being issued separately.
Circular NO. 73/RBI.,Dated: June 29, 2011