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Department for Promotion of Industry and Internal Trade (DPIIT) – FDI Policy, 2020

November 06, 2020

Department for Promotion of Industry and Internal Trade, Ministry of Commerce and Industry Government of India (DPIIT) – FDI Policy, 2020

The Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce and Industry, Government of India has released the Consolidated Foreign Direct Investment Policy 2020 on 29th October, 2020 after August 28, 2017.

The consolidated FDI policy is a compilation of various policy decisions taken by the government with regard to FDI in various sectors. The said circular is effective from October 15, 2020. The new policy includes the April 2020 circular concerning the prior approval requirement for a foreign investment originating from countries sharing land border with India (including China) to prevent opportunistic takeovers of firms whose operations and finances may have suffered during the lockdowns and due to the general impact of the COVID-19 pandemic.

The new FDI policy also details the recent changes made by the DPIIT vide its press Note 2 of 2018 in regulating foreign investment in e-commerce in India, which includes the following:

• Prohibiting an entity related by equity to the e-commerce platform from doing business on the website portal;

• Prohibition on exclusive product launches

• Restricting vendors from buying more than 25% of their inventory from the platform and its group companies; and

In respect of start-ups, the FDI Policy also incorporates the already introduced clarification that for sectors under automatic route, issue of equity shares against import of capital goods/ machinery/ equipment (excluding second-hand machinery) and pre- operative/pre-incorporation expenses is permitted under automatic route.

The government of India has in the recent past, liberalized the FDI policy in several sectors such as coal mining, contract manufacturing and single brand retail trade, including digital news wherein a 26% cap on equity / FDI has been notified in the segment that covers uploading or streaming of news and current affairs through digital media, which also requires government approval. This brings it at par with the investment cap on newspaper and periodical publications and the publication of Indian editions of foreign magazines dealing with news and current affairs, which are also subject to the government approval route.

This policy supersedes all circulars/press notes/press releases issued by the DPIIT in the past.

The complete text of the FDI Policy can be viewed at below link:

https://dipp.gov.in/sites/default/files/FDI-PolicyCircular-2020-29October2020.pdf

Arbitration Law

The Arbitration and Conciliation (Amendment) Ordinance, 2020 (Dated November 4, 2020)

Section Existing Law Amended Law
Section-36 (1) Where the time for making an application to set aside the arbitral award under section 34 has expired, then, subject to the provisions of sub-section (2), such award shall be enforced in accordance with the provisions of the Code of Civil Procedure, 1908, in the same manner as if it were a decree of the court.   (2) Where an application to set aside the arbitral award has been filed in the Court under section 34, the filing of such an application shall not by itself render that award unenforceable, unless the Court grants an order of stay of the operation of the said arbitral award in accordance with the provisions of sub-section (3), on a separate application made for that purpose.   (3) Upon filing of an application under sub-section (2) for stay of the operation of the arbitral award, the Court may, subject to such conditions as it may deem fit, grant stay of the operation of such award for reasons to be recorded in writing:   Provided that the Court shall, while considering the application for grant of stay in the case of an arbitral award for payment of money, have due regard to the provisions for grant of stay of a money decree under the provisions of the Code of Civil Procedure, 1908   (1) Where the time for making an application to set aside the arbitral award under section 34 has expired, then, subject to the provisions of sub-section (2), such award shall be enforced in accordance with the provisions of the Code of Civil Procedure, 1908, in the same manner as if it were a decree of the court.   (2) Where an application to set aside the arbitral award has been filed in the Court under section 34, the filing of such an application shall not by itself render that award unenforceable, unless the Court grants an order of stay of the operation of the said arbitral award in accordance with the provisions of sub-section (3), on a separate application made for that purpose.   (3) Upon filing of an application under sub-section (2) for stay of the operation of the arbitral award, the Court may, subject to such conditions as it may deem fit, grant stay of the operation of such award for reasons to be recorded in writing:   Provided that the Court shall, while considering the application for grant of stay in the case of an arbitral award for payment of money, have due regard to the provisions for grant of stay of a money decree under the provisions of the Code of Civil Procedure, 1908   “Provided further that where the Court is satisfied that a prima facie case is made out,-— (a) that the arbitration agreement or contract which is the basis of the award; or (b) the making of the award, was induced or effected by fraud or corruption, it shall stay the award unconditionally pending disposal of the challenge under section 34 to the award.”. Explanation.— For the removal of doubts, it is hereby clarified that the above proviso shall apply to all court cases arising out of or in relation to arbitral proceedings, irrespective of whether the arbitral or court proceedings were commenced prior to or after the commencement of the Arbitration and Conciliation (Amendment) Act, 2015. The Above Amendment shall be deemed to have been inserted with effect from 23rd day of October, 2015
Section 43J The qualifications, experience and norms for accreditation of arbitrators shall be such as specified in the Eighth Schedule:   Provided that the Central Government may, after consultation with the Council, by notification in the Official Gazette, amend the Eighth Schedule and thereupon, the Eighth Schedule shall be deemed to have been amended accordingly.   The qualifications, experience and norms for accreditation of arbitrators shall be such as may be specified by the regulations.”

The complete text of the ordinance may be viewed at below link:

http://www.egazette.nic.in/WriteReadData/2020/222941.pdf

Last updated on: 05/11/2020

Article contributed by:

Munesh Gaur Senior Associate- Legal MBG Corporate Services


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