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Jan 12, 2022 · Downstream Investment under FEMA ,1999 means investment by an Indian entity having FDI into another Indian entity. The first foreign investment is called Foreign Direct Investment and later one is called Foreign Indirect Investment.
Jun 15, 2023 · Downstream investments are governed under the Foreign Exchange Management Act, 1999 (FEMA), and rules and regulations made thereunder, more particularly Rule 23 of the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019 (the “FEMA NDI Rules”), which provides that an Indian entity that has received indirect foreign investment has ...
Aug 8, 2024 · 9.1.13 ‘Downstream Investment’ is investment made by an Indian entity which has received foreign investment or an Investment Vehicle in the equity instruments or the capital, as the case may be, of another Indian entity.
Under the NDI Rules, indirect foreign investment refers to downstream investment received by an Indian entity from another Indian entity that has received foreign investment and (i) the Indian entity is not owned and not controlled by resident Indian citizens or (ii) is owned or controlled by persons resident outside India; or an investment ...
Investment by an intermediate Indian company (which is owned or controlled by foreigners) into another Indian entity is considered as Indirect Foreign Investment (IFI) or downstream investment. IFI rules apply across all levels of downstream investment. IFI rules are amongst the most complicated rules.
Sep 27, 2024 · In cases where such investments are channelled through an entity established in India, they are known as indirect foreign investment or 'downstream investment'. For instance, if a foreign holding company invests in an Indian entity via its Indian subsidiary, this would constitute a 'downstream investment'.
May 25, 2021 · Foreign Investment in to India comprises of both direct foreign investment from non-residents and indirect investments through resident Indian entities having such direct foreign investment. Indirect Foreign Investment is often referred to as “Downstream Investment (DI)” under FEMA.
Downstream investments by FOCCs: Practical challenges and conundrums. The regulatory uncertainty surrounding downstream investments by foreign owned or controlled companies raises more than a few challenges in structuring transactions and leaves certain key aspects open to interpretation.
Oct 6, 2022 · Downstream Investments – A Regulatory Conundrum. INTRODUCTION. Conceptually, a foreign investor has an option to make investment in India either directly or indirectly through an Indian entity (i.e. a company or LLP) owned or controlled by it.
Indirect Foreign Investment is considered as Downstream Investment (DI). Downstream investments can be made through internal accruals. Indian entity can make DI by bringing in requisite funds from abroad. However, entity making DI cannot use funds borrowed in the domestic markets.
