RBI Amends Condition Realting To Issue Of Equity Shares Under The Fdi Scheme Allowed Under The Government Route Against Preoperative/ Pre-Incorporation Expenses
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Reserve Bank of India reviewed the policy issued vide A.P.Circular No. 74 dated 20th June, 2011 read with A.P. Circular No. 55 dated 9th December, 2011 wherein it was allowed to issue equity shares/ preference shares under the Government route by conversion of import of capital goods, etc. subject to terms and conditions, stated therein.
Reserve Bank of India vide RBI/2012-13/502 A.P. (DIR Series)
Circular No. 104 dated 17th May, 2013 reviewed the policy issued
vide A.P. (DIR Series) Circular No. 74 dated 20th June, 2011 read
with A.P. (DIR Series) Circular No. 55 dated 9th December, 2011
wherein it was allowed to issue equity shares/ preference shares
under the Government route by conversion of import of capital
goods, etc. subject to terms and conditions, stated therein. On a
review it was decided to amend condition at Para 3(II)(c) of A.P.
(DIR Series) Circular No. 74 dated 20th June, 2011. Earlier, the
condition Para 3(II) (c) stated that "Payments should be made
directly by the foreign investor to the company. Payments made
through third parties citing the absence of a bank account or
similar such reasons will not be eligible for issuance of shares
towards FDI. The revised condition is as follows, "Payments
should be made by the foreign investor to the company directly or
through the bank account opened by the foreign investor as provided
under FEMA Regulations.
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