Exit, Disinvestment and Repatriation Advisory for Overseas Investments
Unwinding overseas investments correctly is as important as setting them up — FEMA-compliant exit documentation, RBI reporting and repatriation support.
Part of our Global Expansion advisory. For the underlying FEMA framework, read our ODI Compliance Guide for Indian Companies.
When Indian Companies Exit Overseas
- Sale of the overseas JV/WOS to a third party.
- Liquidation or voluntary winding up of the overseas entity.
- Internal restructuring or consolidation of overseas operations.
- Strategic exit from non-core geographies or businesses.
FEMA / RBI Exit Compliance
- Form ODI Part III filing for disinvestment / closure.
- Valuation report from a SEBI-registered Category I Merchant Banker / CA.
- APR up to date through the year of exit.
- Reporting of write-offs, residual receivables and any deferred consideration.
Our Support Scope
- Exit structure review — sale, liquidation or merger optionality.
- Form ODI closure documentation and AD-bank coordination.
- Valuation for exit consideration and tax-efficient repatriation planning.
- Repatriation documentation including FIRC and remittance reporting.
Exiting an overseas investment
An Indian investor exits an overseas entity by selling its stake, through a buy-back or capital reduction, by merging the entity, or by winding it up. Under the overseas investment regime, each route is a disinvestment that must be reported, and the sale proceeds must be repatriated to India within the prescribed time.
What to check before exit
- Reporting up to date: all APRs and earlier filings should be current, because pending delays can block the disinvestment until regularised.
- Pricing: the sale price should be supported by a valuation, particularly for transfers to related parties.
- Write-offs: where the investment is sold at a loss or written off, the rules set conditions for when this is allowed under the automatic route.
- Step-down entities: exits at a lower layer of the structure also need reporting.
- Dues: loans, guarantees and receivables from the overseas entity should be settled or reported as part of the exit.
Figures and timelines above reflect our understanding at the time of writing; confirm against the latest Act, Rules and notifications before relying on them.
Tax on the exit
The capital gain or loss on sale of shares of a foreign company is taxed in India, with credit for foreign tax under the relevant tax treaty where available. Liquidation proceeds, dividends and the repayment of loans have different tax treatments, so the order of steps matters. In the foreign country, local exit taxes or stamp duties may also apply.
For ongoing reporting, see ODI compliance and APR filing. For repatriation of profits from Indian companies to foreign shareholders, see repatriating profits from India.
Practical questions
Can we leave the money abroad after the sale?
Generally no. Disinvestment proceeds are expected to be repatriated within the prescribed period, unless reinvestment is permitted under the rules.
Exit Overseas Investments the Right Way
FEMA-compliant documentation, valuation and repatriation support — end to end.