ODI Filing — Overseas Direct Investment Reporting under FEMA
When an Indian company, LLP or resident individual invests in a business abroad, the investment must be reported to RBI through your AD bank under the Overseas Investment Rules, Regulations and Directions, 2022. Form FC comes first and the Annual Performance Report is due every 31 December. Late filings cost a fee and block new investments until fixed.
What it is
Overseas Direct Investment (ODI) is an Indian resident’s investment in a foreign business with a lasting interest. It covers buying unlisted shares of a foreign company, subscribing at its incorporation and taking 10% or more of a listed foreign company. It also covers holding less than 10% with control, such as the right to appoint a majority of directors. A smaller stake in a listed company without control is Overseas Portfolio Investment (OPI) instead.
Three instruments notified on 22 August 2022 govern ODI: the Foreign Exchange Management (Overseas Investment) Rules, 2022, the Overseas Investment Regulations, 2022 (FEMA 400/2022-RB) and RBI’s Overseas Investment Directions, 2022. ODI filing means the forms you submit through your Authorised Dealer (AD) bank to RBI, starting with Form FC and continuing every year with the Annual Performance Report.
Who it applies to
You are a company or LLP going abroad
Say a Faridabad auto-parts maker opens a sales subsidiary in Dubai to service Gulf buyers. That is ODI. So is buying into a foreign business or forming a joint venture abroad, up to 400% of net worth under the automatic route.
You are investing personally
Individuals can make ODI only within the Liberalised Remittance Scheme limit of USD 2,50,000 per financial year, and the same reporting applies.
You already hold ODI
The APR is due every year. Restructuring is reported. A sale is reported within 30 days. A US subsidiary set up years ago and since gone quiet still needs its APR.
Why it matters
Let your bank release the remittance
The AD bank files Form FC with RBI and a Unique Identification Number (UIN) is generated. Later remittances to the same entity are tracked against it.
Keep the door open for the next deal
If any reporting under the 2022 framework is overdue, you cannot make a further financial commitment abroad until the delay is regularised.
Exit without surprises
When you sell or wind up, the disinvestment is reported within 30 days. In practice, this is where old gaps in APRs come to light, just when you want the money home.
Documents required
From the Indian investor
- Board resolution approving the investment
- Last audited balance sheet, not older than 18 months
- A net worth certificate from a practising CA to test the 400% limit
- Declaration that you are not a wilful defaulter or under investigation
About the foreign entity
- Incorporation documents and shareholding
- Business activity and country
- Share purchase or joint venture agreement
- Valuation report where shares are acquired
After the investment
- Proof of investment, such as the share certificate, within 6 months
- Audited accounts of the foreign entity for the APR
- Details of any step-down subsidiaries
ODI reporting at a glance
| Form | When | What it covers |
|---|---|---|
| Form FC | Before or at the time of the financial commitment | The investment, loan or guarantee; UIN generated |
| Annual Performance Report (APR) | By 31 December every year | Each foreign entity’s performance, based on its accounts |
| Event-based reports | Within 30 days of the event | Restructuring, or changes in holding, name or activity |
| Disinvestment (Form FC) | Within 30 days of the sale | Full or part exit |
| FLA return | By 15 July | Foreign assets and liabilities, on the FLAIR portal |
Here is the catch most first-time investors miss. The financial commitment arises when you sign a binding agreement, not when money leaves India. Guarantees also count from the day they are issued, not when they are invoked.
How it works
Test the deal against the limits
We check that the activity is permitted, that you are eligible, and that your total commitment stays within 400% of net worth. Real estate trading, gambling and financial products linked to the Indian rupee are off limits.
Get the valuation and approvals
For an acquisition of shares, we coordinate the valuation report, which a registered valuer or Category I merchant banker signs, and draft the board resolution.
File Form FC through the AD bank
We prepare Form FC and the supporting set for your bank. Once RBI generates the UIN, the remittance goes through.
Collect proof of investment
We follow up for the share certificate or other evidence and submit it within 6 months.
File the APR and event reports
Every year we prepare the APR by 31 December. Restructurings and exits go in within 30 days, alongside your wider FEMA compliance.
Timelines
File Form FC before you commit
File through the AD bank before, or at the time of, the financial commitment or first remittance.
File the APR by 31 December
One APR per foreign entity every year by 31 December, based on its latest accounts. Dormant entities still file.
Report an exit within 30 days
Disinvestment is reported within 30 days, and sale proceeds are repatriated within 90 days.
What happens if you file late
Late Submission Fee
Delays of up to three years can be regularised with an LSF of ₹7,500 plus 0.025% of the amount for each year of delay. A late APR or FLA attracts a flat ₹7,500.
No new investments until fixed
While any reporting is overdue, you cannot make a further financial commitment until the delay is regularised.
Penalty under FEMA Section 13
Beyond the LSF route, a contravention can attract a penalty of up to three times the sum involved. Where the sum cannot be quantified, the cap is ₹2 lakh, plus up to ₹5,000 a day if it continues.
Frequently asked questions
What is the difference between ODI and OPI?
ODI is a lasting investment with influence; OPI is a portfolio holding. Buying unlisted foreign shares, subscribing at incorporation, taking 10% or more of a listed foreign company, or holding under 10% with control all count as ODI. A stake below 10% in a listed company without control is OPI. The reporting differs, so we classify each investment before anything is filed, and you report on the right form.
How much can an Indian company invest abroad under the automatic route?
Up to 400% of its net worth, based on the last audited balance sheet, which must not be older than 18 months. The limit covers the total financial commitment: equity, loans, guarantees and pledges or charges on Indian assets for the foreign entity. Going beyond 400% needs prior RBI approval. We calculate the headroom before you sign, so the deal stays within the automatic route.
Can a resident individual make ODI?
Yes, but only within the Liberalised Remittance Scheme limit of USD 2,50,000 per financial year. That limit is shared with all your other LRS remittances in the year. The individual files the same Form FC through the AD bank and an APR every year by 31 December. Planning the remittance across two financial years can help with a larger deal. We map the numbers with you first.
When is Form FC filed?
Before, or at the time of, making the financial commitment, through your AD bank. A financial commitment arises when you sign a binding agreement, not only when money is sent. Once filed, RBI generates a Unique Identification Number for the foreign entity. Later remittances, loans or guarantees to it are reported against that UIN. File before signing day and your bank has time to clear the paperwork.
What is the APR and when is it due?
The Annual Performance Report is a yearly return for each foreign entity in which you hold ODI, due by 31 December. It reports the entity’s financial performance and your holding, based on its accounts, and covers step-down subsidiaries too. Even a dormant foreign entity must file. A late APR attracts an LSF of ₹7,500. We collect the accounts early in the year so it is filed well before December.
What if we have missed ODI filings in earlier years?
You can usually regularise them by paying a Late Submission Fee, if the delay is within three years of the due date. The fee is ₹7,500 plus 0.025% of the amount involved for each year of delay, or a flat ₹7,500 for the APR. Until the delays are regularised, no further ODI is allowed. Beyond three years, the delay is dealt with under FEMA proceedings instead. We prepare the whole backlog and file it together.
Which overseas activities are not allowed?
Real estate trading, gambling in any form, and financial products linked to the Indian rupee without RBI approval are not allowed under the 2022 framework. There is also a limit on structures that route money back into India through more than two layers of subsidiaries. If your plan touches any of these, we flag it before you commit, while there is still time to restructure.
How do we report selling our overseas stake?
Report the disinvestment through your AD bank within 30 days of the sale, and bring the proceeds back to India within 90 days. Any pending APRs or other filings should be cleared first, or the bank may hold the exit. Valuation support may be needed for the sale price. We line up the paperwork before the sale agreement is signed, so the exit closes cleanly.
What it costs
Our fee plus the government fee that applies to your case, quoted before you commit. Tell us the situation and we will price it exactly.
Late filings within three years attract the LSF: ₹7,500 plus 0.025% of the amount for each year of delay, or ₹7,500 flat for an APR or FLA return.
Ready to begin?
Tell us where you are investing and how much, and we will have your Form FC ready before the money moves.