Doing Business in India - RSM Austria

issued by Reserve Bank from time to time. The period of such Letters of credit /
guarantees / LoU / LoC has to be co-terminus with the period of credit, reckoned
from the date of shipment.
3.5 Time period for realization of Export payments
The present period of realization and repatriation of the amount to India of export
value of goods or software exported is 12 months.
However, no specific time period for realization and repatriation of the amount to
India of export value of goods or software exported by a unit situated in Special
Economic Zone (SEZ) has been specified. In case of exports made to warehouses,
established outside India, as soon as it is realized or in any case within 15 months
from the date of shipment of goods.
3.6 Time period for payment towards Import obligations
Remittances of payments against imports should be generally completed not later
than 6 months from the date of shipment, except in cases where amounts are
withheld towards guarantee of performance.
4.0 EXCHANGE CONTROL REGULATIONS - FOREIGN
TECHNOLOGY TRANSFER AND ROYALTY
PAYMENTS
A foreign investment is now no longer linked with the technical assistance. As such,
now, it is possible for foreign investor to either do equity investment or enter into
technology transfer agreement. It is also possible to do foreign investment as well
as technical collaboration. Technology transfer can take place in many forms and
methods. It comprises of various species of intellectual property like copy right,
patents, trade marks, designs, know how etc. Technology transfer agreement may
involve a one-time payment of fees or it may involve longer-term arrangements
with periodic royalty payments.
The remittance under technical agreements is a current account transaction and as
such is freely remittable.
The Government of India permits the payments for royalty, lump sum fee for
transfer of technology and payments for use of trademark/brand name on the
automatic route i.e. without any approval of the Government of India. In other
words, there shall be no restriction on limits of royalty payments from India and can
be remitted without any approval of Government or Reserve Bank of India
However, all such payments will be subject to Foreign Exchange Management
(Current Account Transactions) Rules, 2000 as amended from time to time. A
suitable post-reporting system for technology transfer/ collaborations and use of
trade mark/ brand name will be notified by the Government separately soon.
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DOING BUSINESS IN INDIA