Date: 2016-03-30Category: Extra OrdinaryState: Union GovernmentCountry: India
In exercise of the powers conferred by clause b of subsection 3 of Section 6 and Section 47 of the Foreign Exchange Management Act, 1999 42 of 1999, the Reserve Bank of India hereby makes the following amendments
Executive Summary:
This notification, issued by the Reserve Bank of India, introduces the Foreign Exchange Management Transfer or Issue of Security by a Person Resident outside India Fifth Amendment Regulations, 2016. These regulations, effective from the date of publication in the Official Gazette, amend the 2000 regulations concerning foreign investment in Indian insurance companies and intermediaries. The amendment revises the conditions and limits for foreign investment in the insurance sector.
Key Points / Main Content:
* **Amendment Overview:**
* The notification amends the Foreign Exchange Management Transfer or Issue of Security by a Person Resident outside India Regulations, 2000.
* **Revised FDI Policy for the Insurance Sector:**
* Foreign Direct Investment (FDI) in the insurance sector is capped at 49% through the automatic route, subject to IRDAI approval.
* The 49% cap applies to:
* Insurance Companies
* Insurance Brokers
* Third Party Administrators
* Surveyors and Loss Assessors
* Other Insurance Intermediaries appointed under the IRDA Act, 1999
* **Conditions for Foreign Investment:**
* Total foreign investment in an Indian Insurance Company's equity shares, including portfolio investors, cannot exceed 49% of the paid-up equity capital.
* Indian Insurance Companies must ensure ownership and control remain with resident Indian entities, as determined by the Department of Financial Services and IRDAI.
* Foreign portfolio investment is subject to FEMA Regulations, 2000 and SEBI regulations for Foreign Portfolio Investors, 2014.
* Any increase in foreign investment must align with the pricing guidelines specified by the Reserve Bank of India under FEMA regulations.
* **Specific Cases:**
* For entities like banks functioning as insurance intermediaries, the foreign equity investment caps applicable to their primary sector apply, provided their non-insurance revenues exceed 50% of total revenues.
* Provisions related to Banking-Private Sector, apply to bank-promoted insurance companies
* **Definitions:**
* Terms like "Control", "Equity Share Capital", "Foreign Direct Investment FDI", and others, will have the same meaning as provided in Notification No. G.S.R 115 E, dated 19th February, 2015 issued by Department of Financial Services and regulations issued by Insurance Regulatory and Development Authority of India from time to time.
Impact Analysis:
* **Indian Insurance Companies:**
* *Impact:* Need to comply with the revised FDI limits and ensure that ownership and control remain in the hands of resident Indian entities.
* *Action Required:* Obtain necessary licenses/approvals from IRDAI, adhere to pricing guidelines for foreign investment, and monitor foreign investment levels to ensure compliance.
* **Foreign Investors (including Portfolio Investors):**
* *Impact:* Subject to the 49% cap on total foreign investment in Indian insurance companies.
* *Action Required:* Ensure compliance with FEMA regulations, SEBI guidelines, and RBI pricing guidelines when investing in Indian insurance companies.
* **Insurance Regulatory and Development Authority of India (IRDAI):**
* *Impact:* Responsible for approval/verification of foreign investment, issuing licenses, and ensuring compliance with insurance regulations.
* *Action Required:* Monitor and regulate foreign investment in the insurance sector, provide necessary approvals, and issue guidelines for compliance.
* **Insurance Brokers, Third Party Administrators, Surveyors and Loss Assessors and Other Insurance Intermediaries:**
* *Impact:* Impacted by the 49% cap on foreign equity investment.
* *Action Required:* Ensure compliance with the 49% foreign equity investment cap.
Key Entities Referenced
Foreign Exchange Management Act, 1999: A law enacted by the Parliament of India to consolidate and amend the law relating to foreign exchange with the objective of facilitating external trade and payments and for promoting the orderly development and maintenance of foreign exchange market in India.
Reserve Bank of India: The central bank of India, responsible for the regulation of the Indian financial system, including foreign exchange management.
Foreign Exchange Management Transfer or Issue of Security by a Person Resident outside India Regulations, 2000: Regulations issued by the Reserve Bank of India under the Foreign Exchange Management Act, 1999, governing the transfer or issue of security by a person resident outside India.
Mumbai, Maharashtra: The city in Maharashtra where the Central Office of the Reserve Bank of India is located, from where the notification was issued.
Insurance Regulatory and Development Authority Act, 1999: An act of the Indian Parliament to protect the interests of holders of insurance policies, to regulate, promote and ensure orderly growth of the insurance industry and for matters connected therewith or incidental thereto.
Insurance Regulatory and Development Authority of India: A regulatory body established by the Insurance Regulatory and Development Authority Act, 1999 to regulate and develop the insurance industry in India.
Department of Financial Services: A department under the Ministry of Finance, Government of India, responsible for overseeing the financial sector, including insurance.
Securities and Exchange Board of India Foreign Portfolio Investors Regulations, 2014: Regulations issued by the Securities and Exchange Board of India (SEBI) governing foreign portfolio investors in the Indian securities market.
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EXTRAORDINARY
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PART II—Section 3—Sub-section (i)
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PUBLISHED BY AUTHORITY
la- 221] ubZ fnYyh] cq/okj] ekpZ 30] 2016@pS=k 10] 1938
No. 221] NEW DELHI, WEDNESDAY, MARCH 30, 2016/CHAITRA 10, 1938
भभभभााााररररततततीीीीयययय (cid:1)(cid:1)(cid:1)(cid:1)ररररज़ज़ज़ज़वववव (cid:5)(cid:5) (cid:5)(cid:5)बबबबकक(cid:7)(cid:7)कक(cid:7)(cid:7)
((((ििििववववददददशशशेेशेे ीीीी मममम(cid:3)(cid:3)ुु(cid:3)(cid:3)ुु ाााा ििििववववभभभभाााागगगग))))
((((कककक(cid:6)(cid:6)(cid:6)(cid:6)(cid:3)(cid:3)(cid:3)(cid:3)ीीीीयययय ककककााााययययाााालल(cid:9)(cid:9)लल(cid:9)(cid:9) यययय))))
अअअअििििधधधधससससचचूूचचूू ननननाााा
मु(cid:3) बई, 30 माच,(cid:8) 2016
सससस..ंं..ंं फफफफेेेेममममाााा.... 333366666666////2222000011116666----आआआआररररबबबबीीीी
ििििववववददददशशेेशशेे ीीीी मममम(cid:11)(cid:11)ुु(cid:11)(cid:11)ुु ाााा (cid:13)(cid:13)(cid:13)(cid:13)बबबबधधंंधधंं ((((भभभभााााररररतततत सससस ेे ेेबबबबााााहहहहरररर ककककेेेे ििििननननववववााााससससीीीी (cid:16)(cid:16)(cid:16)(cid:16)ककककससससीीीी (cid:19)(cid:19)(cid:19)(cid:19)िििि(cid:21)(cid:21)(cid:21)(cid:21) (cid:22)(cid:22)(cid:22)(cid:22)ाााारररराााा (cid:13)(cid:13)(cid:13)(cid:13)ििििततततभभभभििूूििूूतततत ककककाााा अअअअततंंततंं ररररणणणण अअअअथथथथववववाााा ििििननननगगगगमम(cid:5)(cid:5)मम(cid:5)(cid:5) )))) ((((पपपपााााचचंंचचंं ववववाााा ंं ंंससससशशंंशशंं ोोोोधधधधनननन))))
ििििववववििििननननययययममममााााववववललललीीीी,,,, 2222000011116666
ससससाााा....ककककाााा....ििििनननन.... 333366669999((((अअअअ))))—िवदशे ी म(cid:9)ु ा (cid:10)बंध अिधिनयम, 1999 (1999 का 42) क(cid:14) धारा 6 क(cid:14) उप-धारा (3) के खंड
(बी) और धारा 47 (cid:15)ारा (cid:10)द(cid:18) शि(cid:21)य(cid:23) का (cid:10)योग करत े (cid:26)ए, भारतीय (cid:28)रज़व(cid:8) ब(cid:31)क एत!ारा िवदशे ी म(cid:9)ु ा (cid:10)बंध (भारत स े
बाहर के िनवासी "कसी %ि(cid:21) (cid:15)ारा (cid:10)ितभूित का अंतरण अथवा िनग(cid:8)म) िविनयमावली, 2000 (3 मई 2000 क(cid:14)
अिधसूचना स.ं फेमा.20/2000-आरबी) म )िन*िलिखत संशोधन करता ह,ै अथा(cid:8)त:-
1111.... ससससििंंििंं(cid:28)(cid:28)(cid:28)(cid:28)(cid:29)(cid:29)(cid:29)(cid:29) ननननाााामममम औऔऔऔरररर (cid:13)(cid:13)(cid:13)(cid:13)ााााररररंंभभंंभभ
(i) ये िविनयम िवदशे ी मु(cid:9)ा (cid:10)बंध (भारत स े बाहर के िनवासी "कसी %ि(cid:21) (cid:15)ारा (cid:10)ितभिू त का अंतरण अथवा िनगम(cid:8) )
(पांचवा ंसंशोधन) िविनयमावली, 2016 कहलाएगं ।े
(ii) वे सरकारी राजप2 म )उनके (cid:10)काशन क(cid:14) तारीख से लागू ह(cid:23)गे।
1565 GI/2016 (1)2 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(i)]
2222.... अअअअननननससुुससुु चचूूचचूू ीीीी 1111 मममम (cid:30)(cid:30) (cid:30)(cid:30)ससससशशंंशशंं ोोोोधधधधनननन ::::----
िवदशे ी म(cid:9)ु ा (cid:10)बंध (भारत स ेबाहर के िनवासी "कसी %ि(cid:21) (cid:15)ारा (cid:10)ितभिू त का अंतरण अथवा िनगम(cid:8) ) िविनयमावली, 2000,
(3 मई 2000 क(cid:14) अिधसूचना स.ं फेमा. 20/2000-आरबी) म,) अनुसूची 1 म,) मौजूदा अनुबंध 'बी' म,)—
i. मौजदू ा मद स ं.एफ़. 7, एफ़. 7.1 और एफ़. 7.2 को िन*िलिखत स े(cid:10)ित7थािपत "कया जाएगा :
एएएएफ़फ़फ़फ़....7777.... बबबबीीीीममममाााा %%%% इइइइ(cid:16)(cid:16)(cid:16)(cid:16)$$$$टटटटीीीी////एएएएफ़फ़फ़फ़डडडडीीीीआआआआईईईई कककक,,,, (cid:13)(cid:13)(cid:13)(cid:13)ववववशशेेशशेे ममममाााागगगग (cid:5)(cid:5) (cid:5)(cid:5)
ससससीीीीममममाााा
एफ़.7.1 बबबबीीीीममममाााा 49% 7वचािलत माग(cid:8)
स े
(i) बीमा कंपनी
(ii) बीमा 8ोकर
(iii) थड (cid:8)पाट; एडिमिन7<ेटर
(iv) सव=यर और हािन आकलक (loss assessors)
(v) बीमा िविनयामक और िवकास (cid:10)ािधकरण अिधिनयम,
(41 का 1999) 1999के उपबंध(cid:23) के अंतग(cid:8)त िनय(cid:21)ु अ@य
मAयवत; बीमा सं7थाएं
एफ़. 7.2 अ@य शतB :
(ए) कोई भी भारतीय बीमा कंपनी पोट(cid:8)फोिलयो िनवेशक(cid:23) सिहत िवदशे ी िनवेशक(cid:23) (cid:15)ारा अपन े ई"Eटी शेयर(cid:23)
म) कुल िवदशे ी िनवेशक(cid:23) क(cid:14) समF होGHडग अपनी (ऐसी भारतीय बीमा कंपनी क(cid:14)) (cid:10)द(cid:18) ई"Eटी पूंजी के
49% से अिधक नहO होने दगे ी;
(बी) भारतीय बीमा कंपनी क(cid:14) कुल (cid:10)द(cid:18) ई"Eटी पूंजी के 49% क(cid:14) सीमा तक (cid:10)QयR िवदशे ी िनवेश 7वचािलत
माग(cid:8) के तहत अनमु त होगा, बशत= बीमा िविनयामक और िवकास (cid:10)ािधकरण (cid:15)ारा अनुमोदन/सQयापन "कया
गया हो।
(सी) इस Rे2 म) होने वाला (cid:10)QयR िवदशे ी िनवेश बीमा अिधिनयम, 1938 के (cid:10)ावधान(cid:23) और इस शत (cid:8) के
अधीन होगा "क एफडीआई (cid:10)ाT करन े वाली कंपिनया ं बीमा और संबंिधत गितिविधय(cid:23) के िलए बीमा
िविनयामक और िवकास (cid:10)ािधकरण (IRDA) स ेआवVयक लाइसस) /अनमु ोदन (cid:10)ाT कर)गी।
(डी) भारतीय बीमा कंपनी यह सुिनिXत करेगी "क उसका 7वािमQव एवं िनयं2ण समय-समय पर िव(cid:18)ीय
सेवाए ँ िवभाग/बीमा िविनयामक और िवकास (cid:10)ािधकरण (IRDAI) (cid:15)ारा जारी िनयम(cid:23)/िविनयम(cid:23) के अनसु ार
उनके (cid:15)ारा "कए गए िनधा(cid:8)रणानुसार हमेशा िनवासी भारतीय एं(cid:28)टटीय(cid:23) के हाथ म) रहगे ा।
(ई) भारतीय बीमा कंपनी म) िवदशे ी पोट(cid:8)फोिलयो िनवेश फेमा िविनयमावली, 2000 के िविनयम 5 के उप-
िविनयम (2), (2ए), (3) एवं (8) तथा भारतीय (cid:10)ितभिू त एवं िविनमय बोड (cid:8) (िवदेशी पोट(cid:8)फोिलयो िनवेशक)
िविनयमावली, 2014 के (cid:10)ावधान(cid:23) के अधीन होगा।
(एफ़) भारतीय बीमा कंपनी म) िवदशे ी िनवेश म) "कसी भी (cid:10)कार क(cid:14) बढ़ो(cid:18)री भारतीय (cid:28)रज़व (cid:8) ब(cid:31)क (cid:15)ारा फेमा
िविनयमावली म) "दए गए क(cid:14)मत िनधा(cid:8)रण संबंधी "दशािनदश= (cid:23) के अधीन हो सकेगी ।
(जी) 49% तक क(cid:14) िवदशे ी ई"Eटी िनवशे क(cid:14) सीमा बीमा 8ोकर(cid:23), थड (cid:8)पाट; एि‘िन7<ेटर(cid:23), सव=यर(cid:23) एवं हािन
आकलक(cid:23) तथा बीमा िविनयामक और िवकास (cid:10)ािधकरण अिधिनयम, 1999 (1999 का 41) के तहत िनय(cid:21)ु
अ@य मAयवत; बीमा सं7थाa पर भी उिHलिखत समान शतb के साथ लाग ूहोगी।¹Hkkx IIµ[k.M 3(i)º Hkkjr dk jkti=k % vlk/kj.k 3
(एच) बशत= यह "क बीमा िविनयामक और िवकास (cid:10)ािधकरण (cid:15)ारा मAयवत; बीमा सं7था के cप म ) अनुमत
कोई ए(cid:28)ं टटी य"द ब(cid:31)क ह,ै िजसका (cid:10)ाथिमक कारोबार बीमा Rे2 स े िभe (अथा(cid:8)त गैर-बीमा) ह,ै तो उसम )
िवदशे ी ई"Eटी िनवेश क(cid:14) उfतम सीमा उस Rे2 के िलए लाग ू सीमा होगी। यह भी "क "कसी भी िव(cid:18) वष(cid:8) म )
उस ए(cid:28)ं टटी का अपने (cid:10)ाथिमक कारोबार (गरै -बीमा Rे2 स)े से (cid:10)ाT राज7व उसके समF राज7व के 50% स े
अिधक होना चािहए।
(आई) ब(cid:31)क (cid:10)वhतत (promoted) बीमा कंपिनय(cid:23) के िलए “बi(cid:31) कग-िनजी Rे2” संबंधी पैराFाफ स.ं एफ़
2.2(4)(i)(b) एवं (d) के उपबधं लागू ह(cid:23)गे।
(ज)े शkदावली : - ‘िनयं2ण’, ‘इ"Eटी शेयर पूंजी’, ‘(cid:10)QयR िवदशे ी िनवेश (एफ़डीआई)’, ‘िवदशे ी िनवेशक’,
‘िवदशे ी पोट(cid:8)फोिलयो िनवेशक’, ‘भारतीय बीमा कंपनी’, ‘भारतीय कंपनी’, ‘भारतीय बीमा कंपनी पर भारतीय
िनयं2ण’, ‘भारतीय 7वािमQव’, ‘अिनवासी ए(cid:28)ं टटी’, ‘साव(cid:8)जिनक िव(cid:18)ीय सं7था’, ‘िनवासी भारतीय नाग(cid:28)रक’,
‘कुल िवदशे ी िनवेश’ का अथ (cid:8) वही होगा जो िव(cid:18)ीय सेवाएँ िवभाग (cid:15)ारा जारी 19 फरवरी 2015 क(cid:14)
अिधसूचना स.ं सा.का.िन.115(अ) म) और बीमा िविनयामक और िवकास (cid:10)ािधकरण (IRDA) (cid:15)ारा
समय-समय पर जारी िविनयम(cid:23) म) "दया गया ह।ै
[सं. 1/11/ईएम-2016]
आर एल शमा,(cid:8) मुoय महा(cid:10)बंधक
पपपपाााादददद----(cid:1)(cid:1)(cid:1)(cid:1)टटटट....पपपपणणणणीीीी ::::----मलू िविनयमावली 8 मई 2000 को सा.का.िन. स.ं406(अ) भाग-II, खंड 3, उप-खंड (i) के तहत सरकारी
राजप2 के म )(cid:10)कािशत और तQपXात िन*िलिखत (cid:15)ारा संशोिधत क(cid:14) गयी:-
सा.का.िन. सं. 158(अ) "दनाकं 02.03.2001 सा.का.िन. सं. 513(अ) "दनाकं 29.07.2005
सा.का.िन. सं. 175(अ) "दनाकं 13.03.2001 सा.का.िन. सं. 738(अ) "दनाकं 22.12.2005
सा.का.िन. सं. 182(अ) "दनाकं 14.03.2001 सा.का.िन. सं. 29(अ) "दनाकं 19.01.2006
सा.का.िन. सं. 4(अ) "दनाकं 02.01.2002 सा.का.िन. सं. 413(अ) "दनाकं 11.07.2006
सा.का.िन. सं. 574(अ) "दनाकं 19.08.2002 सा.का.िन. सं. 712(अ) "दनाकं 14.11.2007
सा.का.िन. सं. 223(अ) "दनाकं 18.03.2003 सा.का.िन. सं. 713(अ) "दनाकं 14.11.2007
सा.का.िन. सं. 225(अ) "दनाकं 18.03.2003 सा.का.िन. सं. 737(अ) "दनाकं 29.11.2007
सा.का.िन. सं. 558(अ) "दनाकं 22.07.2003 सा.का.िन. सं. 575(अ) "दनाकं 05.08.2008
सा.का.िन. सं. 835(अ) "दनाकं 23.10.2003 सा.का.िन. सं. 896(अ) "दनाकं 30.12.2008
सा.का.िन. सं. 899(अ) "दनाकं 22.11.2003 सा.का.िन. सं. 851(अ) "दनाकं 01.12.2009
सा.का.िन. सं. 12(अ) "दनाकं 07.01.2004 सा.का.िन. सं. 341(अ) "दनाकं 21.04.2010
सा.का.िन. सं. 278(अ) "दनाकं 23.04.2004 सा.का.िन. सं. 821(अ) "दनाकं 10.11.2012
सा.का.िन. सं. 454(अ) "दनाकं 16.07.2004 सा.का.िन. सं. 606(अ) "दनाकं 03.08.2012
सा.का.िन. सं. 625(अ) "दनाकं 21.09.2004 सा.का.िन. सं. 795(अ) "दनाकं 30.10.2012
सा.का.िन. सं. 799(अ) "दनाकं 08.12.2004 सा.का.िन. सं. 796(अ) "दनाकं 30.10.2012
सा.का.िन. सं. 201(अ) "दनाकं 01.04.2005 सा.का.िन. सं. 797(अ) "दनाकं 30.10.2012
सा.का.िन. सं. 202(अ) "दनाकं 01.04.2005 सा.का.िन. सं. 945(अ) "दनाकं 31.12.2012
सा.का.िन. सं. 504(अ) "दनाकं 25.07.2005 सा.का.िन. सं. 946(अ) "दनाकं 31.12.2012
सा.का.िन. सं. 505(अ) "दनाकं 25.07.2005 सा.का.िन. सं. 38(अ) "दनाकं 22.01.20134 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(i)]
सा.का.िन. सं. 515(अ) "दनाकं 30.07.2013 सा.का.िन. सं. 400(अ) "दनाकं 12.06.2014
सा.का.िन. सं. 532(अ) "दनाकं 05.08.2013 सा.का.िन. सं. 436(अ) "दनाकं 08.07.2014
सा.का.िन. सं. 341(अ) "दनाकं 28.05.2013 सा.का.िन. सं. 487(अ) "दनाकं 11.07.2014
सा.का.िन. सं. 344(अ) "दनाकं 29.05.2013 सा.का.िन. सं. 632(अ) "दनाकं 02.09.2014
सा.का.िन. सं. 195(अ) "दनाकं 01.04.2013 सा.का.िन. सं. 798(अ) "दनाकं 13.11.2014
सा.का.िन. सं. 393(अ) "दनाकं 21.06.2013 सा.का.िन. सं. 799(अ) "दनाकं 13.11.2014
सा.का.िन. सं. 591(अ) "दनाकं 04.09.2013 सा.का.िन. सं. 800(अ) "दनाकं 13.11.2014
सा.का.िन. सं. 596(अ) "दनाकं 06.09.2013 सा.का.िन. सं. 829(अ) "दनाकं 21.11.2014
सा.का.िन. सं. 597(अ) "दनाकं 06.09.2013 सा.का.िन. सं. 906(अ) "दनाकं 22.12.2014
सा.का.िन. सं. 681(अ) "दनाकं 11.10.2013 सा.का.िन. सं. 914(अ) "दनाकं 24.12.2014
सा.का.िन. सं. 682(अ) "दनाकं 11.10.2013 सा.का.िन. सं. 30(अ) "दनाकं 14.01.2015
सा.का.िन. सं. 818(अ) "दनाकं 31.12.2013 सा.का.िन. सं. 183(अ) "दनाकं 12.03.2015
सा.का.िन. सं. 805(अ) "दनाकं 30.12.2013 सा.का.िन. सं. 284(अ) "दनाकं 13.04.2015
सा.का.िन. सं. 683(अ) "दनाकं 11.10.2013 सा.का.िन. सं. 484(अ) "दनाकं 11.06.2015
सा.का.िन. सं. 189(अ) "दनाकं 19.03.2014 सा.का.िन. सं. 745(अ) "दनाकं 30.09.2015
सा.का.िन. सं. 190(अ) "दनाकं 19.03.2014 सा.का.िन. सं. 759(अ) "दनाकं 06.10.2015
सा.का.िन. सं. 270(अ) "दनाकं 07.04.2014 सा.का.िन. सं. 823(अ) "दनाकं 30.10.2015
सा.का.िन. सं. 361(अ) "दनाकं 27.05.2014 सा.का.िन. सं. 858(अ) "दनाकं 16.11.2015
सा.का.िन. सं. 370(अ) "दनाकं 30.05.2014 सा.का.िन. सं. 165(अ) "दनाकं 15.02.2016
सा.का.िन. सं. 371(अ) "दनाकं 30.05.2014 सा.का.िन. सं. 166(अ) "दनाकं 15.02.2016
सा.का.िन. सं. 435(अ) "दनाकं 08.07.2014
RESERVE BANK OF INDIA
(Foreign Exchange Department)
(CENTRAL OFFICE)
NOTIFICATION
Mumbai, the 30th March, 2016
No.FEMA.366/ 2016-RB
Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India)
(Fifth Amendment) Regulations, 2016
G.S.R. 369(E).—In exercise of the powers conferred by clause (b) of sub-section (3) of Section 6
and Section 47 of the Foreign Exchange Management Act, 1999 (42 of 1999), the Reserve Bank of India
hereby makes the following amendments in the Foreign Exchange Management (Transfer or Issue of
Security by a Person Resident outside India) Regulations, 2000 (Notification No. FEMA. 20/2000-RB dated
3rd May 2000) namely:—
1. Short Title and Commencement
(i) These Regulations may be called the Foreign Exchange Management (Transfer or Issue of Security by a
Person Resident outside India) (Fifth Amendment) Regulations, 2016.
(ii) They shall come into force from the date of their publication in the Official Gazette.¹Hkkx IIµ[k.M 3(i)º Hkkjr dk jkti=k % vlk/kj.k 5
2. Amendment of the Schedule 1
In the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India)
Regulations, 2000, (Notification No. FEMA 20/2000-RB dated 3rd May 2000), in Schedule 1, in the
existing Annex B,
i. The existing entry F.7, F.7.1 and F.7.2 shall be substituted by the following:—
F.7. Insurance % of equity/FDI Entry route
Cap
F.7.1 Insurance 49% Automatic
(i) Insurance Company
(ii) Insurance Brokers
(iii) Third Party Administrators
(iv) Surveyors and Loss Assessors
(v) Other Insurance Intermediaries appointed under the
provisions of Insurance Regulatory and Development
Authority Act, 1999 (41 of 1999)
F.7.2 Other Conditions
a) No Indian Insurance Company shall allow the aggregate holdings by way of total foreign
investment in its equity shares by foreign investors, including portfolio investors, to exceed
forty-nine percent of the paid up equity capital of such Indian Insurance company.
b) The foreign investment up to forty-nine percent of the total paid-up equity of the Indian
Insurance Company shall be allowed on the automatic route subject to approval/verification by
the Insurance Regulatory and Development Authority of India.
c) Foreign investment in this sector shall be subject to compliance with the provisions of the
Insurance Act, 1938 and the condition that Companies receiving FDI shall obtain necessary
license /approval from the Insurance Regulatory & Development Authority of India for
undertaking insurance and related activities.
d) An Indian Insurance Company shall ensure that its ownership and control remains at all times in
the hands of resident Indian entities as determined by Department of Financial Services/
Insurance Regulatory and Development Authority of India as per the rules/regulation issued by
them from time to time
e) Foreign portfolio investment in an Indian Insurance Company shall be governed by the
provisions contained in sub-regulations (2), (2A), (3) and (8) of Regulation 5 of FEMA
Regulations, 2000 and provisions of the Securities and Exchange Board of India (Foreign
Portfolio Investors) Regulations, 2014.
f) Any increase in foreign investment in an Indian Insurance Company shall be in accordance with
the pricing guidelines specified by Reserve Bank of India under the FEMA Regulations.
g) The foreign equity investment cap of 49 percent shall apply on the same terms as above to
Insurance Brokers, Third Party Administrators, Surveyors and Loss Assessors and Other
Insurance Intermediaries appointed under the provisions of the Insurance Regulatory and
Development Authority Act,1999 (41 of 1999).
h) Provided that where an entity like a bank, whose primary business is outside the insurance area,
is allowed by the Insurance Regulatory and Development Authority of India to function as an
insurance intermediary, the foreign equity investment caps applicable in that sector shall
continue to apply, subject to the condition that the revenues of such entities from their primary
(i.e., non-insurance related) business must remain above 50 percent of their total revenues in
any financial year.
i) The provisions of paragraphs F.2.2 (4) (i) (b) & (d), relating to ‘Banking-Private Sector’, shall
be applicable in respect of bank promoted insurance companies.
j) Terms ‘Control’, ‘Equity Share Capital’, ‘Foreign Direct Investment’ (FDI), ‘Foreign
Investors’, ‘Foreign Portfolio Investment’, ‘Indian Insurance Company’, ‘Indian Company’,6 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(i)]
‘Indian Control of an Indian Insurance Company’, ‘Indian Ownership’, ‘Non-resident Entity’,
‘Public Financial Institution’, ‘Resident Indian Citizen’, ‘Total Foreign Investment’ will have
the same meaning as provided in Notification No. G.S.R 115 (E), dated 19th February, 2015
issued by Department of Financial Services and regulations issued by Insurance Regulatory and
Development Authority of India from time to time.
[No. 1/11/EM-2016]
R. L. SHARMA, Chief General Manager
Foot Note:-
The Principal Regulations were published in the Official Gazette vide G.S.R. No. 406(E) dated May 8, 2000
in Part II, Section 3, Sub-section (i) and subsequently amended as under:—
G.S.R. No. 158(E) dated 02.03.2001 G.S.R. No. 896(E) dated 30.12.2008
G.S.R. No. 175(E) dated 13.03.2001 G.S.R. No. 851(E) dated 01.12.2009
G.S.R. No. 182(E) dated 14.03.2001 G.S.R. No. 341 (E) dated 21.04.2010
G.S.R. No. 4(E) dated 02.01.2002 G.S.R. No. 821 (E) dated 10.11.2012
G.S.R. No. 574(E) dated 19.08.2002 G.S.R. No. 606(E) dated 03.08.2012
G.S.R. No. 223(E) dated 18.03.2003 G.S.R. No. 795(E) dated 30.10.2012
G.S.R. No. 225(E) dated 18.03.2003 G.S.R. No. 796(E) dated 30.10.2012
G.S.R. No. 558(E) dated 22.07.2003 G.S.R. No. 797(E) dated 30.10.2012
G.S.R. No. 835(E) dated 23.10.2003 G.S.R. No. 945 (E) dated 31.12.2012
G.S.R. No. 899(E) dated 22.11.2003 G.S.R. No. 946(E) dated 31.12.2012
G.S.R. No. 12(E) dated 07.01.2004 G.S.R. No. 38(E) dated 22.01.2013
G.S.R. No. 278(E) dated 23.04.2004 G.S.R. No. 515(E) dated 30.07.2013
G.S.R. No. 454(E) dated 16.07.2004 G.S.R. No. 532(E) dated 05.08.2013
G.S.R. No. 625(E) dated 21.09.2004 G.S.R. No. 341(E) dated 28.05.2013
G.S.R. No. 799(E) dated 08.12.2004 G.S.R. No. 344(E) dated 29.05.2013
G.S.R. No. 201(E) dated 01.04.2005 G.S.R. No.195(E) dated 01.04.2013
G.S.R. No. 202(E) dated 01.04.2005 G.S.R. No. 393(E) dated 21.06.2013
G.S.R. No. 504(E) dated 25.07.2005 G.S.R. No. 591(E) dated 04.09.2013
G.S.R. No. 505(E) dated 25.07.2005 G.S.R. No. 596(E) dated 06.09.2013
G.S.R. No. 513(E) dated 29.07.2005 G.S.R. No. 597(E) dated 06.09.2013
G.S.R. No. 738(E) dated 22.12.2005 G.S.R. No. 681(E) dated 11.10.2013
G.S.R. No. 29(E) dated 19.01.2006 G.S.R. No. 682(E) dated 11.10.2013
G.S.R. No. 413(E) dated 11.07.2006 G.S.R. No. 818(E) dated 31.12.2013
G.S.R. No. 712(E) dated 14.11.2007 G.S.R. No. 805(E) dated 30.12.2013
G.S.R. No. 713(E) dated 14.11.2007 G.S.R. No. 683(E) dated 11.10.2013
G.S.R. No. 737(E) dated 29.11.2007 G.S.R. No. 189(E) dated 19.03.2014
G.S.R. No. 575(E) dated 05.08.2008 G.S.R. No. 190(E) dated 19.03.2014¹Hkkx IIµ[k.M 3(i)º Hkkjr dk jkti=k % vlk/kj.k 7
G.S.R. No. 270(E) dated 07.04.2014 G.S.R. No. 906(E) dated 22.12.2014
G.S.R. No. 361 (E) dated 27.05.2014 G.S.R. No. 914 (E) dated 24.12.2014
G.S.R. No. 370(E) dated 30.05.2014 G.S.R. No. 30 (E) dated 14.01.2015
G.S.R. No. 371(E) dated 30.05.2014 G.S.R. No. 183 (E) dated 12.03.2015
G.S.R. No. 435 (E) dated 08.07.2014 G.S.R. No. 284 (E) dated 13.04.2015
G.S.R. No. 400 (E) dated 12.06.2014 G.S.R. No. 484 (E) dated 11.06.2015
G.S.R. No. 436 (E) dated 08.07.2014 G.S.R. No. 745 (E) dated 30.09.2015
G.S.R. No. 487 (E) dated 11.07.2014 G.S.R. No. 759(E) dated 06.10.2015
G.S.R. No. 632 (E) dated 02.09.2014 G.S.R. No. 823(E) dated 30.10.2015
G.S.R. No. 798 (E) dated 13.11.2014 G.S.R. No. 858(E) dated 16.11.2015
G.S.R. No. 799 (E) dated 13.11.2014 G.S.R. No. 165(E) dated 15.02.2016
G.S.R. No. 800 (E) dated 13.11.2014 G.S.R. No. 166(E) dated 15.02.2016
G.S.R. No. 829 (E) dated 21.11.2014
Uploaded by Dte. of Printing at Government of India Press, Ring Road, Mayapuri, New Delhi-110064
and Published by the Controller of Publications, Delhi-110054.