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SAMPLE SECTORAL APPROVAL FOR FOREIGN INVESTMENT
 
(from the Ministry of Information and Broadcasting)
 

[Note: This is a sample sectoral approval received from the Ministry of Information and Broadcasting for foreign investment into an Indian newspaper. This is for reference purposes only - the actual terms of the approval may vary depending on latest changes under the FDI Policy and sectoral regulations.] 


No. [●]
GOVERNMENT OF INDIA
MINISTRY OF INFORMATION AND BROADCASTING
A’ Wing, Shastri Bhawan, New Delhi – 110001.
 

New Delhi, dated [●]

[Name and address of the company]

Subject: Proposal for foreign investment by [Name and address of the investee company].

              I am directed to refer to your application dated [date] on the above cited subject and to say that this Ministry has conveyed its No-Objection to Foreign Investment Promotion Board, M/o Finance, Department of Economic Affairs vide letter of dated [●]. A copy of the No-Objection letter is enclosed herewith.
Yours faithfully,
 
 
SECTION OFFICER
Ministry of Information and Broadcasting
Tele # No#
Encl. As above
 
No. [●]
GOVERNMENT OF INDIA
MINISTRY OF INFORMATION AND BROADCASTING
A’ Wing, Shastri Bhawan, New Delhi – 110001.
 
New Delhi, dated [●]
 

OFFICE MEMORANDUM

 
Subject: Proposal for foreign investment by [Name and address of the domestic company].
           
            The undersigned is directed to refer to the proposal dated [date] received from [Name and address of the domestic company]., for foreign investment upto [investment amount in percentage]% by [Name and address of the foreign company], in the paid up capital of [Name and address of the domestic company] and to say that this Ministry has “No-Objection” to the above cited proposal subject to the following conditions: -
  1. That the proposed FDI in [Name and address of the domestic company] or the new entity formed, if any, after such Foreign Direct Investment should not exceed the limit of 18%. Matters regarding raising of limit beyond 18% and upto the upper limit of 26% will be regulated as per the clauses 5(v) and 5(vi) of the guidelines dated 31.03.2006 issued by this Ministry on the subject. While calculating the percentage of FDI in the equity of the [Name and address of the domestic company] or the new entity formed, if any, after such FDI, the foreign holding component, if any, in the equity of the Indian shareholder companies of the [Name and address of the domestic company] will be duly reckoned on pro rata basis so as to arrive at the total foreign holding in [Name and address of the domestic company].
  2. That the shareholding of the largest Indian shareholder, as defined in the said Guidelines, should always be at least 51% of the total paid up equity. In a case of combination of more than one entity constituting the largest Indian shareholder, each of the entities shall always remain entered into a legally binding agreement to act as a single unit in managing the matters of [Name and address of the domestic company] or the new entity formed, after such Foreign Direct Investment.
  3. At least 3/4th of the Directors on the Board of Directors of [Name and address of the domestic company] or the new entity formed, if any, after such Foreign Direct Investment and all key executive and editorial staff must be resident Indians.
  4. It will be obligatory on the part of [Name and address of the domestic company] or the new entity formed, if any, after such Foreign Direct Investment to inform the M/o Information &Broadcasting about any alteration in the foreign shareholding pattern as on 31st March of every year and within 15 days of the end of Financial Year.
  5. It will be obligatory on the part of [Name and address of the domestic company] or the new entity formed, if any, after such Foreign Direct Investment to take prior permission from the Ministry of Information and Broadcasting before effecting any changes in the shareholding of the largest Indian shareholder.
  6. [Name and address of the domestic company] or the new entity formed, if any, after such Foreign Direct Investment shall inform Ministry of Information and Broadcasting within 15 days of effecting any change in the composition of the Board of Directors or Key executives and editorial staff. Such changes would be subject to post-facto approval of Ministry of Information and Broadcasting.
  7. [Name and address of the domestic company] or the new entity formed, if any, after such Foreign Direct Investment shall be liable to intimate the names and details of any foreigners/NRIs proposed to be employed/engaged either as Consultant or in any other capacity for more than 60 days in a year, or as regular employees. It shall be liable to dispense with the services of such persons if not found security cleared subsequently.
  8. Any change in the Shareholders’ Agreement and Loan Agreements shall be disclosed to the Ministry of Information & Broadcasting within 15 days of such changes.
  9. The Article/Memorandum of Association of [Name and address of the domestic company] or the new entity formed, if any, after such Foreign Direct Investment must ensure compliance with the prescribed eligibility criteria.
  10. [Name and address of the domestic company] or the new entity formed, if any, after such Foreign Direct Investment shall obtain prior clearance from the Ministry of Information & Broadcasting of all persons not being resident Indians who are proposed to be inducted in the Board of Directors.
  11. That [Name and address of the domestic company] or the new entity formed, if any, after such Foreign Direct Investment shall intimate current Foreign Direct Investment (FDI), if any, in the Company to Reserve Bank of India (RBI) so as to enable RBI to monitor FII purchase to ensure that FDI+FII does not exceed the cap of 26%.
  12. Changes in Foreign Direct Investment (FDI), if any, approved by the Government shall be periodically be advised to Reserve Bank of India to enable RBI to monitor the composite cap.
  13. That [Name and address of the domestic company] or the new entity formed, if any, after such Foreign Direct Investment shall strictly adhere to the provisions contained in the Companies Act, 1956.
  14. That clearance as required under the Press and Registration of Books Act, 1867 shall be obtained from the Registrar of Newspapers for India.
  15. That the conditions prescribed in the guidelines of the Ministry of Information & Broadcasting on the subject shall be followed in letter and spirit and any departure from the conditions stipulated in the guidelines would result in revocation of this “No-Objection”.
It is requested that the conditions may be incorporated in the approval letter to be issued to the applicant and a copy endorsed to this Ministry.
 
Director (IP)
Tele #
[●] [Insert name and designation of officer]
Ministry of Information and Broadcasting,

 
Copy to: -
  1. M/o External Affairs (Director [XP]), Shastri Bhavan, New Delhi.
  2. M/o Commerce & Industry, Development of IP&P, (Under Secretary {FCI}), Udyog Bhavan, New Delhi.
  3. M/o Company Affairs (Joint Director), Shastri Bhavan, New Delhi.
  4. M/o Home Affairs, (Deputy Secretary [IS-II]), North Block, New Delhi.
  5. M/o Finance, Department of Economic Affairs (Under Secretary [FIU]), North Block, New Delhi.
  6. Reserve Bank of India, Exchange Control Department, Mumbai.
  7. Director, RR&TD, Soochna Bhavan, New Delhi.
  8. RNI (Press Registrar), R.K. New Delhi.




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