Insights
Financial services
Notes on Indian law as it applies to financial services. The sector itself is described on its own page.
A show-cause notice from the Securities and Exchange Board of India opens a 60-day settlement window and, if penalty follows, a 45-day appeal
A show-cause notice from the Securities and Exchange Board of India (SEBI) can end in an adjudication order under section 15-I of the Securities and Exchange Board of India Act, 1992 (SEBI Act) or in a settlement.
A bank guarantee is paid on a compliant demand, and a court stops payment only for a clear case of fraud, irretrievable injustice or special equities
An unconditional bank guarantee is a contract between the issuing bank and the beneficiary, separate from the contract it secures, so a demand that follows its terms obliges the bank to pay without weighing the dispute behind it.
How a financial creditor starts insolvency against a company under section 7 of the Insolvency and Bankruptcy Code
A financial creditor starts corporate insolvency against a company by an application under section 7 of the Insolvency and Bankruptcy Code, 2016 before the National Company Law Tribunal, resting on a default of at least INR 1 crore and, for allottees of a real estate project or creditors in a class under section 21(6A)(a) or (b), on a joint application by the lesser of 100 creditors or 10 per cent of the class.
A borrower has 45 days to challenge a SARFAESI measure before the Debts Recovery Tribunal, and an appeal needs a deposit of at least 25 per cent of the debt
A borrower, guarantor or mortgagor who wants to contest a measure taken under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) has 45 days from the measure to apply to the Debts Recovery Tribunal (DRT) under section 17, and any appeal to the Debts Recovery Appellate Tribunal (DRAT) under section 18 is not entertained until the borrower deposits 50 per cent of the debt, a sum that can be reduced to 25 per cent but never waived.
A Canadian pension fund in Indian infrastructure: the income-tax exemption, and the treaty rates where it does not apply
Schedule V of the Income-tax Act, 2025 (Table, Sl.
What protects a Qatari investor in India: the 1999 treaty's ten-year tail, no new treaty yet, and the tax rules
No India-Qatar investment treaty is in force on the register of the Department of Economic Affairs (DEA), which records the 1999 treaty as terminated on 23 March 2017 and lists no later Qatar entry.
A United States company investing in India: entry under the foreign exchange rules, no investment treaty, and dividend tax under the 1989 convention
A United States company may subscribe to shares of an Indian company under the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 without prior approval where the sector is on the automatic route and the sectoral cap is not crossed, at a price not below the fair value of the shares, and the Indian company must report the issue to the Reserve Bank of India in Form FC-GPR (Foreign Currency-Gross Provisional Return) not later than thirty days from the date of issue.
The threshold for a material related party transaction now rises with the size of the listed entity
From 19 December 2025 a related party transaction of a listed entity is material, and needs the prior approval of shareholders, only above a threshold that rises with the entity's annual consolidated turnover.
The two-factor rule for a domestic digital payment now runs under one set of Directions, with one factor dynamic and the issuer bearing any loss on a payment that does not comply
The Reserve Bank of India (Authentication mechanisms for digital payment transactions) Directions, 2025, issued on 25 September 2025, required every payment system provider and participant, bank or non-bank, to comply by 1 April 2026.
The SARFAESI clock in 2026: what each stage of enforcement costs while it runs
On an illustrative INR 25 crore non-performing exposure, a month of drift anywhere in the SARFAESI sequence costs about INR 38 lakh, roughly 1.5 per cent of the outstanding, and most of it is destroyed rather than transferred.
A deepfake of your chief executive runs on a seven day clock, unless you hold a court order
The February 2026 amendment to the Information Technology Rules is reported as a three hour takedown rule.
Half the new insolvency law is in force, and the half everyone talked about is not
The Insolvency and Bankruptcy Code (Amendment) Act, 2026 received assent on 6 April 2026, and most of it commenced on 26 May 2026.
An alternative investment fund may now offer co-investment through its own scheme, capped at three times the investor's contribution to the fund's investment in that company
Since 9 September 2025 a Category I or Category II alternative investment fund (AIF) may offer its accredited investors a co-investment in a portfolio company through a separate co-investment scheme of the fund itself, and no longer only through a co-investment portfolio manager.
The 15 Per Cent Shareholder: What a Company Petition Is Actually Worth
A minority shareholder who petitions the NCLT under section 241 and wins a buyout order still has to survive the arithmetic.
An AI vendor's indemnity moves the money, not the responsibility: contracts, diligence and disclosure
Contracts for AI tools are usually drafted as if a warranty and an indemnity settle who answers for the tool.
AI and patents, trade secrets and training data in India
Where Indian law stands on patenting AI, naming an AI as inventor, protecting models as trade secrets, and using copyright works as training data.
An FPI must disclose its owners down to natural persons if over half its Indian equity sits in one group or it holds over INR 50,000 crore
A foreign portfolio investor (FPI) that holds more than 50 per cent of its Indian equity assets under management (AUM) in one Indian corporate group, or more than INR 50,000 crore of Indian equity AUM alone or with its investor group, must give its designated depository participant (DDP) the name of every person with any ownership, economic interest or control in it, down to natural persons.
There is no AI statute in India, and the one AI rule that binds you today is about labels
A business buying or building AI in India is usually told it faces a new compliance regime.
Investing into India through Mauritius or Singapore in October 2026: the treaty tests, the GAAR and Tiger Global
Under the India-Mauritius and India-Singapore double taxation avoidance agreements (DTAAs) as amended in 2016, gains on Indian shares acquired on or after 1 April 2017 may be taxed in India, while shares acquired before that date stay taxable only in the investor's State of residence, subject in Singapore to a limitation of benefits clause.
Dutch holding companies investing into India: the MFN clause, the Nestle judgment and dividend withholding
On 19 October 2023 the Supreme Court of India held, in Assessing Officer (International Taxation) v. Nestle SA, that a most-favoured-nation (MFN) clause in a protocol to an Indian double taxation avoidance agreement (DTAA) does not operate by itself: the better rate given to a later treaty partner reaches residents of the first country only when the Central Government notifies it under section 90 of the Income-tax Act, 1961, and the later partner must have belonged to the Organisation for Economic Co-operation and Development (OECD) when its treaty with India was entered into.
Three clocks run under Regulation 30, and the shortest one starts when the board meeting closes
Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is usually read as a list of events.
A commercial bank can classify a wilful defaulter only through two committees, a 21 day notice and a 15 day representation, and a compromise lifts the label only when it is paid in full
Under the Reserve Bank of India (Commercial Banks, Treatment of Wilful Defaulters and Large Defaulters) Directions, 2025, a commercial bank can label a borrower a wilful defaulter only through two committees and two written windows, 21 days for the borrower's reply to a show cause notice and 15 days for a representation to the review committee, and where the account was screened as a wilful default case at the outset, the whole process has to finish within six months of the loan becoming a non-performing asset (NPA).
Digital lending is now one instrument, and a default loss guarantee cannot exceed five per cent of what the portfolio disbursed
The Reserve Bank of India (Digital Lending) Directions, 2025 took three circulars written over five years and replaced them with one, and in doing so moved the default loss guarantee out of a standalone 2023 circular and into a chapter of the regime it always belonged to.
What the India-UAE Bilateral Investment Treaty protects for a UAE investor in India, and what it leaves out
The India-United Arab Emirates (UAE) Bilateral Investment Treaty (BIT), signed at Abu Dhabi on 13 February 2024 and in force from 31 August 2024, protects a UAE investor's enterprise-based investment in India against denial of justice, fundamental breach of due process, targeted discrimination, manifestly abusive treatment and uncompensated expropriation.
What the India-Singapore CECA investment chapter protects for a Singapore investor, and what it leaves out
The investment chapter of the India-Singapore Comprehensive Economic Cooperation Agreement (CECA), signed at New Delhi on 29 June 2005 and in force from 1 August 2005, gives a Singapore investor in India national treatment, protection against expropriation without prompt, adequate and effective compensation, free transfer of returns, and a right to take most disputes to arbitration after six months of consultations.
A Put Option Against a Resident: What Makes It Enforceable, and at What Price
A put option given by an Indian promoter to a foreign fund is enforceable in India, and has been since 2013, but it survives three separate tests rather than one.
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