Prohibition on Indian Party from making direct investment in countries identified as "Non Co- operative countries and territories"- (Reserve Bank of India) (25 Jan 2017)
MANU/APDR/0005/2017
Banking
Attention of the Authorised Dealer Category - I (AD - Category I) banks is invited to Regulation 6 of FEMA Notification No. FEMA.120/RB-2004 dated July 07, 2004, as amended from time to time. At present, there is no restriction on an Indian Party with regard to the countries, where it can undertake Overseas Direct Investment. In order to align, the instructions with the objectives of FATF, on a review, it has been decided to prohibit an Indian Party from making direct investment in an overseas entity (set up or acquired abroad directly as JV/ WOS or indirectly as step down subsidiary) located in the countries identified by the FATF as "non co-operative countries and territories" as per list available on FATF website www.fatf-gafi.org or as notified by the Reserve Bank of India from time to time. Necessary amendments to the Notification ibid have been notified vide Notification No. FEMA 382/2016-RB dated January 02, 2017 c.f. G.S.R. No. 01(E) dated January 02, 2017. AD- Category I banks may bring the contents of this circular to the notice of their constituents and customers concerned. Master Direction No.15/2015-16 dated January 01, 2016 is being updated to reflect the changes. The directions contained in this circular have been issued under section 10(4) and 11(1) of the Foreign Exchange Management Act (FEMA), 1999 (42 of 1999) and are without prejudice to permissions/approvals, if any, required under any other law.
Tags : PROHIBITION DIRECT INVESTMENT NON CO- OPERATIVE COUNTRIES
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