What Is Overseas Direct Investment?
Overseas Direct Investment (ODI) is an investment by an Indian company, LLP or resident individual in the equity of an unlisted foreign company, or of 10% or more in a listed foreign company, or with control. It is governed by the FEMA overseas investment rules and regulations of 2022.
An Indian entity reports the financial commitment to its Authorised Dealer bank in Form FC and obtains a unique identification number for the foreign entity. Every year it then files an Annual Performance Report (APR) for each foreign entity, generally by 31 December, based on its audited accounts.
Your foreign investment, FEMA-compliant from day one
- Route and limits checked
- Form FC filed
- APR tracked every year
Who Needs ODI Filings?
- Indian companies setting up a subsidiary abroad
- Companies acquiring a stake in a foreign company
- LLPs and other entities investing overseas
- Resident individuals investing in an operating foreign company
Benefits
Legal outward remittance
Banks remit funds only with proper ODI documentation.
Avoid penalties
Late filings attract late submission fees or compounding.
Clean exit
Disinvestment and repatriation are smoother with clean records.
Ongoing compliance handled
APR and FLA return filed each year.
Documents Required
- Board resolution of the Indian entity
- Latest audited financial statements (net worth)
- Valuation report of the foreign entity, where required
- Documents of the foreign entity (incorporation, shareholding)
- KYC of the Indian entity and its directors
- Declarations required by the AD bank
ODI Process
Structure and route
We check eligibility, limits and whether approval is needed.
Valuation
Valuation obtained where the rules require it.
Form FC
Financial commitment reported through your AD bank.
Remittance
Funds sent and the unique identification number obtained.
Annual compliance
APR and FLA return filed every year.
Common Mistakes to Avoid
- Remitting before reporting – Follow the AD bank process before sending money abroad.
- Crossing limits – Financial commitment is limited with reference to net worth.
- Missing the APR – The APR is due every year for each foreign entity.
- Round-tripping structures – Structures that bring money back to India need careful review.
- Unreported changes – Changes in the foreign entity and disinvestment must also be reported.
Every Year After Investing
Annual Performance Report
Filed for each foreign entity, generally by 31 December.
FLA return
Report overseas assets to the RBI by 15 July.
Disinvestment
Report any sale or winding up of the foreign entity.
Transfer pricing
Price transactions with the foreign entity at arm’s length.
Why Choose Vaidam Consultancy for ODI Filing
FEMA experts
We handle RBI FIRMS filings and the supporting documents.
Clear quote upfront
You receive our fee and all charges before we begin.
On-time reporting
Filed within the RBI time limit to avoid late submission fees.
Bank coordination
We work with your AD bank until the form is approved.
Frequently Asked Questions
Form FC, filed through your AD bank, under the overseas investment rules of 2022.
The Annual Performance Report for each foreign entity, generally due by 31 December every year.
Financial commitment is limited with reference to the entity’s net worth under the automatic route; we check your limit.
Yes, within the Liberalised Remittance Scheme limit and subject to conditions, in an operating foreign company.
A late submission fee may apply, or the delay may need compounding.