Cross-Border Tax Structuring & DTAA Advisory: Timelines and What Drives Them
How long Cross-Border Tax Structuring & DTAA Advisory takes depends on a handful of things that are largely within your control. The questions below are the ones raised most often in practice; the full scope of the service is on the Cross-Border Tax Structuring & DTAA Advisory page.
What is the FC-GPR and when must it be filed?
FC-GPR (Foreign Currency — Gross Provisional Return) is an RBI filing that must be made on the FIRMS portal within 30 days of the date of issue of equity shares, CCPS, or other FDI-eligible instruments by an Indian company to a person resident outside India. The FC-GPR reports the details of the foreign investment received: the name and country of the foreign investor, the amount received, the number and class of shares issued, the price per share, the valuation basis, and the sector. A Company Secretary certificate and, where applicable, a valuation certificate from a Chartered Accountant or SEBI-registered merchant banker must accompany the filing. Subsequent equity transfers between residents and non-residents are reported on FC-TRS (Foreign Currency — Transfer of Shares).
In practice: FC-GPR is time-bound. Missing the 30-day window requires an application for compounding under FEMA — the compounding process involves a formal application, a hearing, and a compounding amount (penalty) proportional to the investment amount and the delay period. We file FC-GPR as a standard part of every engagement involving foreign equity investment into an Indian entity, initiating it immediately after share allotment.
What is FC-TRS and when is it required?
FC-TRS (Foreign Currency — Transfer of Shares) is an RBI filing required when shares of an Indian company are transferred between a person resident in India and a person resident outside India — in either direction (Indian selling to foreign buyer, or foreign shareholder selling to Indian buyer). The FC-TRS must be filed within 60 days of the transfer of shares. The reporting requirement applies to both primary and secondary transactions — any change in the FDI register resulting from a transfer must be reported. The filing includes details of the transferor, the transferee, the number and class of shares, the transfer price, and the valuation basis (as required by FEMA's pricing guidelines).
In practice: FC-TRS is triggered in every cross-border M&A, every PE/VC secondary sale, and every founder buyout where a foreign shareholder exits. The 60-day window runs from the earlier of the transfer of the shares and the receipt or remittance of funds — not from the date of the SPA or agreement. Missing FC-TRS requires FEMA compounding, which adds cost and delay to already complex transactions.
What are the reporting obligations when a foreign company acquires shares of an Indian company (FDI)?
When an Indian company issues shares to a foreign investor under the FDI route, the following reporting sequence applies: (a) FC-GPR filed on FIRMS portal within 30 days of share allotment; (b) FLA return filed by 15 July of the following year, covering the FDI received; (c) if the investment is in a regulated sector, prior approval from the relevant sectoral regulator may be required before or after the investment; (d) the company must also report any subsequent changes in the foreign ownership (through FC-TRS on transfers, or further FC-GPRs on fresh allotments).
In practice: The FDI reporting framework is managed entirely through the FIRMS (Foreign Investment Reporting and Management System) portal. Access to FIRMS requires registration by the Indian entity. We manage FIRMS registration and all subsequent FDI filings as a standard part of our inbound investment advisory service.
Can a foreign company set up operations in India through a wholly-owned subsidiary in all sectors?
In most sectors, a foreign company can set up a 100% wholly-owned subsidiary in India through the automatic route — without prior government approval. However, certain sectors are subject to FDI caps, conditions, or require government approval: insurance (up to 100% FDI following the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Act 2025, with conditions), banking — private (74% FDI cap), defence (74% automatic route, above 74% government route), broadcasting (26% to 100% depending on the segment), print media (26% FDI cap), multi-brand retail trading (51% cap, with conditions), and a few others. Some sectors prohibit FDI entirely: atomic energy, lottery, gambling, betting, chit funds. The DPIIT FDI Policy document (updated periodically) is the definitive reference — the caps and conditions change from time to time.
In practice: FDI policy in India has been progressively liberalised over the years, and many sectors that previously required government approval have moved to the automatic route. However, conditions attached to the automatic route in regulated sectors (insurance, telecom, banking) can be detailed and non-obvious. We always check the current DPIIT FDI Policy and the RBI Master Direction before advising on any sector-specific inbound investment.
How long does it typically take to set up a cross-border structure for India-UAE?
A straightforward India-UAE structure for a new business — incorporating both an Indian Private Limited Company and a UAE Free Zone entity, completing all FEMA filings, and establishing initial intercompany agreements — has a timeline that depends on the authority and the case; confirm the current processing time. The India incorporation and the UAE free zone entity each run to their own processing times. FEMA filings (ODI registration or FC-GPR, depending on the direction of investment) are completed concurrently. Intercompany agreements are drafted in parallel. A more complex restructuring of an existing group — with multiple entities, historical compliance gaps, and significant transfer pricing issues — takes longer and must be scoped project by project.
In practice: Timeline is heavily influenced by the speed of document collection from the client. Bank account opening for the UAE entity is often the longest-lead item — particularly if the bank requires extended KYC for Indian-connected entities. We advise clients to initiate bank account opening early and in parallel with other setup activities.
Where this sits in the wider engagement
Cross-Border Tax Structuring & DTAA Advisory rarely arrives on its own. The statutory basis and the current requirements are set out on the Cross-Border Tax Structuring & DTAA Advisory service page, and the related services are grouped under Business Setup.
What PNPC does
PNPC Global has practised since 1986 across India and the UAE. On Cross-Border Tax Structuring & DTAA Advisory we take the work end to end — reviewing the facts, preparing and filing what is required, and dealing with the authority through to closure.