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CMA Final · Corporate and Economic Laws · Compromises, Arrangements and Amalgamations

Under the Companies Act, 2013, a foreign company proposes to merge into an Indian company registered under the Act. Which approval is expressly required by the Act for this merger?

Prior approval of the Reserve Bank of India is required. Section 234(2) permits a foreign company to merge into an Indian-registered company, or the reverse, only with the RBI's prior approval, subject to other laws in force.

  1. APrior approval of the Reserve Bank of IndiaCorrect
  2. BPrior approval of the Securities and Exchange Board of India
  3. CPrior approval of the Competition Commission of India
  4. DPrior approval of the Registrar of Companies

Explanation

Section 234(2) states that a foreign company may, with the prior approval of the Reserve Bank of India, merge into a company registered under the Act or vice versa. The other bodies are not named in that provision.

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