Form FC-TRS reports the transfer of shares between a resident and a non-resident – a sale, or a gift – within 60 days of the transfer or the money moving, whichever is earlier. Where FC-GPR covers fresh issues, FC-TRS covers the secondary market: an NRI buying into an Indian company, a founder selling to a foreign fund, a foreign parent selling its stake to Indian promoters. This guide covers who files, the pricing floor-and-cap logic, gifts, and the transfers that need no FC-TRS at all.
Who files, and when
| Question | Answer |
|---|---|
| Who files | The resident leg of the transfer – resident seller or resident buyer – through a Business User on the FIRMS portal. On-market sales by NRs route through the broker/company |
| Deadline | 60 days from the transfer of instruments OR receipt/remittance of consideration – whichever is earlier. Two clocks: SPA closing and funds flow – the earlier one starts the count |
| Deferred consideration deals | Each tranche that moves is reported – the 25%/18-month deferment structure from the instruments guide generates follow-on filings |
| Verification | Your AD bank checks and acknowledges – the acknowledgment is the compliance record; the company should not register the transfer without it |
Pricing: the floor-and-cap logic
| Direction | Rule | Intuition |
|---|---|---|
| Resident → NR (foreigner buying) | Price not less than fair value | A non-resident cannot buy into India cheap |
| NR → Resident (foreigner selling) | Price not more than fair value | A non-resident cannot be handed an assured premium exit |
Fair value comes from a certificate by a practising CA, SEBI-registered merchant banker or cost accountant (listed companies: SEBI pricing). Banks want the certificate recent – within about 90 days – and the methodology stated. Selling at a loss is fine for the NR; guaranteed-return exits are not.
Documents
- Share purchase agreement + Form SH-4 transfer deed;
- Consent letters of transferor and transferee;
- Valuation certificate (see above);
- Non-resident declaration including the beneficial-ownership/land-border declaration;
- NR buying: FIRC + KYC from the remitting bank; NR selling: outward remittance evidence/bank debit advice;
- Pre/post shareholding pattern; board resolution of the company taking the transfer on record;
- Gifts: gift deed, relationship declaration, valuation.
Gift transfers – two very different directions
| Direction | Treatment |
|---|---|
| NR gifts to a resident | Permitted freely; report on FC-TRS (nature: gift, no remittance leg) |
| Resident gifts to an NR | Needs prior RBI approval – conditions include: donee eligible under the schedules, gift within relatives, cumulative gifts up to 5% of the company’s capital, sectoral cap respected, and value within USD 50,000 per financial year per donor |
When FC-TRS is NOT required
- Transfers between two residents – no FEMA leg at all;
- Transfers between two non-residents (both repatriable) – including NR-to-NR gifts;
- NRI/OCI transactions on non-repatriation basis – deemed domestic;
- Transfers where the repatriation character does not change (non-repat ↔ resident);
- Fresh allotments – that is FC-GPR territory.
Buying into or exiting an Indian company?
We run the valuation, paper the transfer and file FC-TRS – both directions, sale or gift.
Talk to My Cloud AccountantFrequently asked questions
Who is responsible for filing FC-TRS?
The resident party to the transfer – the resident seller when a foreigner buys, the resident buyer when a foreigner sells. In practice the filing happens through a Business User registered against the company’s AD bank.
Can shares be transferred before FC-TRS is acknowledged?
The company should not register the transfer in its records until the FC-TRS acknowledgment is available – AD banks and the RBI expect the sequence: agreement, consideration, FC-TRS, then registration.
Does an NRI buying shares from another NRI need FC-TRS?
No – transfers between two non-residents on repatriable basis need no FC-TRS. But a transfer that changes the repatriation character (repatriable NR to non-repat NRI) does get reported.
What if the sale price is below fair value?
If the foreigner is the seller, below-fair-value is fine (the cap applies, not a floor). If the foreigner is the buyer, the price cannot be below fair value – the deal would breach Rule 21 and the AD bank will not clear the FC-TRS.
Based on the FEM (NDI) Rules 2019 (Rules 9 and 21) and the FEM (Mode of Payment and Reporting of Non-Debt Instruments) Regulations 2019. Last reviewed: July 2026.