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CS Executive · Economic, Commercial and Intellectual Property Laws · Law relating to Foreign Contribution Regulation

Bharat Textiles Ltd, a company incorporated in India, has a wholly owned associate branch in Dhaka. A question arises whether the FCRA, 2010 reaches that overseas branch. Which is correct under the Act's application clause?

The Act applies to associate branches or subsidiaries outside India of companies or bodies corporate registered or incorporated in India. So Bharat Textiles' Dhaka branch is covered. The clause has no requirement of listing or of any company-specific notification.

  1. AThe Act applies to associate branches or subsidiaries outside India of companies registered or incorporated in IndiaCorrect
  2. BThe Act does not reach any entity located outside India
  3. CThe Act applies to overseas branches only of companies listed on a stock exchange
  4. DThe Act applies to overseas subsidiaries only after separate Central Government notification for each company

Explanation

Section 1(2)(b) expressly applies the Act to associate branches or subsidiaries, outside India, of companies or bodies corporate registered or incorporated in India. There is no listing or per-company notification condition in that clause.

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