Compliance for cross border transactions is quite cumbersome in India & is a common irritant for most companies. An increased flow of funds, inbound as well as outbound has increased the level of check on compliances in context of foreign exchange. A need arises with the Corporate to keep a regular eye on foreign exchange transactions, in context of sectoral caps, investment caps, to circumvent from the huge penalties. In order to avoid damaging circumstances, Aristotle have specially designed this services, to ensure due compliance of Foreign Exchange laws with the in-depth knowledge of international markets and the Foreign Investment Management Act (FEMA), 1999. Aristotle has significant expertise in this area. Our expertise covers all types of cross border transactions – import, export, debt funding, equity capital infusion, transfer of shares etc. our services include all aspects of such transactions – negotiating with banks for exchange rates, banking liaison, notifying authorities, advisory, valuations and other compliances.
- Setting up business in India
The First and the foremost step for the entry in India is to set up a business in India. There are various modes that are available for setting up business in India which includes Incorporation of Wholly-Owned Subsidiary Company, Joint Venture Company, Project Office / Liaison office / Branch office of a Foreign Company in India.
- Foreign Exchange Law compliance management
Foreign Exchange Management Act (FEMA) is the legislation which governs the foreign currency in India. The main aim of FEMA is to facilitate external trade, balance the payments, promote the orderly development, and maintain the foreign exchange market in India. Aristotle provides services to investors for facilitating their investment in India which includes advice provided on the investment strategy, consultation for doing business in India, obtaining permissions to set up office that includes assistance provided for Joint Ventures and handling the other routine compliances. Aristotle is expertise in setting up, reporting, taking government approvals, filing with the authority and all related aspect of support. In India there is a huge penalty on the violation of FEMA and RBI Regulations.
- Assistance in Overseas Direct Investments
Aristotle has a team of Expertise which aids in Overseas Direct Investments which includes reporting and Liaisoning with RBI through Authorised Dealer Bank. Below is the list of documents required for ODI:
- Request letter with complete details of the transaction.
- Debit Authority letter (Format attached)
- Form A2 & FEMA Declaration (Format attached)
- Board Resolution for formation of overseas subsidiary with details of proposed investment & details of authorized signatory.
- Form ODI
- Copy of certificate of incorporation of overseas company.
- Copy of PAN Card.
- Confirmation on name of the Statutory Auditors of the company.
- MOA of the overseas subsidiary.
- Indian Party details
- Audited financial of Indian Party.
- Need a Net worth certificate from Indian remitter – which should be duly signed by Director, Statutory Auditor or Company Secretary
- Refund of Share Application Money
To make investment in a Company the first step is providing of Share Application to Investee Company, which shall be allotted within 60 Days (as per Companies Act, 2013), if the same is not within the stipulated time, the whole amount shall require to be refunded to the Investor. The Aristotle team helps in simplifying this complex task with its expertise and skills in this arena. The Procedure includes filling of necessary documents and Liaisoning with AD Bank.
- Advisory on foreign Policies and procedures in India and Transfer of shares
The Stakeholders are required to comply with the RBI compliances in the following manner for Transfer of shares between residents and non-residents and vice-versa.The Form FCTRS should be submitted to the AD bank, within 60 days from the date of receipt of the amount of Consideration. The Onus of the submission of the Form FCTRS within the given period would be on the transferor/transferee, resident of IndiaThe Transfer of shares are subject to the KYC check by the remittance receiving AD bank at the time of receipt of fundsThe AD bank should scrutinize the transactions and on being satisfied about the transactions should certify the form FC-TRS as being in order
- Filling of Annual Return with RBI
The annual return on Foreign Liabilities and Assets (FLA) is required to be submitted directly by all the Indian companies which have received FDI (Foreign Direct Investment) and/or made FDI abroad (i.e. Overseas Investment) in the previous year(s) including the current year i.e. who holds foreign Assets or Liabilities in their Balance Sheets. If the Indian company does not have any outstanding investment in respect of inward and outward FDI as on end-March of reporting year, the company need not submit the FLA Return. Annual return on Foreign Liabilities and Assets has been notified under FEMA 1999 and it is required to be submitted by all the India resident companies which have received FDI and/ or made overseas investment in any of the previous year(s), including current year by July 15 every year. Non-filing of the return before due date will be treated as a violation of FEMA and penalty clause may be invoked for violation of FEMA
Read more about Annual Filing Compliance .
- One stop solution for all your needs related to legal and Compliances.
- Efficient and effective handling of entire process within defined SLA and TAT
- We work with our clients as partners and take full ownership end to end of deliverables
- We not only advise about what to do but we roll up our sleeves and say let us make it work together
- Extensive exposure to complex FEMA/RBI issues
Learn more about finance and accounting outsourcing services at Aristotle Consultancy.