In today’s era of globalization and increased foreign participation in Indian businesses, regulatory oversight plays a critical role in promoting transparency and ensuring compliance. One such compliance requirement for Indian companies receiving foreign direct investment (FDI) is the Form FC-GPR (Foreign Currency-Gross Provisional Return) filing with the Reserve Bank of India (RBI). It is a key part of India’s foreign exchange management framework under the Foreign Exchange Management Act, 1999 (FEMA). This article aims to give a concise yet comprehensive overview of the applicability, process, and key considerations surrounding FC-GPR filing.

What is Form FC-GPR?

Form FC-GPR is the prescribed form that a company incorporated in India must submit to the Reserve Bank of India (RBI) through the FIRMS portal when it issues equity instruments (such as shares, debentures, or convertible instruments) to a person resident outside India. This filing allows the RBI to monitor the flow of foreign investments into India and ensure compliance with FDI guidelines, sectoral caps, pricing norms, and other regulatory provisions.

It is important to note that the filing is transaction-specific, meaning it must be filed each time new shares or convertible instruments are issued to a foreign investor.

Legal Framework

The filing of Form FC-GPR falls under the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2017, read in conjunction with the FEMA 20(R) Notification. The RBI has delegated the administration and reporting responsibility to Authorized Dealer (AD) Category-I banks, which act as intermediaries between companies and the RBI.

The entire process is now conducted online through the FIRMS (Foreign Investment Reporting and Management System) portal, which has replaced the earlier eBiz portal.

Applicability of FC-GPR Filing

FC-GPR filing becomes applicable in the following scenarios:

1. Receipt of Foreign Investment: When an Indian company receives consideration from a person resident outside India against the issue of:

a. Equity shares

b. Compulsorily Convertible Preference Shares (CCPS)

c. Compulsorily Convertible Debentures (CCDs)

2. Allotment of Instruments: When the company allocates these instruments to the foreign investor.

3. Sectors under Automatic Route or Approval Route: Filing is required regardless of whether the investment is under the automatic route (no prior government approval needed) or the approval route (where prior approval from relevant ministries is necessary).

4. Bonus or Rights Issue to Foreign Investors: FC-GPR filing is also required when bonus shares or shares under a rights issue are allotted to non-resident shareholders.