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Home / RBI Compliance / Overseas Subsidiary (WOS) Compliance
Last updated: 2 October 2026
An Indian company with a wholly owned subsidiary or joint venture abroad has ongoing FEMA duties — annual performance reports, reporting of further investment and restructuring, and exit reporting. Expertvuw’s team keeps your overseas investment records and filings current.
Overseas direct investment by Indian entities is governed by the Foreign Exchange Management (Overseas Investment) Rules and Regulations, 2022 and RBI’s Overseas Investment Directions. Once an Indian entity has invested in a foreign entity — a wholly owned subsidiary (WOS) or joint venture — the reporting continues for as long as the investment is held.
Every year, an Annual Performance Report (APR) must be filed through the AD bank for each foreign entity, by 31 December, based on its audited accounts. Further financial commitments, loans, guarantees, restructuring and changes in shareholding must be reported in Form FC or other prescribed forms. Exit from the investment is reported as disinvestment.
The Indian entity must also file the annual FLA return, and its financial commitment must stay within the limits in the OI Rules, generally up to 400% of its net worth for the automatic route.
Basis: FEMA, 1999; Foreign Exchange Management (Overseas Investment) Rules, 2022; FEM (Overseas Investment) Regulations, 2022; RBI Master Direction – Overseas Investment. Last updated: 27 September 2026.
Due by 31 December every year for each foreign entity.
Generally up to 400% of the Indian entity's net worth under the automatic route.
Each overseas investment has a Unique Identification Number allotted through the AD bank.
Additional equity, loans and guarantees must be reported within prescribed time.
Delayed reporting can be regularised with a late submission fee within the permitted time.
Indian entities with overseas investment must file the annual FLA return.
Overseas subsidiaries are often forgotten until an AD bank query arrives.
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Overseas subsidiary compliance connects with these services.
Setting up a foreign subsidiary under the OI Rules.
Overseas direct investment reporting.
Annual FLA return.
Pricing of transactions with the subsidiary.
List all overseas entities and filings made.
Identify missing APRs and reports.
File pending reports with late fee where allowed.
Prepare and file APRs by 31 December.
Report new investments and changes.
File the annual FLA return.
Overseas investment reporting follows fixed dates.
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An Annual Performance Report filed through the AD bank for each foreign entity in which an Indian entity has invested, by 31 December each year.
Under the automatic route, generally up to 400% of the Indian entity’s net worth as per its last audited balance sheet.
Yes. Setting up or acquiring step-down subsidiaries must be reported as prescribed.
They can usually be filed with a late submission fee within the permitted period; otherwise compounding may be needed.
Current reporting under the 2022 framework uses Form FC, the APR and other prescribed forms.
ACS – Director, Expertvuw Management Pvt Ltd
FEMA filings are prepared by Expertvuw’s team. Certificates required by the AD bank or RBI are issued by independent practising professionals, and representation before RBI or the Directorate of Enforcement is made by authorised professionals or advocates.