Opening of Escrow / Special Accounts by Non-Resident Corporates for open offers / delisting / exit offers - आरबीआय - Reserve Bank of India
Opening of Escrow / Special Accounts by Non-Resident Corporates for open offers / delisting / exit offers
RBI/2006-2007/413 May 24, 2007 To, Opening of Escrow / Special Accounts by Non-Resident Corporates Attention of Authorised Dealer Category – I (AD Category – I) banks is invited to Regulation 10 A (b) of Notification No. FEMA 20/2000-RB dated 3rd May, 2000 [Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000] read with Regulation 3 of Notification No. FEMA 5/2000-RB dated 3rd May 2000, as amended from time to time. In terms of these Regulations, opening of Escrow account and Special account for transfer of shares / convertible debentures of an Indian company through open offer / delisting / exit offer in accordance with the provisions of SEBI [Substantial Acquisition of Shares and Takeovers (SAST)] Regulations, 1997 or any other applicable SEBI Regulations requires prior approval of the Reserve Bank.
Annex Terms and conditions for opening of Escrow Account and Special Account by 2. The accounts shall be non-interest bearing. 3. Escrow Account may be opened in Indian Rupees, jointly and severally for the purpose, with the following permitted credits and debits: Permitted credits : Foreign Inward Remittance through normal banking channels. Permitted debits : as per SEBI (SAST) Regulations or any other SEBI Regulations, as applicable. 4. Special Account may be opened in Rupees, jointly and severally for the purpose, with the credit and debits as per SEBI (SAST) Regulations or any other SEBI Regulations, as applicable. 5. The resident mandatee empowered by the overseas acquirer for this purpose, may operate the Escrow Account in accordance with SEBI Regulations, and with the specific approval of the AD Category – I bank with whom the account is opened. 6. No fund based / non-fund based facilities shall be permitted against the balance in the accounts. 7. Requirement of compliance with KYC guidelines issued by RBI shall rest with the AD Category – I bank. 8. Balance in the Escrow Account, if any, may be repatriated at the then prevailing exchange rate (i.e. the exchange rate risk will be borne by the overseas company acquiring the shares), after all the formalities in respect of the said acquisition are completed . 9. In the event, the proposal under the said acquisition/transfer does not materialise, the AD Category – I bank may allow repatriation of the entire amount lying to the credit of the Escrow Account on being satisfied with the bonafides of such remittances. 10. The accounts shall be closed immediately after completing the requirements as outlined above. |