FEMA

Comprehensive Guide to Form LLP(I): Reporting FDI in LLPs under FEMA

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Introduction

Form LLP(I) is the statutory form that an Indian Limited Liability Partnership (LLP) must file with the Reserve Bank of India (RBI) to report receipt of Foreign Direct Investment (FDI). Governed under the Foreign Exchange Management Act (FEMA), 1999, this form ensures that all foreign capital inflow into LLPs is transparent, regulated, and in compliance with India’s foreign investment framework.

This guide offers a thorough breakdown of everything you need to know about Form LLP(I), including prerequisites, step-by-step filing procedures, documentation, compliance checks, and penalties for non-compliance.

Legal Framework and Governing Authority

  • FEMA, 1999: Section 6(3)(b) mandates reporting of foreign investment.
  • FEMA Notification No. 20(R)/2017-RB: Consolidated FEMA (Non-debt Instruments) Regulations.
  • FDI Policy (DPIIT): Governs sectoral caps and investment conditions.
  • RBI Master Direction on Reporting under FEMA: Defines formats, procedures, and portal-related guidelines.

What is Form LLP(I)?

Form LLP(I) is a reporting form filed on the FIRMS (Foreign Investment Reporting and Management System) portal of the RBI. It is used to intimate the RBI when an LLP receives capital contribution and/or acquisition of profit share by a person resident outside India.

Applicability of Form LLP(I)

You must file Form LLP(I) if:

  1. Your LLP has received foreign capital contribution from:
    • A foreign individual
    • A foreign company
    • A foreign LLP or body corporate
  2. There has been acquisition or transfer of profit-sharing rights by a non-resident.
  3. The foreign investment is under the automatic route and adheres to sectoral guidelines.

Prerequisites Before Filing Form LLP(I)

1. Entity Master Registration

  • Mandatory one-time registration of the LLP on the FIRMS Portal’s Entity Master module.
  • Without this, filing on FIRMS portal is not possible.

2. Business User (BU) Registration

  • The person filing the form must be registered as a Business User.
  • Requires:
    • Authorization Letter from the LLP
    • PAN and contact details of the BU
    • Approval from RBI

3. Check FDI Policy Compliance

Ensure that:

  • 100% FDI is allowed in your sector.
  • The investment complies with the automatic route (i.e., no government approval required).
  • The LLP is not engaged in activities requiring industrial licensing or government approval.

Timeline for Filing

  • Must be filed within 30 days from the date of receipt of foreign contribution into the LLP’s bank account.

Information Required for Form LLP(I)

A. Basic Information

  • LLPIN
  • PAN
  • Registered Office Address
  • Email and Mobile Number

B. Details of Foreign Investor

  • Name and nationality (for individuals)
  • Name and country of incorporation (for companies/LLPs)
  • Nature of the entity (company, LLP, trust, etc.)
  • Type of investment (new/additional)

C. Investment Details

  • Date of receipt of funds
  • Amount received in foreign currency and INR equivalent
  • Type of capital instrument: Capital contribution / Profit share
  • Sector of operation
  • % of profit share held by the foreign investor
  • Mode of payment (inward remittance, NRE/NRO account, etc.)

D. AD Bank Details

  • Name and branch of Authorised Dealer (AD) Bank
  • Bank reference number
  • FIRC details

E. Valuation Details

  • Name of Valuer (CA or Registered Valuer)
  • Method of valuation (DCF, NAV, Book Value)
  • Valuation certificate (if applicable)

Mandatory Attachments (PDF Format, <1 MB each)

  1. FIRC (Foreign Inward Remittance Certificate) from AD Bank
  2. KYC Report of the foreign investor (issued by overseas bank and attested by Indian AD Bank)
  3. LLP Agreement and Supplementary Agreement (if applicable)
  4. Valuation Certificate (if applicable)
  5. Board/Partner Resolution authorizing the investment
  6. Declaration cum Undertaking signed by the Authorized Partner
  7. Authorization Letter for Business User (if not already submitted)

Step-by-Step Filing Process

  1. Log in to FIRMS Portal (https://firms.rbi.org.in)
  2. Navigate to “Single Master Form (SMF)”
  3. Choose “Form LLP(I)”
  4. Enter all requested details and upload attachments
  5. Submit the form online
  6. Form goes to AD Bank for verification
  7. AD Bank forwards it to RBI for final processing
  8. Status will show as: “Acknowledged / Approved / Sent Back / Rejected”

Post-Filing Compliance

  • Keep acknowledgment and approval copy for your records
  • Update LLP Agreement (if capital structure has changed)
  • File Form 3 with ROC for change in contribution/profit sharing (as per LLP Act)
  • Reconcile investment in financial statements

Penalties for Non-Compliance

Under Section 13 of FEMA, 1999:

  • Penalty: Up to 3x the amount involved or ₹2,00,000 (whichever is higher)
  • For continuing contraventions: Additional ₹5,000 per day until the default is rectified

Also:

  • May impact future investment rounds
  • May delay or block downstream investments
  • Can raise red flags during due diligence

Key Considerations and Best Practices

  • Don’t wait till the last day – coordinate with your AD Bank early
  • Maintain digital copies of all documents
  • Ensure correct classification of sector – check DPIIT guidelines
  • Keep the LLP Agreement updated
  • Cross-verify FIRC and KYC before submission

Common Errors to Avoid

  • Incorrect LLPIN or PAN
  • Wrong sector code or description
  • Uploading unsigned or blurry documents
  • Not updating Entity Master before filing
  • Delay in obtaining FIRC/KYC from Bank

Conclusion

Form LLP(I) is a critical compliance requirement under FEMA for LLPs receiving foreign investment. While the form itself is digital and the process is streamlined through the FIRMS portal, the legal and documentary prerequisites make it essential to plan ahead. Timely and accurate filing helps in ensuring regulatory confidence and smooth capital inflow for business growth.

📞 Need Help?

If you need expert assistance with:

  • Filing Form LLP(I)
  • Entity Master and Business User registration on FIRMS Portal
  • Preparing valuation reports, LLP agreements, and KYC documents
  • Ensuring FEMA and RBI compliance for foreign investment in LLPs

Get in touch with our compliance and advisory experts at:

Lapras Business Consultants
 📍 C-803, 8th Floor, Tower C, Noida One, Sector 62, Noida 201309
📞 +91-9643349020
📧 reachus@lapras.in

We make foreign investment compliance easy, timely, and fully aligned with RBI norms.

This article is current as of July 2025. Always check the latest RBI Master Directions and FEMA Notifications for updated requirements.

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