CS Shruti Bansal
The Reserve Bank has come up with the objective of integrating the extant reporting structures of various types of foreign investment in India, and for this purpose it will introduce a Single Master Form (SMF) subsuming all the existing reports.
To implement the abovementioned, RBI is introducing an online application, FIRMS (Foreign Investment Reporting and Management System), which would provide for the SMF.
FIRMS would be made online in two phases:
In the first phase, the Entity Master is made available online. This is available to the public for data entry between June 28 (at 1:00 pm) and July 12, 2018. In this phase, all existing foreign investment detail is to be provided, irrespective of the fact that the regulatory reporting to the Reserve Bank for the same has been made or not and whether the same has been acknowledged or not.
Definition of Entity user:
♦ a person authorized by the entity (company/ LLP/startup) to register an entity in the Entity Master of FIRMS application.
♦ Only he has the right to add/update the foreign investment details of an Entity
♦ One person can also be an entity user for more than one entity
First Phase Registration Process:
i. Visit Uniform Resource Locators (URL) of the application https://firms.rbi.org.in
ii. Register yourself as Entity user by attaching authority letter from the entity in the format given in the notification link below.
iii. The Entity user may keep ready all details of foreign investment in the entity.
For detailed registration procedure and form filling instructions, please go through the link https://rbi.org.in/Scripts/NotificationUser.aspx?Id=11297&Mode=0
In the second phase, the second module containing 9 reports would be made available with effect from August 01, 2018. With the implementation of SMF, the reporting of FDI, which is presently a two-step procedure viz., ARF and FC-GPR would be merged into a single revised FC-GPR. The SMF also introduces reporting of indirect foreign investment through form DI and reporting of inflows in investment vehicles through Form InVi. Further, the reporting in FC-TRS, LLP-I, LLP-II, ESOP, DRR and CN would also be made in SMF only. The finalized structure of SMF and operational instructions thereof would be made available in the Master Direction on Reporting under FEMA, 1999.
Note: Indian entities not complying with these instructions will not be able to receive foreign investment (including indirect foreign investment) and will be treated as non-compliant with Foreign Exchange Management Act, 1999 (FEMA) and regulations made thereunder and liable for action as laid in FEMA or the regulations made thereunder.