India private equity lawyer

Private equity transactions that cross between the United States and India sit at the intersection of two distinct legal systems. A US-based fund acquiring an interest in an Indian portfolio company, or an Indian sponsor raising capital from US limited partners, engages US securities and corporate law on one side and India’s foreign investment regulatory framework on the other. The Foreign Exchange Management Act, 1999 (FEMA), the consolidated FDI Policy administered by the Department for Promotion of Industry and Internal Trade, SEBI regulations governing foreign portfolio investors, and Reserve Bank of India guidelines each shape the structure, pricing, and exit mechanics of a deal. Law Offices of SRIS, P.C., a US law firm practicing since 1997, handles the US-law aspects of these cross-border transactions. For India-law matters, the firm collaborates with India-admitted Of Counsel who are enrolled with the Bar Council of India and are not admitted in any US state bar.

What This Cross-Border Practice Area Covers

Cross-border private equity practice involving India encompasses the legal work required to structure, document, and close an investment where the investor, the target, or the capital flows cross between US and Indian jurisdictions. On the US side, this includes securities law compliance under the Securities Act of 1933 and the Investment Company Act of 1940, fund formation and limited partnership agreement drafting under Delaware or other US state law, and anti-corruption diligence under the Foreign Corrupt Practices Act (FCPA). On the India side, it includes structuring the investment to comply with FEMA, the FDI Policy’s sectoral caps and entry routes, SEBI’s foreign portfolio investor framework, and the pricing guidelines issued by the Reserve Bank of India. The India-US Double Taxation Avoidance Agreement (DTAA) also informs the choice of investment vehicle and jurisdiction for intermediate holding companies.

A private equity lawyer working across these jurisdictions does not practice both US and Indian law simultaneously. Rather, the US-admitted attorney handles the US-law dimensions of the transaction, and the India-admitted attorney handles the India-law dimensions. The two collaborate as needed while maintaining strict jurisdictional separation. This division of responsibility is fundamental to the ethical practice of cross-border law and is required by the bar rules of both countries.

How US-India Private Equity Matters Are Structured

A typical US-India private equity transaction begins with structuring analysis. The India side determines whether the target sector permits foreign direct investment under the automatic route or requires prior government approval. The US side evaluates whether the fund structure triggers registration or exemption requirements under US securities laws. The choice of investment instrument—equity shares, compulsorily convertible preference shares, or compulsorily convertible debentures—is governed by FEMA pricing guidelines and RBI circulars. The US-admitted attorney reviews the subscription agreement, shareholders’ agreement, and exit provisions for consistency with US law and market practice, while the India-admitted attorney ensures compliance with Indian corporate law, stamp duty requirements, and foreign exchange regulations.

US-side diligence addresses FCPA risk, and US securities law disclosure obligations. India-side diligence examines the target’s compliance with the Companies Act, 2013, FEMA, SEBI regulations, and sector-specific licensing requirements. The two workstreams proceed in parallel, with each attorney operating within their respective licensure. The closing mechanics also reflect the dual-jurisdiction nature of the transaction: funds may flow through authorized dealer banks in India under RBI oversight, while US-side closing deliveries are governed by the purchase agreement’s choice of law, often New York or Delaware law.

About the Attorneys

Atchuthan Sriskandarajah, Esq. is the principal attorney and founder of Law Offices of SRIS, P.C., admitted to practice law in Virginia, Maryland, the District of Columbia, New Jersey, and New York. He serves as the responsible US attorney for the firm’s cross-border private equity practice, handling the US-law aspects of transactions involving Indian counterparties, funds, and portfolio companies. His background includes experience with US securities law, corporate structuring, and cross-border transaction documentation.

For India-law matters, the firm collaborates with Sowmya R, Of Counsel, who is enrolled with the State Bar Council of Madhya Pradesh (Enrollment No. MP2285/2014) and is not admitted in any US state bar. Her role is limited to India-law matters in collaboration with the US-admitted attorneys of the firm. All US-law aspects of a transaction are handled by Mr. Sris and the US-admitted attorneys of the firm. This division ensures that each component of a cross-border private equity matter is addressed by counsel licensed in the relevant jurisdiction.

Frequently Asked Questions

What does a private equity lawyer do in cross-border India-US transactions?

A private equity lawyer in cross-border India-US transactions structures and documents the investment to comply with the laws of both jurisdictions. On the US side, this involves securities law analysis, fund documentation, and anti-corruption diligence. On the India side, it involves FEMA compliance, FDI Policy review, and SEBI regulatory analysis where applicable. The US-admitted attorney and the India-admitted attorney each work within their respective licensure, collaborating on deal terms that must satisfy both legal frameworks. The lawyer does not practice law in a jurisdiction where they are not admitted; rather, the transaction is divided so that each component is handled by counsel licensed in the relevant country.

Do I need both a US-admitted lawyer and an India-admitted lawyer for a private equity deal involving India?

Yes, a cross-border private equity transaction between the US and India typically requires both a US-admitted attorney and an India-admitted attorney. The US-admitted attorney handles US securities law, fund formation, and FCPA compliance. The India-admitted attorney handles FEMA, FDI Policy, SEBI regulations, and Indian corporate law. Neither attorney can advise on the other country’s law unless they hold a license in that jurisdiction. Law Offices of SRIS, P.C. provides the US-law representation through its US-admitted attorneys and collaborates with India-admitted Of Counsel for the India-law aspects of the transaction.

How are foreign investments into India regulated?

Foreign investments into India are regulated primarily by the Foreign Exchange Management Act, 1999 (FEMA), the consolidated FDI Policy, and regulations issued by the Reserve Bank of India and SEBI. The FDI Policy sets out sectoral caps and specifies whether investment in a given sector is permitted under the automatic route, which does not require prior government approval, or the government route, which does. FEMA governs the pricing, reporting, and repatriation of foreign investment. SEBI regulates foreign portfolio investors who invest in publicly traded Indian securities. The regulatory framework is administered by the Department for Promotion of Industry and Internal Trade, the RBI, and SEBI, each with distinct areas of authority.

What is the difference between the automatic route and the government route for FDI in India?

The automatic route permits foreign direct investment in specified sectors without prior approval from the Indian government, while the government route requires approval from the relevant ministry or department before the investment can proceed. Most sectors are open to foreign investment under the automatic route, subject to sectoral caps. A smaller number of sectors require government approval, typically those involving national security, certain media categories, or sectors where foreign investment is restricted. The applicable route depends on the target company’s sector, the percentage of foreign ownership proposed, and the investor’s country of origin. The consolidated FDI Policy, published annually by the Department for Promotion of Industry and Internal Trade, specifies which route applies to each sector.

How does the India-US Double Taxation Avoidance Agreement affect private equity structures?

The India-US Double Taxation Avoidance Agreement (DTAA) allocates taxing rights between the two countries and can affect the choice of intermediate holding company jurisdiction in a private equity structure. The DTAA addresses taxation of capital gains, dividends, and interest, and provides for reduced withholding tax rates in certain circumstances. For a US fund investing in an Indian portfolio company, the DTAA may influence whether the fund invests directly or through an intermediate entity in a jurisdiction such as Mauritius, Singapore, or the Netherlands, each of which has its own tax treaty with India. Treaty benefits are subject to limitation-of-benefits provisions and general anti-avoidance rules under Indian tax law.

What role does the Foreign Exchange Management Act (FEMA) play in India-focused private equity?

FEMA governs the inflow, pricing, and repatriation of foreign exchange in connection with private equity investments in India. It establishes the framework within which a foreign investor may subscribe to shares or convertible instruments of an Indian company, and it sets the conditions under which investment proceeds and returns may be remitted abroad. FEMA also imposes reporting obligations on the Indian company receiving foreign investment and on the authorized dealer bank through which funds flow. Compliance with FEMA is essential to the validity of the investment and to the investor’s ability to exit and repatriate capital. The Reserve Bank of India issues circulars and master directions that interpret and implement FEMA’s provisions.