Foreign Exchange Management (Overseas Investment) Directions, 2022

Question 1

The extant (current) concept of JV and WOS has been substituted under the new regime with the concept of ………………………

Answer 1

Foreign Entity

Question 2

……………… means an entity formed or registered or incorporated outside India, including in International Financial Services Centre (IFSC) in India, that has limited liability

Answer 2

Foreign Entity

Question 3

…………………means investment, other than ODI, in foreign securities

Answer 3

Overseas Portfolio Investment (OPI)

Question 4

Once qualified as a ODI will continue to be treated as ……….. even if the required conditions are not met later

Answer 4

ODI

Question 5

OPI shall not be made in

Answer 5

any unlisted debt instruments, any derivatives unless otherwise permitted by Reserve Bank, any commodities including Bullion Depository Receipts (BDRs) and any security which is issued by a person resident in India who is not in an IFSC

Question 6

What is the limit for resident Individuals to make OPI

Answer 6

within the overall limit for Liberalised Remittance Scheme (LRS)

Question 7

Resident individuals are not permitted to transfer any overseas investment by way of ………. to a person resident outside India

Answer 7

Gift

Question 8

Financial commitment by an Indian entity, exceeding ……………(or its equivalent) in a financial year shall require prior approval of the Reserve Bank even when the total financial commitment of the Indian entity is within the eligible limit under the automatic route

Answer 8

USD 1 Billion

Question 9

Overseas investment limit for MF

Answer 9

USD 7 Billion

Question 10

Overseas investment limit for VCFs/AIFs

Answer 10

USD 1.5 Billion

Question 11

Qualified MFs are permitted to invest cumulatively up to ……………………… in overseas Exchange Traded Funds, as may be permitted by SEBI.

Answer 11

USD 1 Billion (Such investment shall be considered as OPI irrespective of whether the securities are listed or not.)

Question 12

Investment by Qualified MFs in Exchange Traded Fund is treated as ………. Irrespective of whether the securities are listed or not

Answer 12

OPI

Question 13

The person intending to make any financial commitment as ODI shall fill up the …………….., also submit the evidence of investment within …… months. If not able to submit the evidence than they should bring back the amount to India.

Answer 13

Form FC, 6 months

Question 14

Any ODI in startups shall not be made from funds ……………………

Answer 14

borrowed from others

Question 15

Overseas investment by way of …………….. is not permitted

Answer 15

cash

Question 16

An Indian entity may open, hold and maintain ………………………….. abroad for the purpose of making ODI.

Answer 16

Foreign Currency Account (FCA)

Question 17

Late Submission Fee (LSF) for 1. Form ODI Part-II/ APR, FLA Returns, Form OPI, evidence of investment or any other return which does not capture flows or any other periodical reporting is

Answer 17

₹ 7500

Question 18

Late Submission Fee (LSF) for 2. Form ODI-Part I, Form ODI-Part III, Form FC, or any other return which captures flows or returns which capture reporting of non-fund based transactions or any other transactional reporting is

Answer 18

₹ 7500 + 0.025% of the amount involved for number of years and months.

Question 19

Resident individual shall not make financial commitment by way

Answer 19

Debt

Question 20

An AD bank may allow an Indian entity having an overseas office to acquire immovable property outside India for the business and residential purposes of its staff provided the limit for remittance of expenses will be as below
i. Initial Expense
ii. recurring expense

Answer 20

i. 15% of average annual sales/income/turnover for 2 financial year or 25% of Networth of the Indian Entity, whichever is higher
ii. 10% of average annual sales/income/turnover for 2 financial year of the Indian Entity