TMI BlogForeign Exchange Management (Cross Border Merger) Regulations, 2018X X X X Extracts X X X X X X X X Extracts X X X X ..... itle and commencement These Regulations may be called the Foreign Exchange Management (Cross Border Merger) Regulations, 2018. They shall come into force from the date of their publication in the Official Gazette. 2. Definitions In these Regulations unless the context requires otherwise, - i. Act means the Foreign Exchange Management Act, 1999 (42 of 1999); ii. Companies Act means The Companies Act, 2013 ; iii. Cross border merger means any merger, amalgamation or arrangement between an Indian company and foreign company in accordance with Companies (Compromises, Arrangements and Amalgamation) Rules, 2016 notified under the Companies Act, 2013; iv. Foreign company means any company or body corp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... competent authority as on date of commencement of these regulations shall be governed by these Regulations. 4. Inbound merger In an inbound merger, (1) the resultant company may issue or transfer any security and/or a foreign security, as the case may be, to a person resident outside India in accordance with the pricing guidelines, entry routes, sectoral caps, attendant conditions and reporting requirements for foreign investment as laid down in Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2017 . Provided that i. where the foreign company is a joint venture (JV)/ wholly owned subsidiary (WOS) of the Indian company, it shall comply with the conditions prescribe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egulations, 2000 or Foreign Exchange Management (Guarantee) Regulations, 2000 , as applicable. Provided that no remittance for repayment of such liability is made from India within such period of two years; Provided further that the conditions with respect to end use shall not apply. (4) The resultant company may acquire and hold any asset outside India which an Indian company is permitted to acquire under the provisions of the Act, rules or regulations framed thereunder. Such assets can be transferred in any manner for undertaking a transaction permissible under the Act or rules or regulations framed thereunder. (5) Where the asset or security outside India is not permitted to be acquired or held by the resultant company unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h office or a liaison office or a project office or any other place of business) Regulations, 2016 . Accordingly, the resultant company may undertake any transaction as permitted to a branch office under the aforesaid Regulations. (4) The guarantees or outstanding borrowings of the Indian company which become the liabilities of the resultant company shall be repaid as per the Scheme sanctioned by the NCLT in terms of the Companies (Compromises, Arrangement or Amalgamation) Rules, 2016 . Provided that the resultant company shall not acquire any liability payable towards a lender in India in Rupees which is not in conformity with the Act or rules or regulations framed thereunder. Provided further that a no-objection certificate to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n by the resultant company, to a holder of a security of the Indian company or the foreign company, as the case may be, may be paid, in accordance with the Scheme sanctioned by the NCLT. (2) The companies involved in the cross border merger shall ensure that regulatory actions, if any, prior to merger, with respect to non-compliance, contravention, violation, as the case may be, of the Act or the Rules or the Regulations framed thereunder shall be completed. 8. Reporting (1) The resultant company and/or the companies involved in the cross border merger shall be required to furnish reports as may be prescribed by the Reserve Bank, in consultation with the Government of India, from time to time. 9. Deemed approval (1) Any t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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