Fund · Startups
How is foreign investment in a startup reported to the RBI?
How foreign investment is reported to the Reserve Bank of India, the forms involved and the cost of filing late.
A company receiving foreign investment reports it to the Reserve Bank of India through the Foreign Investment Reporting and Management System. Form FC-GPR reports the allotment of shares to a foreign investor, and Form FC-TRS reports a transfer of shares between a resident and a non-resident. Both filings carry a statutory time limit measured from the relevant event. A late filing generally attracts a late submission fee under the framework the Reserve Bank of India administers, and continued non-filing can need formal compounding.
The statutory positions on this page were reviewed by Lalit Mohan Tyagi, FCA on 26 August 2026. They describe the general position and not every provision that may apply to a particular case. Confirm your own position with the firm before you act on it.
What is FEMA reporting, and why does it apply to a funding round?
The Foreign Exchange Management Act, 1999 requires certain inbound transactions involving a person resident outside India to be reported to the Reserve Bank of India.
A funding round that includes a foreign investor triggers this reporting requirement, in addition to the company law filings the round already needs.
Reporting is separate from, and in addition to, income tax compliance for the same transaction.
What does Form FC-GPR report, and when is it filed?
Form FC-GPR reports the allotment of equity shares, or another eligible capital instrument, to a person resident outside India.
It is filed after the shares are actually allotted, within the statutory time limit measured from the date of allotment.
The filing includes a valuation certificate and other supporting documents for the round.
What does Form FC-TRS report, and when is it filed?
Form FC-TRS reports the transfer of capital instruments between a resident and a person resident outside India, in either direction.
It is filed within the statutory time limit measured from the relevant transfer or payment event.
It applies to a secondary sale of existing shares, as distinct from a fresh allotment reported under FC-GPR.
What is the Foreign Investment Reporting and Management System?
The Foreign Investment Reporting and Management System, generally referred to as FIRMS, is the online portal the Reserve Bank of India maintains for these filings.
Both FC-GPR and FC-TRS are filed electronically through this portal, along with the supporting documents each form requires.
An authorised dealer bank is generally involved in the filing chain, since FIRMS filings route through the reporting bank.
What happens if a filing is made after the deadline?
A filing made after the statutory time limit generally attracts a late submission fee, calculated under a framework the Reserve Bank of India has put in place for this purpose.
The fee is calculated with reference to the amount of the transaction and the length of the delay.
Paying the late submission fee regularises straightforward delays without a separate compounding application in many cases.
What is compounding, and when does a company need it?
Compounding is a formal process under FEMA for regularising a contravention that is not covered by the late submission fee framework.
It generally applies to a more serious or longer-standing lapse, such as a transaction reported very late or not reported at all.
An application for compounding is made to the Reserve Bank of India, which levies a compounding amount after considering the facts.
Does every category of foreign investor follow the same reporting route?
Most equity investment from a person resident outside India follows the FC-GPR or FC-TRS route described above.
Certain categories of investor, or certain sectors, can carry additional or different reporting requirements under FEMA.
The correct route for a particular investor should be confirmed before the round closes, not after.
What records should a founder keep for FEMA reporting?
The valuation certificate, the share subscription agreement, the bank realisation certificate for the funds received, and the FIRMS acknowledgement are the core records for a round.
These records support the filing itself and are also needed if the transaction is reviewed later.
Keeping them filed against each round makes a later transfer or exit easier to document.
Statutory basis
| Position | Rests on | Stated as at | Status |
|---|---|---|---|
| Form FC-GPR must be filed within a statutory time limit measured from the date of allotment of shares to a person resident outside India. | FEMA (Non-Debt Instruments) Rules, 2019, read with the RBI Master Direction on Reporting under FEMA, 1999 | August 2026 | Verified |
| Form FC-TRS must be filed within a statutory time limit measured from the relevant transfer or payment event. | RBI Master Direction on Reporting under FEMA, 1999 | August 2026 | Verified |
| FC-GPR and FC-TRS are filed electronically through the Foreign Investment Reporting and Management System portal maintained by the Reserve Bank of India. | RBI FIRMS portal and related circulars | August 2026 | Verified |
| A FEMA reporting filing made after its statutory time limit generally attracts a late submission fee calculated under the framework the Reserve Bank of India administers for this purpose. | RBI Master Direction and the late submission fee framework under FEMA, 1999 | August 2026 | Verified |
| A FEMA contravention not covered by the late submission fee framework can be regularised through compounding, applied for with the Reserve Bank of India. | Foreign Exchange Management Act, 1999, section 15, and RBI compounding guidelines | August 2026 | Verified |
Who is responsible for filing FC-GPR, the company or the investor?
The Indian company receiving the investment is responsible for filing FC-GPR after allotment.
Does FC-TRS apply to a transfer between two non-resident investors?
FC-TRS is generally used where at least one party to the transfer is a person resident outside India and the other is a resident; the correct route should be confirmed for other combinations.
Is there a way to file late without going through compounding?
The late submission fee framework covers many straightforward delays without a separate compounding application, though not every case qualifies.
Does FEMA reporting apply to funding from a non-resident Indian?
Investment from a non-resident Indian is generally treated as investment from a person resident outside India, and the same reporting route applies.
Does an allotment of convertible instruments need its own FEMA filing?
Yes, generally. Convertible instruments allotted to a person resident outside India are separately reported, described further on the convertible instruments page.
Related pages in this section
Last reviewed 26 August 2026.