Fc Gpr Fdi Reporting

Form FC-GPR is a crucial document that companies in India must file with the Reserve Bank of India (RBI) when they receive foreign direct investment (FDI). This form is not just a regulatory requirement; it ensures transparency in the reporting of foreign investments and helps maintain the integrity of India’s foreign exchange market. In this article, we will delve into the specifics of Form FC-GPR, including its purpose, filing requirements, and the process involved in submitting it. We will also address some frequently asked questions to provide a well-rounded understanding of this important regulatory tool.

What is Form FC-GPR?

The Foreign Currency-Gross Provisional Return (FC-GPR) is a form required by the RBI to report the issuance of shares to foreign investors. When an Indian company receives foreign investment, it must issue shares to the investor based on that investment. Filing Form FC-GPR is mandatory to document this allotment of shares and to ensure compliance with the Foreign Exchange Management Act (FEMA) of 1999.

Purpose of Form FC-GPR

The primary purposes of Form FC-GPR are:

  1. Regulatory Compliance: It ensures that the issuance of shares to foreign investors complies with Indian laws.
  2. Data Collection: It helps the RBI collect important data about foreign investments, which is critical for monitoring and formulating policies related to FDI.
  3. Transparency: It promotes transparency in financial transactions involving foreign investments, helping to maintain investor confidence.

Conditions for Filing Form FC-GPR

Companies must adhere to specific conditions when filing Form FC-GPR:

  • Compliance with FDI Policy: The foreign investment must align with the current Foreign Direct Investment policy in India.
  • Adherence to FEMA: The issuance of securities should be compliant with the Foreign Exchange Management Act (FEMA).

Eligible Securities

Only specific types of securities can be reported under Form FC-GPR:

  • Equity Shares
  • Convertible Preference Shares
  • Convertible Debentures

Due Date for Filing Form FC-GPR

The deadline for submitting Form FC-GPR is 30 days from the date of the share issuance. Timely filing is crucial to avoid penalties and to ensure compliance with regulatory requirements.

Pre-filing Requirements

Before filing Form FC-GPR, companies need to gather the following documents:

  • Unique Identification Number (UIN) from RBI for reporting foreign remittance.
  • KYC Report of the beneficiary, especially if the remitter and beneficiary are different entities.
  • Company Secretary Certificate confirming compliance.
  • Valuation Certificate from a SEBI-registered Chartered Accountant or Merchant Banker detailing the share pricing.
  • Disclaimer Certificate and Statutory Auditor Certificate.
  • Board Resolution approving the share issuance.
  • Loan Registration Number (LRN).
  • Foreign Investment Promotion Board (FIPB) approval, if applicable.
  • Transfer Details of shares, if necessary.
  • No Objection Certificate (NOC) from the remitter.
  • Letter from the Foreign Investor explaining the reasons for the investment.
  • Agreement or Board Resolution regarding share allotment to foreign investors.

Documents Required for Filing Form FC-GPR

To ensure a smooth filing process, companies should prepare the following documents:

  1. Declaration: As per the RBI user manual format.
  2. Company Secretary Certificate: To confirm compliance with the necessary regulations.
  3. Valuation Certificate: Must comply with FEMA 20(R), though not required for rights issues.
  4. Acknowledgement Letters: For previous filings related to the original investment.
  5. Board Resolution: Documenting the decision to issue shares.
  6. Memorandum of Association: Including relevant extracts.
  7. Merger/Demerger Approvals: Any necessary regulatory approvals.
  8. FIRC and KYC: For foreign inward remittance and KYC compliance.

Filing Process for Form FC-GPR

Step 1: User Registration

To file Form FC-GPR, the applicant must first register on the FIRMS portal (Foreign Investment Reporting and Management System):

  1. Visit the official FIRMS website.
  2. Click on "Registration for New Business User."
  3. Fill in the required details and submit the registration form.

The authorized dealer bank will verify the application and notify the applicant via email.

Step 2: Logging into FIRMS

After receiving login credentials, the applicant should:

  1. Log in to the FIRMS portal using the provided username and password.
  2. Access the workspace to initiate the filing process.

Step 3: Accessing the Single Master Form (SMF)

After logging in, navigate to the Single Master Form (SMF):

  1. Click on the navigation button.
  2. Select SMF to access your workspace.

Step 4: Selecting Return Type

Choose Form FC-GPR from the list of available forms. The system will auto-fill details such as CIN, PAN, and company name, while other details need to be filled manually.

Step 5: Investment Details

Provide information regarding the investment, including the shareholding pattern and the date of share issuance.

Step 6: Issue Details

Enter details about the nature of the issue, date of issuance, and initial FC-GPR reference number, if applicable.

Step 7: Foreign Investment Details

Detail the foreign investors’ information, including the number of investors, addresses, and the nature of the investing entity.

Step 8: Amount of Issue

Fill in the total inflow amount and the total amount for which the capital instruments have been issued.

Step 9: Particulars of Issue

Provide the fair value of the issued shares as per the certified valuation. Attach the valuation certificate.

Step 10: Shareholding Pattern

The platform will display the values of equity shares and indirect foreign investments. Ensure that pre-transaction and post-transaction values are accurate.

Step 11: Submission of Form

Once all fields are completed, click the "Save and Submit" button to finalize the filing.

Penalties for Non-compliance

Failing to file Form FC-GPR within the stipulated timeline can lead to significant penalties:

  • Late Submission Fee: ?7,500 if filed after the due date but before enforcement action.
  • Monetary Penalty: Up to 300% of the involved amount or a minimum of ?2 lakh for non-filing or false information.
  • Daily Penalty: ?5,000 for continued non-compliance beyond the initial detection.

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Frequently Asked Questions

Form FC-GPR is a report submitted to the RBI when an Indian company issues shares to foreign investors.

Any Indian company receiving foreign direct investment (FDI) must file this form.

Form FC-GPR must be filed within 30 days from the date of issuance of shares.

Essential documents include a declaration, Company Secretary certificate, valuation certificate, and board resolution, among others.

Late filing can incur fees and penalties, including a ₹7,500 late submission fee.

A valuation certificate is not required for rights issues; a simple declaration can suffice.

Yes, Form FC-GPR is submitted through the FIRMS portal.

Providing false information can lead to severe penalties, including monetary fines up to 300% of the amount involved.

Yes, once submitted, you can track the status of your filing through the FIRMS portal.

If there's a delay, document the reason and include it in your filing to the RBI.

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