FEMA Compliance - Loan

Hello,

In terms of Regulation 6 of the Notification, an Indian party has been permitted to make investment in overseas Joint Ventures (JV) / Wholly Owned Subsidiaries (WOS), not exceeding 400 per cent of the net worth2 of the Indian party, i.e. a company incorporated in India or a body created under an Act of Parliament or a partnership firm registered under the Indian Partnership Act, 1932, making investment in a JV/WOS abroad and includes any other entity in India excluding individuals as may be notified by the Reserve Bank as on the date of the last audited balance sheet.

In view of the above , Mr X can not make loan to a Singapore Company under automatic route and prior approval from RBI is needed for this.

Regards,

R.V.Seckar

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Sekarji is a familiar face in CS Mysore Google Groups. Sir, you have joined this Club as well.

Welcome to the CA Club and hope to get your expert  and valuable contributions on FEMA  and Corporate Law..

Is the following possible with respect to Regulation 6:

Can Indian person either in his individual capacity or his proprietary business  start a company in Singapore with 50% share with a person residing Singapore.