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Approvals, Registrations and Authorizations Required for Organising an Indian Satellite tv for pc System and Provision of Satellite tv for pc Providers by Satellite tv for pc Operators in India
In my earlier articles on provision of satellite tv for pc providers in India, we analyzed the regulatory framework and the potential entry choices obtainable to international satellite tv for pc operators to ascertain its enterprise presence in India and supply satellite tv for pc providers within the Indian subcontinent. One of many entry possibility is organising an Indian Satellite tv for pc System (“ISS”) by the international satellite tv for pc operator for offering satellite tv for pc based mostly providers on a business foundation in India and be eligible for all of the preferential therapy accorded to such programs in service provisioning in India. For the needs of building an ISS, the international satellite tv for pc operator and/or home Indian firm, because the case could also be, (“Satellite tv for pc Firm”) would wish to acquire numerous approvals and registrations with the Indian regulatory authorities.
Incorporation of the Indian Firm
For the needs of organising of an ISS, Satellite tv for pc Firm would wish to include an organization (“Newco”) beneath Indian legal guidelines. Below the Corporations Act, 1956 of India, an organization restricted by shares could also be included both as a personal firm or as a public firm. Below tax and different statutes and rules, non-public and public corporations are ordinarily handled equally. Due to this fact, Satellite tv for pc Firm might think about incorporating Newco as a personal firm.
Registration with CAISS
Within the yr 1997-1998, the Authorities of India (“GoI”) introduced the Satellite tv for pc Communication Coverage Framework (“SatCom Coverage”) and formulated the norms, pointers, and process for registration of Indian satellite tv for pc programs by non-public Indian corporations and allowed restricted use of international satellites (i.e., uplink from India) in particular circumstances offered the satellites have been coordinated with the INSAT satellites. Pursuant to the SatCom Coverage, the GoI licensed Indian House Analysis Group (“ISRO”) to arrange a Committee for Authorizing the institution and operation of Indian Satellite tv for pc Techniques (“CAISS”), with its Secretariat on the Satellite tv for pc Communication Applications Workplace at ISRO Headquarters at Bangalore.
For the needs of registration with CAISS, Newco would wish to submit an in depth challenge proposal to CAISS stating particulars of its challenge together with the goals, goals and background of Newco together with its fairness construction; the satellite tv for pc proposed to be launched or leased, spacecraft description, manufacturing and launch particulars of the satellite tv for pc, capabilities of all payloads and system, community description and traits, orbit spectrum necessities, spacecraft launch car; information and site of satellite tv for pc launches proposed by Newco, and many others.
The Satellite tv for pc Coordination Programme Workplace, which serves because the Secretariat of CAISS, opinions and examines the appliance in mild of the SatCom Coverage and the norms and pointers and procedures accepted by the GoI. The Secretariat will, thereafter, put up the appliance for CAISS’ consideration.
By way of DoS’s Inside Guidelines for the approval course of, the applicant firm is required to supply its orbit-spectrum necessities with alternate decisions indicating precedence and the applicant firm will need to have an orbital slot previous to submitting an software to CAISS.
As soon as CAISS grants its approval for working the satellite tv for pc system, Newco might want to coordinate with Wi-fi Planning & Coordination Wing to provoke inter-system co-ordination and concern authorization to function the satellite tv for pc in accordance with the ITU Radio Laws. The GoI can also authorize Newco to immediately co-ordinate with different satellite tv for pc programs operators on technical facets. The ISS implementation standing would proceed to be monitored by CAISS.
International Funding Approval
GoI’s international direct funding (“FDI”) coverage in Indian corporations both by organising of wholly owned subsidiaries or joint ventures is regulated by the International Change Administration Act, 1999, and the International Change Administration (Switch or Challenge of Safety by an individual resident outdoors India) Laws, 2000 (“FDI Laws”). By way of the FDI Laws, FDI is allowed on an automated foundation in nearly all sectors besides the place the proposal (i) requires an industrial license; or (ii) falls outdoors notified sectoral coverage/caps or beneath sectors through which FDI isn’t permitted; and many others.
Proposals which don’t fulfill the parameters prescribed for automated approval, require prior approval from the International Funding Promotion Board (“FIPB”) which is a reliable physique functioning beneath the Division of Financial Affairs, Ministry of Finance, to contemplate and suggest FDI. The FIPB consists of members from the Division of Financial Affairs, Division for Industrial Coverage & Promotion, Division of Commerce, Ministry of Exterior Affairs, amongst others.
By way of the FDI Laws, an Indian firm can obtain international fairness funding upto 74 % to ascertain and function Indian satellite tv for pc programs topic to acquiring prior FIPB approval. As soon as FIBP approval is obtained, the Indian firm can immediately obtain funds via banks licensed to deal in international change and concern shares to international investor topic to submitting prescribed stories with the Reserve Financial institution of India (“RBI”) inside 30 days from receipt of the share consideration quantity and concern of shares to the international buyers.
Satellite tv for pc Firm might want to submit an in depth software with the FIPB for acquiring its approval for international funding. The applying would must be supported by paperwork together with the brochures and profiles of Satellite tv for pc Firm or its associates, marketing strategy/challenge report, memorandum and affiliation of articles of Newco (if Newco has already been included), and many others.
Submission of Report back to the RBI
As soon as Satellite tv for pc Firm obtains FIPB approval, Newco would wish to obtain funds from Satellite tv for pc Firm by means of inward remittances via banking channels and submit a report with the RBI with in 30 days from the receipt of the quantity of consideration.
Upon receipt of the funds, Newco can concern shares to Satellite tv for pc Firm and submit a report (within the prescribed kind) along with an acceptable certificates from the corporate secretary of Newco. The value of shares to be issued by Newco to Satellite tv for pc Firm would must be not lower than the truthful valuation of shares performed by a chartered accountant as per the rules issued by the erstwhile Controller of Capital Points.
Miscellaneous Licenses and Registrations
Newco would wish to acquire extra registrations and licenses together with a everlasting account quantity and tax deduction account quantity beneath the Earnings Tax Act, 1961, registration beneath the Outlets and Institutions Act, and commerce tax {and professional} tax registrations relying on the State through which Newco is registered/included. The working licenses for providers to be offered by the ISS (along with being a satellite tv for pc operator, if any), will must be obtained individually from the involved administrative departments just like the Division of Telecommunication for telecom providers and the Ministry of Data and Broadcasting for TV and radio broadcasting.
There’s presently just one ISS in India, which is Agrani (Zee Group/Dish TV enterprise). Agrani has nevertheless up to now not been capable of arrange a satellite tv for pc system regardless that it has entered right into a long run collaboration with ProtoStar I Ltd. for lease/buy of transponder capability. No different software is presently pending earlier than the CAISS for its consideration for organising an ISS.
My subsequent article on the topic will cope with the process and prices concerned for registration of Newco as an ISS with CAISS in India.
Seema Jhingan
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Source by Seema Jhingan
