Checklist and Procedure for Allotment of Shares for FDI in India

Procedure of FDI in India under Automatic Route

Steps

Particulars

Details

Time Limits, If Any

Steps to be Taken Before Crediting of Funds

1

Share capital declaration Form on the letter head of the company

Share capital declaration has to be submitted to the bank (with Company seal and authorised signature) before the FDI can be credited to the Indian Companies bank account.

2

Know Your Client Report

If the foreign investor makes a first time FDI in India then Indian bank needs to know the details of foreign investor.

The Indian bank receiving the FDI will require a KYC report from the remitting bank (foreign bank).

Indian bank needs to receive following information from the remitting bank (foreign bank) before crediting the amount.

1. If remitter is an individual:

a. Passport No. (or any other UID no. with details of the document)
b. Permanent address
c. Account no.
d. Period of banking relationship with foreign remitter (foreign investor)

2. If the remitter is a non-individual:

a. Registered name
b. Registration no.
c. Registered address
d. Account no.
d. Period of banking relationship with foreign remitter (foreign investor)
 

Note: KYC will expire after 1 year which means that if the Indian company is receiving FDI in India for a period of over a year, the KYC will have to be renewed.

Post Credit Procedure for Filing FDI in India

3

Submission of FDI intimation Form

Following documents need to be submitted to bank (Authorized Dealer)

(i) FDI intimation Form
(ii) Covering letter
(iii) Foreign inward remittance certificate (FIRC) in original

Within 30 days of credit of funds

4

Allotment of shares

Indian Company shall convene a general meeting and board meeting and shall allot equity shares to the foreign investor
 

Note: If shares are not being allotted within the stipulated time, application money has to returned  to remitter OR RBI approval has to be sought for delay in issuance.

Within 180 days of credit of funds

5

Submission of FC-GPR Form

Following documents need to be submitted to bank (Authorized Dealer):

(i) Covering letter
(ii) Form FC-GPR (Part A)
(iii) Original FIRC
(iv) Certificate from Company Secretary of the company accepting investments from foreign (if the company doesn’t have full time CS, a certificate from PCS may be submitted)
(v) Certificate from CA or Statutory Auditors indicating manner of arriving at share price (using DCF method)
(vi) Copy of Letter of Intimation forwarded to RBI (as per step 3 above)
(vii) KYC report of foreign investor (remitting party) (would be already with us by then, refer step 2 above)
(viii) RBI approval for taking on record shares if already issued to non-resident share holder
(ix) MoA
(x) Board resolution approving the FDI in India

Note: As per RBI Circular no. 77 dated February 12, 2015 Form FC-GPR can also be filed online using portal - https://www.ebiz.gov.in/homebook

Within 30 days of allotment of shares

6

Form MGT-14

File Form MGT-14 with following attachments:

(i) Certified true copy of resolution passed at general meeting
(ii) Notice of general meeting and explanatory statement
 

Note: Ensure that filing of e-Form MGT-14 precedes filing of Form PAS-3

Within 30 days of allotment of shares

7

Form GNL-2

File Form GNL-2 with following attachments:

(i) Certified true copy of resolution passed at general meeting
(ii) Notice of general meeting and explanatory statement
(iii) Form PAS-4
(iv) Form PAS-5
 

Note: Ensure that filing of e-Form GNL-2 precedes filing of Form PAS-3 but not Form MGT-14

Within 30 days of allotment of shares

8

Return of Allotment in Form PAS-3 to RoC

File Form PAS-3 with following attachments:

(i) List of Allottees
(ii) Certified true copy of resolution passed at Board meeting
(iii) Valuation report from CA / Merchant Banker
(iv) Form PAS-5

Within 30 days of allotment of shares