Investment from a Dutch entity into an Indian company is foreign direct investment under FEMA and the Non-Debt Instruments Rules 2019. Shares must be issued at or above fair value, reported in Form FC-GPR within 30 days of allotment, transfers between residents and non-residents reported in Form FC-TRS, and the annual return on foreign liabilities and assets filed with the RBI. Sectoral caps and conditions apply, and land-border beneficial ownership triggers government approval.
- Document route
- Notaris or municipal legalisation, then apostille from the rechtbank
- Time difference
- India is 3.5 hours (summer) to 4.5 hours (winter) ahead
- Law
- FEMA 1999 and NDI Rules 2019
- New shares
- FC-GPR within 30 days of allotment
FDI & FEMA Compliance from the Netherlands: how it works
We start with a FEMA health check: the sector and route, the beneficial ownership chain behind the Dutch entity, the pricing of each past issue and transfer, and whether every filing on the FIRMS portal was made on time. Dutch holding structures often involve layered ownership and reorganisations, such as a merger of two BVs or a transfer of Indian shares between group companies. Each of these may be an indirect transfer or a transfer between non-residents that needs Indian tax and FEMA analysis. We also check downstream investment by the Indian company, which counts as indirect foreign investment if the Indian company is foreign-owned.
Where filings were missed, we prepare late submission with fees or, for more serious breaches, a compounding application to the RBI. For new investments we build a timetable: valuation by a chartered accountant or merchant banker, board and shareholder approvals, receipt of funds, allotment within the permitted period, and filing. Convertible instruments such as compulsorily convertible preference shares need their conversion formula fixed upfront. Repatriation of dividends and buyback proceeds to the Netherlands follows its own documentation, including tax deduction under India's tax treaty with the Netherlands.
What clients in the Netherlands should know
- Optionally convertible or redeemable instruments are treated as debt under FEMA, so Dutch investors should use equity or compulsorily convertible instruments for FDI.
- Transfers of Indian shares from a Dutch BV to another non-resident group company may still need Indian tax analysis and, depending on the facts, reporting.
- The annual return on foreign liabilities and assets is due every year by mid-July even if nothing changed; missing it is a common default for Dutch-owned companies.
Step by step from the Netherlands
Video consultation
A call at a time that suits the Netherlands, after we have read your documents.
Documents signed in the Netherlands
Notaris or municipal legalisation, then apostille from the rechtbank
Work in India
Our team files, appears and follows up in India, and shares scans of everything filed.
Result and handover
Certified copies and originals are couriered to you in the Netherlands where needed.
The full guide
This page covers what changes when you are in the Netherlands. For the law, the documents and the step-by-step procedure, read our main page on FDI & FEMA Compliance, or see all services for clients in the Netherlands and the Doing Business in India practice area.
Questions from clients in the Netherlands
What happens if FC-GPR was filed late?
The RBI allows late submission with a fee in many cases. Longer or repeated delays may need compounding. We review the history and choose the right route.
Does a Dutch fund need approval to invest in an Indian fintech?
Often not, but some financial services activities have specific conditions or licensing. We check the sector rules before the term sheet is signed.
Can the Indian subsidiary borrow from the Dutch parent?
Yes, through the external commercial borrowing framework, which has its own limits, cost ceilings and reporting.