The Reserve Bank of India (RBI) on 7 November issued the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2017 (TISPRO Regulations). The new TISPRO regulations supersede the TISPRO regulations, 2000, which were in place for the last 17 years.
The new TISPRO regulations streamline the foreign direct investment regime in India and bring it in line with the Consolidated Foreign Direct Investment Policy of 2017. The following are the highlights:
Capital instruments. The definition of the term “capital instruments” covers equity shares, fully, compulsorily and mandatorily convertible debentures, preference shares and share warrants. It has been clarified under the new TISPRO regulations that partly paid shares or share warrants may be issued upon 25% upfront payment of the consideration and the balance is to be paid within 12-18 months from the date of such issue.
The business law digest is compiled by Nishith Desai Associates (NDA). NDA is a research-based international law firm with offices in Mumbai, New Delhi, Bengaluru, Singapore, Silicon Valley and Munich. It specializes in strategic legal, regulatory and tax advice coupled with industry expertise in an integrated manner.
