- with readers working within the Technology industries
- within Transport and Intellectual Property topic(s)
This November newsletter covers categories of relevant updates notified by the Ministry of Corporate Affairs ("MCA") and the Reserve Bank of India ("RBI").
Ministry of Corporate Affairs ("MCA") amended the Companies (Meetings of Board and its Powers) Rules, 2014 ("MBP Rules")
November 3, 2025: Vide Notification G.S.R. 811(E), the MCA has amended Rule 11(2) of the MBP Rules. Rule 11 of the MBP Rules relates to loan and investment by a company under section 186 of the Companies Act, 2013. The amended rule now reads:
"(2) For the purposes of clause (a) of sub-section (11) of section 186 of the Act, the expression "business of financing industrial enterprises" shall include -
(i) with regard to a Non-Banking Financial Company registered with the Reserve Bank of India, "business of giving of any loan to a person or providing any guaranty or security for due repayment of any loan availed by any person in the ordinary course of its business" and
(ii) with regard to a Finance Company registered with the International Financial Services Centres Authority, "activities as provided in sub-clause (a), or sub-clause (e) of clause (ii) of sub-regulation (1) of regulation 5 of the International Financial Services Centres Authority (Finance Company) Regulations, 2021 in the ordinary course of its business."
The amendment has broadened the scope of what falls under 'business of financing industrial enterprises'.
RBI has notified the Foreign Exchange Management (Export of Goods and Services) (Second Amendment) Regulations, 2025
November 13, 2025: Vide Notification No. FEMA 23(R)/(7)/2025-RB, the RBI has notified the Foreign Exchange Management (Export of Goods & Services) (Second Amendment) Regulations, 2025 ("Amended Regulations"), to amend the Foreign Exchange Management (Export of Goods & Services) Regulations, 2015 ("Principal Regulations").
Vide the Amended Regulations, the RBI has made the following changes:
- Amendment to Regulation 9 - Period within which export value of
goods/software/ services to be realized:
- Regulation 9(1): The amount representing the full export value of goods / software/ services exported shall be realized and repatriated to India within 15 (fifteen) months or within such period as may be specified by the RBI, in consultation with the Government, from time to time, from the date of export (subject to certain conditions as mentioned in the Principal Regulations). Earlier, the timeline for realization and repatriation of such amount was 9 (nine) months.
- Regulation 2(a): Where the export of goods / software / services has been made by Units in Special Economic Zones (SEZ) / Status Holder exporter / Export Oriented Units (EOUs) and units in Electronics Hardware Technology Parks (EHTPs), Software Technology Parks (STPs) and Bio-Technology Parks (BTPs) as defined in the Foreign Trade Policy in force, then notwithstanding anything contained in sub-regulation (1), the amount representing the full export value of goods or software shall be realized and repatriated to India within 15 (fifteen) months or within such period as may be specified by the RBI, in consultation with the Government, from time to time, from the date of export. Earlier, the timeline for realization and repatriation of such amount was 9 (nine) months.
- Amendment to Regulation 15 - Advance payment against exports:
- Regulation 15(1)(i): Where an exporter receives advance payment (with or without interest), from a buyer / third party named in the export declaration made by the exporter, outside India, the exporter must ensure that the shipment of goods is made within 3 (three) years from the date of receipt of advance payment. Earlier, the above time limit for shipment of goods was 1 (one) year from the date of receipt of advance payment.
- Proviso to Regulation 15(1): In the event of the exporter's inability to make the shipment, partly or fully, within 3 (three) years from the date of receipt of advance payment, no remittance towards refund of unutilized portion of advance payment or towards payment of interest, shall be made after the expiry of the period of 3 (three) years, without the prior approval of the RBI. Earlier, the above time limit was for 1 (one) year.
- Regulation 15(2): Notwithstanding anything contained in Regulation 15(1)(i), an exporter may receive advance payment where the export agreement itself duly provides for shipment of goods extending beyond the period of 3 (three) years from the date of receipt of advance payment. Earlier, the above time limit was for 1 (one) year.
The Amended Regulations shall come into force from the date of their publication in the Official Gazette.
RBI has issued A.P. (DIR Series) Circular No. 15/2025-26 - Amendments to Directions (Compounding of Contraventions under FEMA, 1999)
November 24, 2025: Vide Circular RBI/FED/2025-26/98, the Reserve Bank of India has amended the Master Directions on compounding of contraventions under FEMA, 1999 dated April 22, 2025 ("Master Directions"), to streamline receipt of the compounding application fee and the 'sum for which a contravention is compounded' ("Compounding Amount").
Annexure I of the Master Directions has been modified to include the revised account details for receipt of the compounding application fee and Compounding Amount through National Electronic Fund Transfer (NEFT), Real Time Gross Settlement (RTGS).
All 'Authorized Persons' have been advised to bring these guidelines to the notice of their constituents.
RBI has issued A.P. (DIR Series) Circular No. 16/2025-26 - Compliance with Know Your Customer (KYC) norms
November 28, 2025: Vide Circular RBI/2025-26/99, the RBI has directed Authorized Persons ("AP") on compliance with Know Your Customer ("KYC") norms by referring to the relevant instructions in Master Directions - Money Changing Activities; Master Directions - Overseas Investment; Master Directions - Other Remittance Facilities; and Master Directions - Money Transfer Service Scheme.
As the earlier consolidated Master Direction - Know Your Customer (KYC) Direction, 2016 (now withdrawn) has been substituted, the RBI has provided the following directions:
- APs regulated by the Department of Regulation, RBI shall follow the respective KYC directions as applicable to them;
- APs not regulated by the Department of Regulation, RBI shall be governed by the RBI's (Non-Banking Financial Companies - Know Your Customer) Directions, 2025; and
- APs shall ensure compliance by their agents, sub-agents and franchisees.
The instructions are effective with immediate effect and related Master Directions are being modified accordingly.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
