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

Under the Companies Act, 2013, a scheme of merger between an Indian company and a foreign company incorporated in a jurisdiction notified by the Central Government is subject to which requirement?

The merger of a foreign company with an Indian company, or the reverse, requires the prior approval of the Reserve Bank of India under Section 234(2) of the Companies Act, 2013, subject to any other law in force.

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

Explanation

Section 234(2) provides 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 authorities named are not the approvals this provision prescribes.

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