Redemption of Foreign Currency Convertible Bonds (FCCBs) - આરબીઆઈ - Reserve Bank of India
Redemption of Foreign Currency Convertible Bonds (FCCBs)
RBI/2011-12/105 July 04, 2011 To All Category - I Authorised Dealer Banks Madam / Sir, Redemption of Foreign Currency Convertible Bonds (FCCBs) Attention of the Authorised Dealer Category - I (AD Category - I) banks is invited to A. P. (DIR Series) Circular No.5 dated August 1, 2005, as amended from time to time, relating to instructions / guidelines in respect of External Commercial Borrowings (ECBs), which are also applicable, mutatis mutandis, to FCCBs. 2. Keeping in view the need to provide a window to facilitate refinancing of FCCBs by the Indian companies who may be facing difficulty in meeting the redemption obligations, it has been decided to consider applications for refinancing of FCCBs by Indian companies under the automatic route. Accordingly, designated AD Category - I banks may allow Indian companies to refinance the outstanding FCCBs subject to compliance with the terms and conditions set out hereunder: -
3. Restructuring of FCCBs involving change in the existing conversion price is not permissible. Proposals for restructuring of FCCBs not involving change in conversion price will, however, be considered under the approval route depending on the merits of the proposal. 4. The policy will be subject to review at an appropriate time depending upon evolving macroeconomic conditions and other relevant factors. 5. This facility shall come into force with immediate effect. 6. AD Category - I banks may bring the contents of this circular to the notice of their constituents and customers concerned. 7. The directions contained in this circular have been issued under sections 10 (4) and 11 (1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law. Yours faithfully, (Rashmi Fauzdar)
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