Some of the key changes made via this notification are-
- Banks can now allow transfer of ECB from one company to another on account of re-organisation at the borrower’s level in the form of merger/demerger/ amalgamation/acquisition, provided that they are convinced that the company acquiring the ECB is an eligible borrower and adheres to all the applicable guidelines.
- Banks have been empowered to make changes to the name of the ECB lender, after satisfying themselves on the authenticity of such transactions.
- The new norms will be applicable to ECBs raised under the automatic and approval routes and not to foreigncurrency convertible debentures.
- Banks can make changes and modifications in the draw-down and repayment schedules. This involves any change made in the average maturity period and an increase or decrease in the all-in-cost. The revised average maturity period and the terms of the all-in-cost have to be in conformity with the applicable ceilings and guidelines.
If the lender is a foreign branch or subsidiary of an Indian bank, then the changes shall be subject to the prudential norms.
January 23rd, 2015