fdi-compliance

name	fdi-compliance
description	FDI inflow compliance under FEMA — FC-GPR (equity allotment to foreigners), FC-TRS (transfer of shares), and FIFP (downstream investment). Covers RBI reporting, pricing norms (FEMA 20R), sectoral caps, approval route vs automatic route, and deferred consideration requirements.
when_to_use	When a company receives FDI (foreign equity investment), allots shares to a foreign investor, or when shares are transferred between a resident and non-resident.
effort	high
model	claude-opus-4-7
allowed-tools	["mcp__memory_bank__get_client","mcp__memory_bank__get_firm_profile","Read","Write"]

FDI Compliance — FC-GPR / FC-TRS

FINANCIAL INTEGRITY: FEMA violations attract compounding penalties. Late filing of FC-GPR/FC-TRS is compoundable but time-sensitive. Any FDI in restricted sectors requires prior government approval. All pricing of shares must comply with FEMA 20R valuation norms — do not conclude without CA/SEBI-registered valuer certificate.

FDI Routes

Route	Applicable Sectors	Approval Required
Automatic Route	Most sectors — up to sectoral cap	No prior RBI/Government approval
Government Route	Defense, media, telecom (some), retail, financial services etc.	Prior FIPB/DPIIT/Sectoral Ministry approval

Always check the current FDI Policy (DPIIT website) for latest sectoral caps before advising.

FC-GPR — Fresh Issue of Shares to Foreigner

Trigger: Indian company allots equity/preference shares/convertible debentures to a non-resident.

Timeline: Report to RBI via FC-GPR within 30 days of allotment of shares.

How to file: Through FIRMS portal (Foreign Investment Reporting and Management System) on RBI's website.

Information required:

• Company CIN + PAN + Industry
• Foreign investor name, country, investment route (FDI/NRI/etc.)
• Number of shares allotted + face value + premium + total consideration received
• Date of inflow + Bank reference number (FIRC / e-FIRC from the bank)
• Valuation certificate (as per FEMA 20R): For unlisted companies — DCF method by SEBI-registered valuer or CA (based on internationally accepted pricing methodology)
• KYC of foreign investor

Pricing Norms (FEMA 20R):

• Unlisted companies: Not less than FMV (DCF or NAV — as per internationally accepted pricing methodology)
• Listed companies: Not less than SEBI ICDR pricing norms (market price based formula)

FC-GPR CHECKLIST:
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
[ ] Investment in permitted sector (check FDI policy)
[ ] Within sectoral cap
[ ] Inward remittance received via banking channel (FIRC obtained)
[ ] Valuation certificate by registered valuer (for unlisted)
[ ] Board resolution for allotment passed
[ ] Form PAS-3 filed with MCA
[ ] FC-GPR filed within 30 days of allotment
[ ] Share certificate issued to foreign investor
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━

FC-TRS — Transfer of Shares Between Resident and Non-Resident

Trigger: Transfer of equity shares from a resident to a non-resident (or vice versa).

Timeline: Report within 60 days of receipt/remittance of consideration.

Pricing Norms for Transfer (FEMA 20R):

• Resident to Non-Resident: Transfer at not LESS than FMV (floor price)
• Non-Resident to Resident: Transfer at not MORE than FMV (ceiling price)
• Listed companies: SEBI norms apply

FC-TRS CHECKLIST:
[ ] Valuation certificate obtained (for unlisted — DCF/NAV)
[ ] Consideration received/paid within 60 days of transfer
[ ] FC-TRS reported on FIRMS portal within 60 days
[ ] Share transfer deed executed + stamp duty paid
[ ] Form SH-4 / private agreement as applicable
[ ] New holder registered in company's share register

Annual Return (FLA)

All companies with FDI or ODI must file:

• FLA (Foreign Liabilities and Assets) return — due by 15 July each year
• Filed with RBI: flair.rbi.org.in
• Covers all FDI received, ODI made, and outstanding FLA position as at 31 March