Swiggy Aims for India-Owned Status Amid Foreign Investment Regulations
Swiggy moves to become India-owned and controlled company under FEMA rules
The Economic Times
Image: The Economic Times
Swiggy, a food and grocery delivery platform based in Bengaluru, India, is seeking to become an India-owned and controlled company (IOCC) under the Foreign Exchange Management Act (FEMA). This move comes in response to institutional investor inquiries and aims to shift ownership and control to resident Indian citizens or eligible Indian entities.
- 01Swiggy is proposing changes to its board to qualify as an India-owned and controlled company.
- 02This initiative addresses concerns from institutional investors regarding ownership structure.
- 03Under FEMA, an IOCC must have ownership and control by resident Indian citizens or eligible entities.
- 04Currently, foreign investors own nearly 60% of Swiggy's shares.
- 05The amendments are part of Swiggy's broader strategy to comply with Indian regulations.
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Swiggy, the Bengaluru-based food and grocery delivery service, has announced plans to amend its board framework to qualify as an India-owned and controlled company (IOCC) under the Foreign Exchange Management Act (FEMA). This decision follows inquiries from institutional investors regarding the company’s ownership structure. According to FEMA regulations, a company can only be classified as an IOCC if both ownership and control are held by resident Indian citizens or eligible Indian entities. Currently, foreign investors possess nearly 60% of Swiggy's shares, highlighting the need for the company to shift its governance model. The proposed changes aim to enhance domestic control and address regulatory compliance, marking a significant step in Swiggy's strategic direction.
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This move could lead to increased domestic investment in Swiggy, potentially benefiting local stakeholders and employees.
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