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Ministry of Corporate Affairs recently came out with Notification No. G.S.R 555(E). dated 9 September 2024 allowing Foreign Holding Company to merge in Indian Wholly Owned Subsidiary Company with RBI Approval and following the Process under section 233 of the Companies Act, 2013 and rule 25 and 25A of Companies (Compromises, Arrangements and Amalgamations) Rules,2016. This Notification of MCA deems a soft a welcome to Parent Companies sitting in foreign to take most of it in the Growing Indian Economy.

It also gives clarity that Inbound Merger is possible through Fast Track Route under Section 233 of the Act. It shall be effective from 17 September 2024.

The erstwhile RBI Notification dated 20 March 2018 had given a blanket exemption under Rule 25A subject to declaration assuring Compliances.  

The recent notification of Ministry of Finance dated 28 August 2024 amending Securities Contracts (Regulation) Rules, 1957 is also a welcoming move inviting Foreign Companies to get the benefits of GIFT City and an option of merger may be explored.