The sale and call options are rights that allow shareholders to force the sale and purchase of shares in the joint venture. An option to sell the right holder allows the right holder to sell its shares to the other party if the other party is required to acquire the proposed shares. An appeal option that is quite the opposite of a put option allows the right holder to ask another shareholder to sell his shares to the right holder. However, with regard to the existing FDI Directive and the RBI notification with regard to the price directives for instruments with optional clauses, these rights can only be exercised after the completion of a minimum one-year suspension period or in accordance with the FDI Directive, depending on the highest value from the date of award of these shares. , depending on the periods of sectoral deadlock. The foreign investor is entitled to exercise this option or right without guaranteed return and at a price that prevails either at the time of exit or at another method of valuation, as provided by the pricing or valuation policy published from time to time by the RBI. Under the Companies Act, all transactions of the joint venture with related persons must be authorized by the board of directors and, in certain circumstances, by the shareholders of the joint venture, unless these transactions are carried out in the context of the ordinary activity of the company and are carried out throughout the company. In addition, the related shareholder cannot vote on such a transaction. However, the above condition does not apply to a joint venture where 90% or more members are family members of promoters or related parties. In addition, the obligation to seize a shareholder decision in transactions between the holding company and its 100% subsidiary whose accounts are consolidated with that holding company and subject to shareholder approval at a general meeting will be removed. An arm-length transaction refers to a transaction between two related parties that is carried out as if it had nothing to do with each other, so that there is no conflict of interest and is in compliance with the TP rules. The partners of the joint venture may withdraw from the joint venture by transferring the securities they held to the joint venture, the taxable proceeds being payable by the joint venture partners at the following rates: Although a joint venture, in the form of a registered company, is the most popular right among foreign investors in India.
, there are also other types of JWs: the Make in India initiative, one of the government`s many flagship programs to promote direct investment and joint ventures in India, is now helping to make India an attractive destination for directly di. ANTS Policy Committee The initiative, together with the easing of DL restrictions, has therefore led to numerous joint ventures, particularly in the defence and pharmacy sectors, and has made investments by players such as neopharma, based in the United Arab Emirates, Rafael Advanced Defence Systems and Elbit Systems in Israel, as well as japans ASKA Pharmaceuticals and Astra Microwave Products. Manufacturing, one of the main pillars of the Make in India initiative, is witnessing the current and planned investments of manufacturing giants such as GE, Siemens, HTC, Toshiba and Boeing. On the other hand, the Indian joint venture agreement may also provide for the termination of its activities as well as the liquidation and closure of the business. Each of these options can be used independently or in combination. At the time of the conclusion of a joint venture, Indian developers tend to “open the window” of the business plan or assets and carefully manage the diligence of the new joint venture partner. In such cases, the new partner of the joint venture is not informed of all outstanding issues concerning the entity or asset concerned.