Brief Overview:
Ship lessors in GIFT City are restricted from involving themselves in any transaction regarding transfer of title (ownership/leasehold) of a ship/vessel from person resident in India to GIFT entity for the purpose of providing services solely to person resident in India.
Though acquisitions of new ships or new lease contracts with person resident outside India to serve person resident in India is permitted.
Technical Details:
IFSCA has laid down a Ship Leasing Framework that deals with entities registered under Finance Company Regulations for undertaking ship lease transactions.
IFSCA issued a circular introducing additional requirements for finance companies acting as lessors under the said framework.
Vide this circular, specific conditions with respect to transactions involving transfer of ownership or leasehold rights of ships/ vessels are laid down where services are provided to person resident in India.
Key Takeaways:
GIFT City Finance Company needs to be careful on end use of the vessel while acquiring ship from Indian entities.
For further details, please see:
https://ifsca.gov.in/Legal/Index?MId=79SiBKQDORY=
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