Tag: Regulatory

fpi investments

FPI Investments in the Indian Debt Markets: An Overview

Insights | February 13, 2025 | Practice Area: , , ,

Investments in debt securities in India by non-residents require compliance with an array of Indian foreign exchange and securities regulations. Overseas investors intending to invest in debt instruments in India typically do so either under the Reserve Bank of India’s (“RBI”) framework for external commercial borrowings (“ECB”) or through the route available for foreign portfolio investors (“FPI”) registered with the Securities and Exchange Board of India (“SEBI”). In recent years, the FPI route has become a popular option for overseas investors looking to invest in India’s debt markets on a regular basis as it allows for greater flexibility in terms of interest, repayment terms, security cover and end use of funds in comparison to the ECB route. According to data from the National Securities Depository, FPI investments in the Indian debt markets stood at INR 1.1 trillion in 2024. 
In January 2025, the RBI issued Master Direction – Reserve Bank of India (Non-resident Investment in Debt Instruments) Directions, 2025 (“Master Direction”), which, inter alia, consolidates a number of the circulars and directions issued by the RBI on investments in debt instruments by non-resident investors, including FPIs. This note analyzes the key regulatory aspects governing FPI investments in corporate debt securities, particular in light of the Master Direction.

Investing in India: An Overview of Legal Considerations – 2025 Checklist

Insights | February 5, 2025 | Practice Area: , , , , , ,

Foreign investment continues to play a crucial role in India’s economic growth with India achieving the milestone of having received USD 1 trillion of foreign direct investment since April 2000. While the cumulative FDI received in the financial years ended March 31, 2023, and March 31, 2024 remained similar, there has been an increase in the FDI received between April 2024 to September 2024 in comparison to previous years.
This note examines certain key legal considerations for foreign investors investing in India and highlights key updates included in the legal framework during the calendar year 2024.

Greenwashing

Greenwashing: An Overview

Insights | January 22, 2025 | Practice Area: , , ,

Companies are responding to rising global demands for environmentally safe products and sustainable practices. However, unverified and unsubstantiated claims in relation to sustainability records and climate change commitments can lead to allegations of ‘greenwashing’ if such marketing tactics are designed to make the public believe that a company is doing more to protect the environment than it really is. ‘Greenwashing’ refers to the practice of misleading consumers, investors and other stakeholders by making false or exaggerated claims or use of misleading words or imagery about a company’s environmental or sustainability-related performance while downplaying or concealing harmful attributes.
This note discusses Greenwashing in India, in particular, greenwashing guidelines issued by regulatory authorities, including the Advertising Standards Council of India and the Central Consumer Protection Authority.

data minimization

Navigating Data Minimization Requirements under India’s DPDP Act

Insights | January 17, 2025 | Practice Area: , ,

While the provisions of India’s Digital Personal Data Protection Act, 2023 (“DPDP Act”) and its rules are yet to be notified, organizations need to prepare for a new set of compliance obligations and plan ahead. In large part, the DPDP Act follows global regulatory templates like the EU’s GDPR and embodies similar overarching principles such as data minimization and purpose limitation. The procedural implications of such principles reflected in the DPDP Act will translate into specific obligations and practices related to data collection, processing, sharing, and storage, especially in the context of Big Data analytics – including through the use of artificial intelligence and machine learning techniques.
This note analyzes the principle of data minimization under the DPDP Act, its interface with other laws (including with respect to consumer protection), and discusses potential learnings from other jurisdictions, including for the purpose of implementing such principle at an operational level.

OFC Networks

Fiber Opportunity in India: Regulatory Framework and Right-of-Way Management

Insights | January 16, 2025 | Practice Area: , , , ,

With increasing demand for high-speed internet, 5G roll-out and data center growth, deployment of a robust and reliable optic fiber cable (“OFC”) infrastructure has become essential to support India’s expanding digital ecosystem. Fueled by this market opportunity, companies are focusing on expanding their OFC networks and investors are exploring potential opportunities for fiber investments in India. Several telecom operators have already consolidated their fiber assets in a path towards monetization of such assets.
This note explores the legal framework and recent developments regarding Right-of-Way for OFC in India.

Digital Personal Data Protection Rules

Draft Digital Personal Data Protection Rules, 2025

Legal Updates | January 10, 2025 | Practice Area: , ,

A long-anticipated draft of the Digital Personal Data Protection Rules, 2025 (“Draft Rules”) was released by the Central Government (“Government”) on January 3, 2025 for public consultation and comments, along with an explanatory note on the contents on the Draft Rules. Once brought into effect, these rules will enable implementation of the Digital Personal Data Protection Act, 2023 (the “DPDP Act” or the “Act”), which was published in the Official Gazette on August 11, 2023, although not yet in force. The consultation process on the Draft Rules will continue until February 18, 2025. The rules under the DPDP Act are proposed to be implemented in a staggered manner.
To recap, the DPDP Act lays down the law for processing of digital personal data (any data in digital form about an individual who is identifiable by or in relation to such data) in a manner that recognizes both the rights of individuals to protect their personal data and the need to process such data for lawful purposes and for connected or incidental matters. For an overview of the provisions of the DPDP Act, please see our notes here and here.
This note analyzes certain key aspects introduced or further clarified under the draft rule.

Carbon Border Adjustment Mechanism

Implementation of the EU’s Carbon Border Adjustment Mechanism and its Implications

Insights | January 9, 2025 | Practice Area: , , , , ,

The European Union’s Carbon Border Adjustment Mechanism (“CBAM”), applicable to imports from ‘third countries’ (i.e., non-EU countries), endeavors to impose a price on emissions in respect of the production and supply of carbon-intensive goods. By ensuring that a price is paid for such embedded emissions, the CBAM aims to make the carbon price of imports equivalent to that of domestic production, especially when third countries do not appropriately impose such price.
Although the CBAM has been mainly presented as a climate measure, it may also end up operating as a unilateral trade restriction designed to protect EU manufacturing. Several countries, including India, have labeled the CBAM as protectionist. While the global implications of the CBAM appear to be diverse, certain countries, including developing and newly industrialized nations, have claimed to be the worst hit, while developed countries are likely to have less carbon-intensive production processes.
The CBAM’s compliance requirements are expected to reduce the profits of Indian exporters in key sectors. Indian manufacturers from key trade-exposed industries (including those that are energy-intensive) are further poised to incur an increase in fuel costs, leading to a decrease in export earnings.
While India has discussed retaliatory measures, it is also pursuing the option of getting its Carbon Credit Trading Scheme, 2023 recognized by the EU and aligning it with the CBAM. Separately, the EU and India are engaged in talks on a proposed Free Trade Agreement, where India has raised concerns about the CBAM being similar to non-tariff barriers.
However, consistent with India’s own goals, the CBAM could also offer potential synergies, including in terms of green hydrogen partnerships and increased renewable energy deployment. Indian producers and exporters could view the CBAM as an opportunity to scale up sustainability-driven practices, including to enhance their positioning in a globally competitive market. Going forward, while carbon reporting and emissions monitoring will be essential, Indian companies should also consider investing in appropriate R&D, including with respect to emerging technologies.

spectrum allocation in India

Accessing Space for Commercial Activities and Satellite Spectrum Allocation in India

Insights | January 6, 2025 | Practice Area: , , , ,

The Government of India has been actively working towards liberalizing the space sector and enhancing private sector participation. In this regard, given the stakes involved and the positions taken by various interested parties, the process for allocation of satellite spectrum remains a contentious point.
There has been a major debate among service providers regarding the appropriate way to allocate satellite spectrum.
While the Telecommunications Act, 2023 (“Telecom Act”) favors administrative allocation of satellite spectrum, the details of such process are yet to be finalized. This note considers the debate involving auctions and administrative allocation and provides an overview of past and recent developments with respect to Supreme Court judgements, digital communications policy, frequency allocation plan, space policy and the Telecom Act. It also discusses past consultation papers and recommendations of the Telecom Regulatory Authority of India on satellite spectrum allocation, as well as the recent provisional satellite spectrum allocation approved by the Department of Telecommunications.

sustainable finance

SEBI’s New Framework for Sustainable Finance: A Review Beyond Environmental Sustainability

Insights | December 24, 2024 | Practice Area: , ,

In order to expand the asset class for which Indian entities can issue and list debt securities with a purpose of using the proceeds for developing sustainable projects, the Securities and Exchange Board of India recently amended the Securities and Exchange Board of India (Issue and Listing of Non-Convertible Recently Securities) Regulations of 2021 (“NCS Regulations”) on December 11, 2024. Previously, the framework under the NCS Regulation only covered issuances of green debt securities. The amendment has introduced the concept of ESG debt securities, which now includes a framework for issuances of social bonds, sustainability bonds, sustainability linked bonds and green debt securities under its ambit.
This note discusses the amendment in light of India’s commitment towards reducing its intended nationally determined contributions together with the implications for listed issuances of the ESG debt securities by Indian corporates to potential domestic and foreign investors as well as highlights the gaps in the current form of the NCS Regulations.

AI legal challenges

Addressing Legal Challenges on AI Development and Use

Insights | December 23, 2024 | Practice Area: , , , ,

The recent lawsuit by Asian News International against OpenAI in the Delhi High Court mirrors global trends involving allegations that large language models (“LLMs”) are being trained on copyrighted material without authorization or licenses, leading to copyright infringement. For the purpose of balancing innovation with compliance, artificial intelligence (“AI”) developers in India must take proactive measures to navigate the complex interplay of copyright, data protection and liability issues. By securing licensing agreements, clarifying the scope of ‘fair use’ under copyright law, offering indemnities to users, and preparing for court-directed compliance actions, AI developers can mitigate risks and build legally compliant AI systems.