Issuance of directions for reporting and regularization of partly paid units issued by Investment Vehicles

RBI had issued guidelines addressing the reporting and regularization of partly paid units issued by investment vehicles to persons resident outside India (PROI) vide Foreign Exchange Management (Non-debt Instruments) (Second Amendment) Rules, 2024 dated 14 March 2024.

It is to be noted that Foreign Exchange Management (Mode of Payment and Reporting of Non-Debt Instruments) Regulations, 2019 (Reporting Regulations) mandates reporting of units issued by an investment vehicle in Form InVI within 30 days on the Foreign Investment Reporting and Management System (FIRMS) portal. By virtue of the aforementioned amendment issued on 14 March 2025, the reporting compliance applicable on issuance of units by an investment vehicle to PROI would also be extended to the issuance of partly paid units. 

However, due to challenges faced in reporting issuances of partly paid units, RBI has issued a circular on 23 May 2025 (Circular) explicitly clarifying the reporting timeline in regard to such issuances of partly paid units wherein RBI has granted a one-time extension for reporting partly paid unit issuances made before the circular date. Investment vehicles can file Form InVI within 180 days from the circular’s issue without incurring late submission fees. Whereas issuance of partly paid units on or after the date of the Circular to be reported in Form InVI within 30 days, in accordance with the Reporting Regulations, as stated above.

Source: A.P. (DIR Series) Circular No. 06 dated 23 May 2025