Introduction
Filing of FC-GPR (Foreign Currency-Gross Provisional Return) and FC-TRS (Foreign Currency-Transfer of Shares) forms is a crucial compliance requirement under the FEMA (Foreign Exchange Management Act), 1999, governed by the Reserve Bank of India (RBI). These filings ensure that all foreign investments into Indian companies and their transfer between residents and non-residents are tracked, regulated, and reported.
Why Are FC-GPR and FC-TRS Filing Important?
Regulatory Compliance
Filing these forms ensures that the Indian company is compliant with RBI and FEMA regulations.
Transparency
Maintains transparency in cross-border transactions involving foreign investments and transfers.
Legal Protection
Proper filing safeguards the company and its directors from legal consequences.
Avoidance of Penalties
Non-filing can attract significant penalties under FEMA.
What is FC-GPR?
Full Form:
Foreign Currency-Gross Provisional Return
The FC-GPR form is filed when a company in India receives foreign investment. It is a declaration made to the RBI to report the issue of shares to a foreign investor against the inflow of foreign funds.
Who Needs to File It?
- Indian companies issuing shares, debentures, or other securities to foreign investors (non-residents).
- Startups and private limited companies receiving foreign direct investments (FDIs).
Why Is It Required?
- To report the inflow of foreign funds and the allotment of securities.
- To ensure that the company complies with FEMA regulations and FDI policy.
- To maintain transparency and accountability for foreign investments.
1-Governing Body:
Reserve Bank of India under FEMA.
2-Timelines for Filing:
The FC-GPR form must be filed within 30 days of allotting securities to the foreign investor.
Penalties for Non-Filing of FC-GPR and FC-TRS
The FC-GPR form must be filed within 30 days of allotting securities to the foreign investor.
Penalty Amount
Up to 300% of the amount involved in the transaction.
Additional Fines
If the exact amount cannot be quantified, a penalty of up to ₹2 lakhs may be imposed, with an additional fine of ₹5,000 per day for continued non-compliance.
Impact: Delay or non-filing
can lead to reputational damage and complications in future transactions.
What is FC-TRS?
Full Form:
Foreign Currency-Transfer of Shares
The FC-TRS form is filed when shares or other securities are transferred from a resident to a non-resident or vice versa.
Who Needs to File It?
- Resident individuals or entities transferring shares to non-residents.
- Non-resident individuals or entities transferring shares to residents.
Why Is It Required?
- To report the transfer of ownership in a company and ensure compliance with FEMA regulations.
- To maintain a record of transactions involving cross-border ownership.
- To track FDI inflow and outflow related to share transfers.
1-Governing Body:
Reserve Bank of India under FEMA.
2-Timelines for Filing:
The FC-TRS form must be filed within 60 days of receiving payment for the transfer of shares.
Steps to File FC-GPR and FC-TRS
Steps for Filing FC-GPR
- Receive the foreign investment into the company’s bank account.
- Allot shares or securities to the foreign investor within 180 days of receiving the funds.
- Prepare the necessary documents:
- Board resolution for allotment.
- Valuation certificate from a Chartered Accountant or SEBI-registered Merchant Banker.
- KYC report of the foreign investor from their bank.
- Declaration by the company and directors.
- File the FC-GPR form on the RBI’s FIRMS portal within 30 days of allotment.
Steps for Filing FC-TRS
- Execute the transfer agreement between the resident and non-resident parties.
- Receive payment for the transfer of shares.
- Prepare the required documents:
- Consent letters from buyer and seller.
- Shareholding pattern before and after the transaction.
- KYC details of the non-resident buyer or seller.
- Copy of the transfer agreement.
- File the FC-TRS form on the FIRMS portal within 60 days of the payment.
Key Differences Between FC-GPR and FC-TRS
Aspect | FC-GPR | FC-TRS |
Purpose | Reporting issue of shares to foreign investors | Reporting transfer of shares between resident and non-resident |
Filed By | Indian company | Resident or non-resident involved in the transfer |
Timeline | Within 30 days of allotment | Within 60 days of receipt of payment |
Governing Body | Reserve Bank of India (RBI) | Reserve Bank of India (RBI) |
Penalty for Non-Filing | Up to 300% of the amount involved or ₹2 lakhs | Up to 300% of the amount involved or ₹2 lakhs |
Documents Required for Filing
For FC-GPR:
- Certificate from the company’s directors and CS (if applicable).
- Valuation report.
- FIRC (Foreign Inward Remittance Certificate).
- KYC report for the foreign investor.
For FC-TRS:
- Copy of share purchase or transfer agreement.
- Consent letters from buyer and seller.
- Chartered Accountant’s certificate on valuation.
- FIRC for payment receipt.
- Bank account details of the foreign investor.
Why Choose Us for FC-GPR and FC-TRS Filing?
Expert Guidance
Our experienced team ensures accurate and timely filing of FC-GPR and FC-TRS forms.
Compliance Assurance
We help you stay compliant with FEMA and RBI regulations, avoiding penalties.
End-to-End Support
From document preparation to submission, we handle the entire process seamlessly.
Affordable Pricing
Transparent pricing without hidden charges.