These Regulations may be called the Foreign Exchange Management (Mode of Payment and Reporting of Non-Debt Instruments) (Third Amendment) Regulations, 2025.In the principal regulations, in regulation 3.1, for the existing provision at Sl. No. I, II, VI, VII, VIII and IX the following shall be substituted, namely:
1. Schedule I – Investment by a Person Resident Outside India in Equity Instruments
Mode of Payment:
- Consideration must be received as an inward remittance through banking channels or from a repatriable foreign currency or Rupee account under FEMA (Deposit) Regulations, 2016.
- Consideration includes:
- Issue of equity shares against any funds payable by the Indian company.
- Swap of equity instruments.
Remittance of Sale Proceeds:
- Proceeds (net of taxes) can be remitted abroad or credited to the investor’s repatriable foreign currency or Rupee account.
2. Schedule II – Investment by Foreign Portfolio Investors (FPIs)
Mode of Payment:
- Investment to be made through an inward remittance or from a foreign currency account or Special Non-Resident Rupee (SNRR) account under FEMA (Deposit) Regulations, 2016.
Remittance of Sale Proceeds:
- Sale proceeds (net of taxes) can be remitted abroad or credited to the FPI’s foreign currency or SNRR account.
3. Schedule VI – Investment in a Limited Liability Partnership (LLP)
Mode of Payment:
- Capital contribution must be made through an inward remittance or from a repatriable foreign currency or Rupee account.
Remittance of Disinvestment Proceeds:
- Proceeds from disinvestment can be remitted abroad or credited to the investor’s repatriable foreign currency or Rupee account.
4. Schedule VII – Investment by a Foreign Venture Capital Investor (FVCI)
Mode of Payment:
- Investment to be made via inward remittance, foreign currency account, or SNRR account.
- The foreign currency account can only be used for transactions under this schedule.
Remittance of Sale/Maturity Proceeds:
- Sale/maturity proceeds (net of taxes) can be remitted abroad or credited to the investor’s foreign currency or SNRR account.
5. Schedule VIII – Investment by a Person Resident Outside India in an Investment Vehicle
Mode of Payment:
- Investment can be made via inward remittance, swap of shares of a Special Purpose Vehicle (SPV), or repatriable foreign currency/Rupee account.
Remittance of Sale/Maturity Proceeds:
- Proceeds (net of taxes) can be remitted abroad or credited to the investor’s repatriable foreign currency or Rupee account.
6. Schedule X – Investment in Indian Depository Receipts (IDRs)
Mode of Payment:
- NRIs/OCIs: Can invest through their NRE/FCNR(B) account.
- FPIs: Can invest through their foreign currency or SNRR account.
Remittance of Sale/Maturity Proceeds:
- Redemption/conversion of IDRs into underlying equity shares must comply with FEMA (Overseas Investment) Rules, 2022.
Link – https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12768&Mode=0
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