An overview of the compliance points businesses, investors and NRIs commonly face under FEMA. General legal information only.
The main framework
- Foreign investment into India: governed by the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 and related RBI directions.
- Overseas investment by Indian residents: governed by the overseas investment rules and directions.
- Reporting: investments and transfers generally need to be reported to the RBI within prescribed time limits, usually through the authorised dealer bank.
Common compliance points
- Whether the sector allows investment under the automatic route or needs government approval
- Pricing guidelines for issue and transfer of shares
- Timely filings after issue or transfer of shares
- The annual return on foreign liabilities and assets, where applicable
If a filing was missed
Many contraventions can be regularised by applying for compounding to the RBI. Adjudication of contraventions is handled by the Enforcement Directorate. Early advice generally helps.
Recent developments
The FEMA (NDI) Third Amendment Rules, 2026 extended Schedule III portfolio investment to individuals resident outside India. The RBI has also released draft Foreign Investment Rules, 2026 for comment, which are not in force. See the FEMA practice page.
How can Wise & Partners help?
The firm advises on structuring, filings and compounding. No outcome can be promised.
Important disclaimer: This article is general legal information, not legal advice. It does not create a lawyer-client relationship and is not an advertisement or solicitation under Bar Council of India rules. Verify current statutes, rules and judgments before relying on it.
