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[Cites 0, Cited by 0] [Section 10(12)] [Section 10] [Entire Act]

Union of India - Subsection

Section 10(12)(a) in Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2017

(a)Any person being a promoter of a company registered in India (borrowing company), which has raised external commercial borrowing (ECB) in compliance with the Foreign Exchange Management (Borrowing and Lending in Foreign Exchange) Regulations, 2000 may pledge the shares of the borrowing company or that of its associate resident companies for the purpose of securing the external commercial borrowing (ECB) raised by the borrowing company subject to the following conditions:
(i)the period of such pledge shall be co-terminus with the maturity of the underlying external commercial borrowing;
(ii)in case of invocation of pledge, transfer shall be in accordance with these Regulations and directions issued by the Reserve Bank;
(iii)the Statutory Auditor has certified that the borrowing company will utilise/ has utilised the proceeds of the external commercial borrowing for the permitted enduse/s only;
(iv)no person shall pledge any such share unless a no-objection has been obtained from an Authorised Dealer bank that the above conditions have been complied with.