Tuesday, April 23, 2013

Conversion of ECB/Lump sum Fee/Royalty etc. into Equity


Conversion of ECB/Lump sum Fee/Royalty etc. into Equity- Waiver of Condition for valuation from an Independent valuer from country of import


As per the FDI Policy, the companies are allowed to issue equity shares against the import of capital goods/ machinery/ equipment (excluding second-hand machinery), subject to compliance with the various conditions specified therein.

One of the conditions in the FDI policy was mandatory requirement of independent valuation of the capital goods/machinery/equipments (including second-hand machinery) by a third party entity, preferably by an independent valuer from the country of import along with production of copies of documents/certificates issued by the customs authorities towards assessment of the fair-value of such imports.

The said condition has been dispensed with through introduction of the new Consolidated FDI Policy dated 5th April, 2013.


Ref - Consolidated FDI Policy - April 2013

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