INDIAN STARTUPS HAVING OVERSEAS SUBSIDIARIES MAY OPEN FOREIGN CURRENCY ACCOUNT WITH OVERSEAS BANKS

INDIAN STARTUPS HAVING OVERSEAS SUBSIDIARIES MAY OPEN FOREIGN CURRENCY ACCOUNT  WITH OVERSEAS BANKS

An Indian startup or any other entity as may be notified by the Reserve Bank in consultation with the Central Government, having an overseas subsidiary, may open a foreign currency account with a bank outside India for the purpose of crediting to it foreign exchange earnings out of exports/ sales made by the said entity and/ or the receivables, arising out of exports/ sales, of its overseas subsidiary.

Provided that the balances in the account shall be repatriated to India within the period prescribed in Foreign Exchange Management (Export of Goods and Services) Regulations, 2015 dated January 12, 2016, as amended from time to time, for realization of export proceeds.

Explanation: For the purpose of this sub-regulation a ‘startup’ means an entity which complies with the conditions laid down in Notification No. G.S.R 180(E) dated February 17, 2016 issued by Department of Industrial Policy and Promotion, Ministry of Commerce and Industry, Government of India.”

(SOURCES: Notification No. FEMA 10(R)/(1)/2016-RB Mumbai, the 1st June, 2016)