Save Rs 588 on a 2-Year Ad-Free CAclubindia Pro Membership. Subscribe Now!

Fdi in it company

Save Share

This query is : Open

W M (Querist)
Follow

30 June 2016 Are there any regulations regarding FDI in a Private Limited Company in the IT Sector, from FEMA, RBI, etc.?

The scene is that an NRI and a Resident are both being promoters of an IT Company. Is there any limit or regulation in the shares, or value of shares being subscribed by the NRI? For eg. attracting RBI Notification No. FEMA 205/2010 dated 7.4.2010, and the like?

I have been informed that FDI in IT sector hasn't any such regulations, by default. I just want to get confirmation on this point.

Saket Jain

Saket Jain (Expert)
Follow

01 July 2016 I thin IT is covered under automatic route. Shares needs to values as per DCF method and certificate needs to be obtained from Merchant banker or CA. Regards

Message likes : 1 times

W M

W M (Querist)
Follow

01 July 2016 Thank you sir, for answering. If shares need to be valued by DCF, is it still considered 'automatic route'?
Also, when should this be done, if the company is being promoted - upon receiving notice from RBI, or suo moto?

Once again, thank you very much for answering.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now