The International Financial Services Centres Authority on 25th March 2021 has published the International Financial Services Centres Authority (Finance Company) Regulations, 2021 which shall be applicable to any entity which desires to obtain certificate of registration from the Authority for carrying out the permissible activities as mentioned under this regulation.
A Finance Company can be set up either as a subsidiary or a joint venture, or as a newly incorporated company under the Companies Act, 2013, or in any other form as may be specified by the Authority from time to time: Provided that if an investing entity in a Finance Company is carrying out a regulated financial activity in its home jurisdiction, it shall obtain a No-objection Certificate from its home country regulator for setting up a Finance Company in the IFSCs, wherever applicable.
Further the Finance Company or a Finance Unit, as the case may be, shall carry out its operation in a freely convertible foreign currency and with such persons, whether resident or otherwise, as may be permitted by the Authority: Provided that a Finance Company or a Finance Unit, as the case may be, may be permitted to conduct such business transactions denominated in INR as may be specified by the Authority, subject to settlement of those business transactions in freely convertible foreign currency.
