FEMA (Transfer / Issue of Security by PROI) Regulations Amendment – 2015

Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) (Amendment) Regulations, 2015 – 334/2015-RB – Dated 9-1-2015 – Foreign Exchange Management

RESERVE BANK OF INDIA

Foreign Exchange Department

Central Office

Mumbai- 400 001

Notification No.FEMA.334/2015-RB

Dated January 09, 2015

Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) (Amendment) Regulations, 2015

G.S.R. 30(E) – In exercise of the powers conferred by clause (b) of sub-section (3) of Section 6 and Section 47 of the Foreign Exchange Management Act, 1999 (42 of 1999), the Reserve Bank of India hereby makes the following amendments in the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000 (Notification No.FEMA 20/2000-RB dated 3rd May 2000) namely:-

1. Short Title & Commencement:-

(i) These Regulations may be called the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) (Amendment) Regulations, 2015.

(ii) They shall come into force from January 21, 2015.

2. Amendment to Schedule 1

In the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000 (Notification No.FEMA 20/2000-RB dated 3rd May 2000), the existing entry 17 in Annex B of the Schedule 1 shall be substituted by the following, namely:-

17

Pharmaceuticals

17.1                      Greenfield                    100%                 Automatic

17.2                      Brownfield                    100%               Government

17.3 Other Conditions:

17.3.1

I. ‘Non-compete’ clause would not be allowed except in special circumstances with the approval of the Foreign Investment Promotion Board.

II. The prospective investor and the prospective investee are required to provide a certificate along with the FIPB application.

III. Government may incorporate appropriate conditions for FDI in brownfield cases, at the time of granting approval.

Note :

i. FDI upto 100% under the automatic route is permitted for manufacturing of medical devices. The abovementioned conditions, will, therefore, not be applicable to greenfield as well as brownfield projects of this industry.

ii. Medical device means :-

a) Any instrument, apparatus, appliance, implant, material or other article, whether used alone or in combination, including the software intended by its manufacturer to be used specially for human beings or animals for one or more of the specific purposes of :-

(aa) Diagnosis, prevention, monitoring, treatment or alleviation of any disease or disorder;
(ab) diagnosis, monitoring, treatment, alleviation of, or assistance for, any injury or handicap;
(ac) investigation, replacement or modification or support of the anatomy or of a physiological process;
(ad) supporting or sustaining life;
(ae) disinfection of medical devices;
(af) control of conception;
and which does not achieve its primary intended action in or on the human body or animals by any pharmacological or immunological or metabolic means, but which may be assisted in its intended function by such means;

b) an accessory to such an instrument, apparatus, appliance, material or other article;

c) a device which is reagent, reagent product, calibrator, control material, kit, instrument, apparatus, equipment or system whether used alone or in combination thereof intended to be used for examination and providing information for medical or diagnostic purposes by means of in vitro examination of specimens derived from the human body or animals.

iii. The definition of medical device at Note (ii) above would be subject to the amendment in Drugs and Cosmetics Act.

(B.P. Kanungo)

Principal Chief General Manager

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