10C.4
- Document type
- Manual
- Dated
- Category
- Exchange Management Manual
General permission to subscribe to the Memorandum and Articles of Association
In order to facilitate NRIs to set up new companies in India, Reserve Bank vide its Notification No.FERA.143/93-RB dated 26th April 1993, has granted general permission under Section 29(1)(b) read with Section 19(1)(d) of the Foreign Exchange Regulation Act, 1973 to NRIs to subscribe to the Memorandum and Articles of Association and to take up the shares of Indian companies for their incorporation. The general permission empowers such Indian companies to issue shares to NRIs provided the total face value of the shares to be issued does not exceed Rs.10,000/- and the company is not engaged in any activity relating to agricultural and plantation. The Indian company is required to file a declaration of the issue to Reserve Bank in form DSS within period of 90 days from the date of its incorporation. The repatriability or otherwise of this investment will be decided by Reserve Bank while granting permission under Section 19(1)(d) of the Act for issue of further shares to NRIs.