Regulations 4 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Three provisions of the Foreign Exchange Management (Remittance of Assets) Regulations, 2016 deal with remittances by entities and offices rather than by individuals. Regulation 4(3) lets an authorised dealer allow remittance out of the assets of an Indian company under liquidation. Regulation 5 lets an Indian entity remit contributions to provident, superannuation or pension funds of its expatriate staff. Regulation 6 sets out the application and the four documents a branch office or liaison office needs to remit its assets on closure or its winding up proceeds.
This article states the position as the Regulations were notified on 1 April 2016 (Notification No. FEMA 13 (R)/2016-RB), with every document as the Master Direction - Remittance of Assets prints it, "updated as on June 29, 2026". The Master Direction's Appendix lists no amendment of the Regulations themselves. Later changes should be checked. The Regulations are made under section 47 of the Foreign Exchange Management Act, 1999; see our article on sections 47 and 48 of the Act. For the closing of an Indian office of a foreign company, our liaison, branch and project office service covers the steps.
An authorised dealer may allow remittance out of the assets of an Indian company under liquidation if it complies with the court or liquidator's order and the applicant files three auditor certificates or confirmations. An Indian entity may remit provident fund, superannuation or pension fund contributions for expatriate staff who are resident in India but not permanently resident, meaning a stay of a specified duration or a specific assignment not exceeding three years. A branch or liaison office (not a project office) applies to the authorised dealer for remittance on closure with four sets of documents: the Reserve Bank's permission, an auditor's certificate, a confirmation on legal proceedings and a report from the Registrar of Companies.
Regulation 4(3): companies under liquidation
An authorised dealer in India "may, also allow remittance out of the assets of Indian companies under liquidation under the provisions of the Companies Act, 2013", subject to two conditions.
| Condition | What the text says |
|---|---|
| (i) | The Authorised Dealer shall ensure the remittance is in compliance with the order issued by a court in India, or the order issued by the official liquidator or the liquidator in the case of voluntary winding up |
| (ii) | No remittance shall be allowed unless the applicant submits the three documents below |
The three documents under clause (ii):
- (a) An auditor's certificate confirming that all liabilities in India have been either fully paid or adequately provided for.
- (b) An auditor's certificate to the effect that the winding up is in accordance with the provisions of the Companies Act, 2013.
- (c) In case of winding up otherwise than by a court, an auditor's certificate to the effect that there is no legal proceedings pending in any court in India against the applicant or the company under liquidation and there is no legal impediment in permitting the remittance.
What the Master Direction says
The Master Direction (paragraph 3.3.1) states the same three certificates but differs in two places. It speaks of "directions issued by a Court in India/ orders issued by official liquidator in case of voluntary winding up", where the Regulations speak of "the official liquidator or the liquidator". And its second certificate says the winding up is in accordance with the provisions of the Companies Act, 1956, where the Regulations say the Companies Act, 2013. The Regulations' text is followed here, and the reader should confirm the point against the official text.
Regulation 5: contributions for expatriate staff
Regulation 5(1) says "An entity in India may remit the amount being its contribution towards the provident fund/ superannuation/ pension fund in respect of the expatriate staff in its employment who are resident in India but not permanently resident therein."
The Explanation gives two definitions:
| Term | Meaning |
|---|---|
| Expatriate staff | A person whose provident, superannuation or pension fund is maintained outside India by his principal employer outside India |
| Not permanently resident | A person resident in India for employment of a specified duration (irrespective of length thereof) or for a specific job or assignment, the duration of which does not exceed three years |
The regulation lets the entity remit the contribution; it does not describe a procedure or document list, and none is given here. The Master Direction (paragraph 3.3.2) says authorised dealers may allow Indian entities to remit such contribution for expatriate staff "resident but 'not permanently resident' in India", and paragraphs 2.5 and 2.6 repeat the two definitions, with "not more than three years" for the duration. For employee-side questions see our income-tax guides.
Regulation 6: closure of a branch or liaison office
The heading of regulation 6 reads: "Permission for remittance of assets on closure or remittance of winding up proceeds of branch office/ liaison office (other than project office)". A branch or office established in India by a person resident outside India may apply to the Authorised Dealer concerned, supported by the following.
| Item | Document |
|---|---|
| (A) | A copy of the Reserve Bank's permission for establishing the branch or office in India, wherever applicable |
| (B)(i) | Auditor's certificate indicating the manner in which the remittable amount has been arrived at, supported by a statement of assets and liabilities, and the manner of disposal of assets |
| (B)(ii) | Auditor's certificate confirming that all liabilities in India including arrears of gratuity and other benefits to employees of the branch or office have been fully met or adequately provided for |
| (B)(iii) | Auditor's certificate confirming that no income accruing from sources outside India (including proceeds of exports) has remained un-repatriated to India |
| (B)(iv) | Auditor's certificate confirming that the branch or office has complied with all regulatory requirements stipulated by the Reserve Bank from time to time regarding functioning of such offices in India |
| (C) | A confirmation from the applicant that no legal proceedings are pending in any Court in India and there is no legal impediment to the remittance |
| (D) | A report from the Registrar of Companies regarding compliance with the provisions of the Companies Act, 2013, in case of winding up of the office in India |
Sub-regulation (2)
On consideration of the application, the authorised dealer "may permit the remittance subject to the directions issued by the Reserve Bank in this regard, from time to time". The Regulations set no time limit and no form of application; none is given here.
The Master Direction (paragraph 3.4)
The Master Direction lists the same documents. It words item (A) as "a copy of the Reserve Bank's permission for establishing the branch/ office in India" without the Regulations' words "wherever applicable", and it does not repeat sub-regulation (2). Where the two differ, the Regulations' words are followed here.
Closure of the offices, transfer of assets and winding up under the Branch, Liaison and Project Office Regulations are explained in our article on regulation 4(j), (k) and (m) of the Establishment Regulations. A wider guide is closure of foreign company operations in India.
Individuals' remittances and the rest
Regulations 4(1) and 4(2) (foreign nationals, NRIs and PIOs), regulation 7 (Reserve Bank's prior permission) and regulation 8 (taxes) are in our article on remittance of assets by individuals. The Master Direction's paragraph 5 notes that remittances are subject to payment of applicable taxes in India and that authorised dealers must comply with tax laws.
A worked example
Quillfeather Trading Branch, the Indian branch of a foreign company, is closing. It applies to its Authorised Dealer with a copy of the Reserve Bank's permission, an auditor's certificate on how the remittable amount was arrived at, a statement of assets and liabilities, certificates on liabilities and gratuity, un-repatriated export income and regulatory compliance, its own confirmation on legal proceedings, and a Registrar of Companies report on compliance with the Companies Act, 2013. The Authorised Dealer may then permit the remittance subject to the Reserve Bank's directions. The names are invented.
Need help closing an office or winding up?
The four sets of documents, and the auditor's work behind three of them, take longer than the application. Our liaison, branch and project office team can prepare the closure file and run the application through the authorised dealer.
Key takeaways
- An authorised dealer may allow remittance out of assets of an Indian company under liquidation on compliance with the court or liquidator's order and three auditor certificates.
- An Indian entity may remit provident, superannuation or pension fund contributions for expatriate staff who are not permanently resident (stay of specified duration or an assignment not exceeding three years).
- A branch or liaison office (not a project office) applies to the authorised dealer with the Reserve Bank's permission, an auditor's certificate, a legal proceedings confirmation and a Registrar of Companies report.
- The Master Direction refers to the Companies Act, 1956 in one place where the Regulations refer to the Companies Act, 2013.
Read next
- Remittance of assets by individuals: regulations 1 to 4, 7 and 8
- Closure, transfer of assets and winding up: regulation 4 of the Branch, Liaison and Project Office Regulations
- Liaison office, branch office and project office: differences
- Repatriation rules under FEMA: complete guide
Disclaimer: Based on the Gazette text of the instrument this article names, as notified and as amended by the notifications named in the article (for the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 the latest amendment consulted is S.O. 4870(E) dated 2 September 2026), as consulted on 2 October 2026. There is no official consolidated text; the provisions were read with each amendment applied. Sectoral caps, entry routes, conditions, forms and time limits change by notification, press note and circular; later changes should be checked on the Gazette, DPIIT and Reserve Bank sites. This article is general information, not legal advice; check the official text before acting.