Proven track record a must for ODIs by proprietorship firms, says RBI
Updated: Jan 23, 2015 12:00:48pm
Mumbai, Jan 23 (KNN) Reserve Bank of India (RBI) which has reviewed the policy framework for Overseas Direct Investments (ODI) by proprietorship concerns and unregistered partnership firms in India has said that it is mandatory for firms to have a proven track record for ODIs.
The apex bank has specified revised terms and conditions that are required to be complied with for considering the proposal of ODI, according to a notification issued on Thursday.
“The proprietorship concern / unregistered partnership firm in India has a proven track record, i.e., the export outstanding does not exceed 10 per cent of the average export realisation of the preceding three years and a consistently high export performance,” it said.
The review has been made keeping in view the changes in the definition / classification of the exporters as per the Foreign Trade Policy of the Ministry of Commerce and Industry.
Further, “The proprietorship concern / unregistered partnership firm in India is classified as ‘Status Holder’ as per the Foreign Trade Policy issued by the Ministry of Commerce and Industry, Govt. of India from time to time,” it said.
The country’s central bank also said that banks should be satisfied that the proprietorship concern / unregistered partnership firm in India is KYC (Know Your Customer) compliant, engaged in the proposed business and has the required turnover.
Also, the proprietorship concern / unregistered partnership firm in India should not have come under the adverse notice of any Government agency like the Directorate of Enforcement, Central Bureau of Investigation, Income Tax Department, etc. and does not appear in the exporters' caution list of the Reserve Bank or in the list of defaulters to the banking system in India.
In addition, the amount of proposed investment outside India should not exceed 10 per cent of the average of last three years’ export realisation or 200 per cent of the net owned funds of the proprietorship concern / unregistered partnership firm in India, whichever is lower. (KNN/ES)
The apex bank has specified revised terms and conditions that are required to be complied with for considering the proposal of ODI, according to a notification issued on Thursday.
“The proprietorship concern / unregistered partnership firm in India has a proven track record, i.e., the export outstanding does not exceed 10 per cent of the average export realisation of the preceding three years and a consistently high export performance,” it said.
The review has been made keeping in view the changes in the definition / classification of the exporters as per the Foreign Trade Policy of the Ministry of Commerce and Industry.
Further, “The proprietorship concern / unregistered partnership firm in India is classified as ‘Status Holder’ as per the Foreign Trade Policy issued by the Ministry of Commerce and Industry, Govt. of India from time to time,” it said.
The country’s central bank also said that banks should be satisfied that the proprietorship concern / unregistered partnership firm in India is KYC (Know Your Customer) compliant, engaged in the proposed business and has the required turnover.
Also, the proprietorship concern / unregistered partnership firm in India should not have come under the adverse notice of any Government agency like the Directorate of Enforcement, Central Bureau of Investigation, Income Tax Department, etc. and does not appear in the exporters' caution list of the Reserve Bank or in the list of defaulters to the banking system in India.
In addition, the amount of proposed investment outside India should not exceed 10 per cent of the average of last three years’ export realisation or 200 per cent of the net owned funds of the proprietorship concern / unregistered partnership firm in India, whichever is lower. (KNN/ES)
Loading...
