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Article
Widening the gate of Indian Economy: Key changes under the Foreign Exchange Management (Non-Debt Instruments) (Third Amendment) Rules, 2026
By Aman Gupta
The Ministry of Finance (Department of Economic Affairs) recently notified the Foreign Exchange Management (Non-Debt Instruments) (Third Amendment) Rules, 2026 amending the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019, which further liberalises foreign investment into India’s listed securities market. The amendments expand eligibility under Schedule III from only NRIs and OCIs to all individual persons resident outside India, subject to individual and aggregate investment limits. They also clarify the applicability of land-border investment restrictions, revise NRI/OCI holding limits, and prevent investors from blending routes to bypass the 10% threshold. According to the author, this regulatory shift will deepen the investor base of Indian capital markets with wider global access.
Notifications and Circulars
· Companies Compliance Facilitation Scheme, 2026 extended up to 31 August 2026
· Formats prescribed for publishing financial results by listed general insurers under the SEBI LODR Regulations
· IRDAI clarifies on implementation of Ind AS; Defines role of Appointed Actuary and Independent Validation Framework
· Draft Foreign Exchange Management (Foreign Investment) Rules, 2026 released for comments; To replace the NDI Rules, 2019
· SEBI operationalises ISIN-Level freeze on promoter holdings during buybacks
· SEBI simplifies and standardises the framework for transmission of securities; Introduces fast-track route for low-value claims
Ratio Decidendi
· Regulatory compliance under SEBI Regulations is mandatory and cannot be excused on the ground that investors ultimately suffered no loss or earned profits – Supreme Court
· Recovery certificate issued by Debt Recovery Tribunal prior to the 2016 amendment is not a ‘Decree or Order’ for issuing an insolvency notice under Section 9(2) of the Presidency Towns Insolvency Act, 1909 – Supreme Court
· CIRP cannot be initiated on the basis of a composite transaction involving purely contractual obligations – Supreme Court
· Orders rejecting jurisdictional objections under Section 16 of the Arbitration and Conciliation Act cannot ordinarily be challenged under Article 227 – Supreme Court
· A clause providing for refund of earnest money does not bar specific performance, and concurrent findings of fact cannot be reopened in second appeal – Supreme Court
News Nuggets
· CCI approves acquisition of Royal Challengers Sports
· CCI approves upGrad's acquisition of Unacademy
· CCI clears Malabar Group’s corporate restructuring
· SEBI proposes revamp of Online Dispute Resolution Framework
· Sun Pharma's USD 11.75 Billion acquisition of Organon moves closer to completion
· SEBI clears key regulatory hurdle for NSE's IPO
