Initial Reporting at the Time of Investment

• When a foreign investor subscribes to shares in a JV, the Indian JV company must report the receipt of foreign funds to the Reserve Bank of India (RBI) through an Authorized Dealer (AD) Bank.
  
• This is done using the Advance Reporting Form (ARF) within 30 days of receiving the funds.
  
• The remittance must be supported by a Foreign Inward Remittance Certificate (FIRC) and a copy of the JV agreement or subscription terms.
  
• Delay in submission may attract penalties under the Foreign Exchange Management Act (FEMA), 1999.
  

Reporting of Share Allotment – Form FC-GPR

• After allotting shares to the foreign shareholder, the JV company must file Form FC-GPR (Foreign Currency-Gross Provisional Return) through the FIRMS portal.
  
• This form must be submitted within 30 days of allotment.
  
• The filing must include the valuation certificate, board resolution, KYC from the foreign investor’s bank, and share subscription details.
  
• The form confirms that the shares were issued in compliance with sectoral caps, pricing guidelines, and FDI policy.
  

Annual Filing – FLA Return

• Every JV company with foreign shareholding is required to file an Annual Return on Foreign Liabilities and Assets (FLA Return) with the RBI.
  
• The FLA Return must be filed by 15th July each year, based on the company’s financials as of 31st March.
  
• It includes details of foreign equity, debt, profit/loss, and changes in shareholding during the year.
  
• Filing is mandatory even if there is no change in foreign investment during the reporting year.
  

Changes in Shareholding – Form FC-TRS

• If a foreign shareholder transfers shares to a resident or another non-resident, the transaction must be reported using Form FC-TRS.
  
• This form must be filed within 60 days of the transfer.
  
• It is submitted by the resident buyer/seller through the FIRMS portal, with details of consideration, shareholding pattern, and supporting documents.
  
• Pricing must comply with RBI’s valuation norms, especially for unlisted companies.
  

Company Law and Statutory Disclosures

• In addition to RBI filings, the JV must disclose foreign shareholding in the Annual Return (Form MGT-7) filed with the Registrar of Companies (RoC).
  
• The Register of Members, Register of Foreign Shareholders, and Share Certificates must be properly maintained.
  
• Disclosures must also be made in the Board’s Report and financial statements.
  
• Any change in shareholding must be recorded and reflected in Form PAS-3 for allotment or Form SH-4 for transfer.