28 November 2016
Our Investor is a Dubai Company and due to some compliance they want to invest in Dubai Company only. So they asked us to set up a Co. in dubai and make it as a holding Company of our Indian. Co. So the Holding Dubai Company will issue preference shares to the Investor Dubai Co. and hence the fund will flow to our Indian Company.
Is it Right process or is there any other option to brings funds from Dubai and what are the Compliance??
28 November 2016
Thanks....What are the other options available for our Indian Co. to get funds from this Dubai Co. wherein they have a condition to provide funds in Dubai Only..
28 November 2016
Ok.... I'm summerising the process plz guide if it is right and in sequence..
Option 1
1. Dubai Co. formed by Indian Co. Directors will issue shares at premium to Dubai Investor Company. 2. Dubai Co. will get funds and it will propose to buy shares of our Indian Co. 3. Our Indian Co. will transfer or issue new shares to Dubai Company..Proximately 20% of holding 4. Funds will flow from Dubai to Indian Co.
Note: We do not want to dilute control..hence by issuing prefrence shares to Dubai Holding Co.. will it fulfill our purpose? We have to intimate RBI for inflow of Foreign Funds and need to file FCGPR in due time..
28 November 2016
The above proposal will not work out except sl. No. 1. You said initially the Dubai company will be holding company of Indian company Holding company should have more than 50% equity shares. Only equity shares to be issued not preference shares.
28 November 2016
Ok Sir, Indian Co. need to issue shares to Dubai Co. inorder to get funds from them which they received from another Dubai Co....It can be by way of sale of equity or Prefernce..mistakenly I said Holding Co. Now will the above mentioned sequence works..
CAclubindia
