sir as per sec 2 (87) as per companies act definition of subsidiary company there is no limit on layers while acquiring company incorporated outside india if A ltd purchased shares of some foreign company called X llc incorporated in usa and hat X llc have one subsidiary in india if the chain goes on holding company A ltd will having more than 2 or more companies as subsidiaries is it also an exemption can u explain me with some example for more clarity

1 answer

Ravi Staff April 4, 2019

Language of the rule
Provided that the provisions of this sub-rule shall not affect a company from acquiring a company incorporated outside India with subsidiaries beyond two layers as per the laws of such country
exemption is available if such layers / subsidiaries  are as per law of foreign countries
so in your case if chain comes back to india, such exemption wont be applicable

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