ESOP - no prior permission from RBI under FEMA
With a view to further liberalising overseas investment, it has now been decided that even in cases where the foreign company offering its shares under ESOP and has an indirect shareholding in the Indian company, i.e., through a Special Purpose Vehicle or a step down subsidiary, no prior permission of the Reserve Bank is required, as long as such holding is not less than 51 per cent.
RBI/2004-05/360 A.P. (DIR Series) Circular No. 32 dated February 09, 2005