Acquisition of shares, etc., of print
media companies

AP (DIR Series) (2000-2001) Circular No. 26, dated 22-2-2001

Facility to FIIs/NRIs/OCBs and FVCIs to purchase shares or convertible debentures of an
Indian company, engaged in print media sector to be withdrawn

1. Attention of authorised dealers is invited to “Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000” notified under Notification No. FEMA 20/2000-RB, dated 3rd May, 2000. In terms of sub-regulations (2), (3) and (5) of regulation 5, Foreign Institutional Investors (FIIs)/Non-Resident Indians (NRIs)/Overseas Corporate Bodies (OCBs) and Foreign Venture Capital Investors (FVCIs) were permitted to purchase shares and convertible debentures of Indian Companies.

2. In consultation with the Government of India, it has now been decided that the facility to FIIs/NRIs/OCBs and FVCIs to purchase shares or convertible debentures of an Indian Company which is engaged in the print media sector should be withdrawn. Accordingly, the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000 have been amended vide Notification No. FEMA 35/2000-RB, dated 16th February, 2001. It is clarified that the restriction shall also apply to purchase of shares and convertible debentures by NRIs and OCBs on non-repatriation basis.

3. Authorised Dealers may bring the contents of this circular to the notice of their constituents concerned.

4. The directions contained in this circular have been issued under section 10(4) and section 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999). Any contravention or non-observance of these directions is subject to the penalties prescribed under the Act.