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IP assets may be more valuable than physical ones
The importance of a company’s intellectual property (IP) assets such as trademarks, copyrights, patents, trade secrets, designs, geographical indications and internet domain names, has grown immensely over the past decade.
IP assets are the foundation...
Changes in the profession should expand outsourcing
A recent survey of leading law firms in the UK and US by UK-based princeOMC and Legal Business indicates the direction in which legal outsourcing is currently heading.
Judging by the results, there is no...
Free trade and warehousing zones offer myriad benefits
One of the prerequisites of providing total integrated logistics solutions is well equipped warehousing. The necessity to store perishable goods generates a need for convenient and ample warehousing.
The management of warehouses is crucial for...
Balancing commercial and public interest in GM foods
The term “genetically modified food” is most commonly used to refer to crop plants created, using molecular biology techniques.
The plants are modified in a laboratory to enhance desired traits such as increased resistance to...
Revised guidelines clarify telecoms investment policy
The telecom sector in India has shown impressive growth over the past decade. Observers charting the country’s progress in the sector have found that India has the fastest growth in the number of telecom...
Latest tax bill clarifies liabilities for fringe benefits
The Finance Bill 2008, contains proposals regarding the amendment of provisions in Chapter XII-H of the Income Tax Act 1961, related to the fringe benefit tax.
The proposed amendments are either a clarification or give...
Sovereign wealth funds: Will India join the club?
Sovereign wealth funds (SWFs), or state-owned investment vehicles, are coming under increasing discussion and scrutiny. SWFs are estimated to hold over US$3,000 billion in assets. Merrill Lynch has projected that SWFs will reach US$7,900...
Airline industry is growing but it could still use a lift
As in the case of Indian sea ports, there is a mismatch between the growing freight and passenger market and the infrastructure constraints in India’s domestic and international airports.
With annual passenger growth of 20%...
Question lingers over status of pre-IPOs
India has become a hub for several young and fast moving companies with tremendous potential to achieve exponential growth. However, most of them struggle during their infancy period.
Often, the main reason for the struggle...
Tax changes in budget could impact M&A deals
T he increase in cross-border mergers and acquisitions (M&A) has led to an urgency to understand and manage the intricate tax consequences of foreign investments in India.
By the end of 2007, M&A deals in...
Outsourcing management of IP can boost profits
Knowledge and research have become important resources and key elements in the new business prototype of economic development, so it has become essential to identify and commercialize these resources.
Asian law firms and specialized agencies...
New weapons in the battle against fake drugs
Counterfeiting has become an enigma for the world pharmaceutical trade. Estimated rates of counterfeiting keep varying with the investment and ease to produce counterfeit goods, although it is certain that counterfeiting accounts for a...
Private industry gears up for bigger role in defence sector
In a landmark policy change, the defence industry was thrown open to the private sector in May 2001 (Press Note 4 of 2001 Series). The government allowed 100% equity with a maximum 26% foreign...
Plea bargaining in India: A unique concept
Plea bargaining refers to pre-trial negotiation between the prosecution and the accused during which the accused agrees to plead guilty in exchange for certain concessions by the prosecutor.
It is essentially negotiation of incentives offered...
Supreme Court decision settles double tax question
The taxablity of income earned abroad – in countries that have tax agreements with India – has been a subject of considerable debate and controversy.
One recent case settled one aspect of this question, at...
India’s anti-trust regime requires clarity
On 15-16 March, the International Bar Association, the Bar Association of India and the Confederation of Indian Industry, among others, held an International Conference on India’s New Merger Notification Regime.
Leading competition law practitioners and...
Financing gambling operations not easy
Foreign direct investment (FDI) has been recognized as an important instrument for advancing India’s foreign exchange resources, its technological base and for globalizing the Indian economy. Gambling (gaming), lottery business and betting are not...
Tax treatment could hurt domestic funds
Venture capital is a useful source of risk capital, especially for start-up ventures in the knowledge-intensive sectors. Since such funds enjoy a pass-through status, it is necessary for the government to limit the tax...
Going green: The clean development mechanism
With the Kyoto Protocol, 1997, coming into force on 16 February 2005, clean development mechanism (CDM) projects in India have attracted a great deal of interest. Indeed, with the country issuing over 32% of...
Arbitration clauses are an important feature of deals
An arbitration clause is a commonly used clause in a contract that requires the parties to resolve their disputes through an arbitration process.
Although such a clause may or may not specify that arbitration occur...
The do’s and don’ts of brand licensing in India
In India, trademark laws are stringent in accepting and acknowledging brand licences as a whole. Precedents have been set to recognize common law principles; however, to understand how rights against infringers work in practice, it...
Capital injections could help pharmaceutical industry
India has made significant progress in terms of self-reliance in pharmaceutical products. Prices for indigenously manufactured drugs are the lowest in the world.
The success story of the pharmaceutical sector stems from its reliance on...
Foreign ownership concerns unlikely to change US policy
Every year the US Department of Commerce provides volumes of economic data. Much of the press follows figures on budget deficits or surpluses and indebtedness, whether a measure for the US or for foreign...
New foreign currency bonds to be exchangeable for equity
The finance minister, during his budget speech of 2007-08, promised to introduce a new financing option for corporate India – the foreign currency exchangeable bond (FCEB).
The FCEB was conceived as an innovative structured finance...
Multimodal transport makes practical sense for shippers
International transportation of general cargo has undergone important structural changes due to advancement in transport technology including the advent of containers.
Containers are increasingly used for transportation of goods from one country to another, using...
Patent outsourcing demands special skills
The shift towards the knowledge economy has led many organizations to gradually make intellectual property a core component of their long-term strategy.
This has made companies build large patent portfolios but the need to realize...
Geographical indications can help India grow
Indian agriculture is gradually adjusting to global realities. The strategy of extending consumer assurance by way of geographic indication and appellations of origin has become a pivot for global commodity trade.
Ginger, one of the...
FDI route facilitates more real estate investment
India can be acknowledged as one of the fastest growing economies in the world and real estate has emerged as one of the most appealing investment areas for domestic as well as foreign investors.
This...
Fine payments may not be exempt from income tax
Section 28 of the Income Tax Act, 1961, deals with the chargeability of income from profits and gains of a business or profession to income tax – under the head “Profits and gains of...
Industry voices concern about merger control
In January this year, the Competition Commission of India released drafts for comment of certain regulations to implement the provisions of the Competition Act, 2002.
The commission’s intention to move forward on implementation of the...
Enforcing foreign awards should be an easier task
An award may be recognized without being enforced but if it is enforced, it is necessarily recognized. This statement by the Supreme Court in 1994 in the case of Brace Transport Corporation of Monrovia...
Relaxed regulations boost overseas acquisitions
Over the past decade or so, India has become accustomed to measuring the success and pace of its liberalization measures with the quantum of foreign investment pouring into India.
More recently, there has been a...
Laws and judgments help merger transactions
A scheme of merger is the blueprint of a merger transaction. The scheme of merger governs and prescribes the entire transaction of merger – the method of valuation of the merging companies, the share...
Using the right arbitration law offers many advantages
The validity, effect and interpretation of an arbitration agreement are governed by its “proper law”. The proper law of an arbitration agreement is usually the same as the proper law of the contract. If,...
Government invites bids for oil exploration licences
Perhaps taking its cue from this column in the previous issue of India Business Law Journal, the government of India announced the commencement of the seventh round of the New Exploration Licensing Policy (NELP...
Outsourcing requires care to protect confidentiality
Outsourcing has, in recent years, come to be associated with a wide variety of services, including software engineering, technical support, tax preparation and even medical imaging diagnostics.
Increased technology, globalized economies and access to internet...
Staged financing reduces investment risks
Globalization has increased the number of funds and cross-border deals into different geographic areas. During 2007, venture capital (VC) and private equity (PE) investments touched US$14.2 billion and spanned nearly 400 deals. In 2006...
Third party logistics gains momentum
Third party logistics (3PL), or logistics outsourcing, refers to outsourcing transportation, warehousing and other logistics related activities to a 3PL service provider that were originally performed in-house.
Logistics outsourcing is used for the logistics activities...
Creating an innovation act for India
Research over the last few decades has unequivocally established a near coalescence of the generative, application and commercial aspects of knowledge.
The intersection of seemingly unconnected and diverse fields of science and technology has generated...
Cautious moves towards greater FDI in retail
The retail sector in India is highly fragmented and organized retail in the country is at a nascent stage. Recently, however, it has emerged from the shadows and become one of the most talked-about...
Judgment clarifies tax rules for stock options
An employee stock ownership plan (ESOP) is an employee benefit plan with a defined contribution. It allows employees to become owners of stock in the company they work for. It is an equity-based deferred...
Competition Act could be ‘at war with itself’
On 13 January 2003, the Competition Act, 2002, received Rresidential assent. The act establishes a Competition Commission to “prevent practices having adverse effect on competition, to promote and sustain competition in markets, to...
Converging accounting standards challenge issuers
The International Accounting Standards Board (IASB) recently reported the announcement by the Council of the Institute of Chartered Accountants of India (ICAI) at its July 2007 meeting that Indian accounting standards will achieve full...
Non-banking financial companies consolidate
The non-banking financial companies (NBFC) sector, which grew rapidly in the early 1990s but later witnessed a turbulent period, has been in a phase of consolidation during the last two years.
The main reasons for...
Proofreading vital when filing patents
A patent is a set of exclusive rights granted by a state to a patentee in exchange for disclosure of an invention.
The process of abtaining a patent is long and requires the patentee to...
The rupee bull: Late Diwali or early Christmas?
Diwali marks the holiday shopping season in India, much like the Christmas holiday in the United States.
This year, however, Diwali has come late (or Christmas has come early) as the ever strengthening rupee presents...
Easing norms in the insurance sector
Gross foreign direct investment (FDI) inflows during April 2007 totalled US$1.6 billion as compared with US$700 million a year ago.
This large year-on-year hike speaks well of the efforts and policies of the government of...
Managing cold storage requires its own logistics
India’s agricultural sector, which accounts for approximately 65% of Indian employment, has a significant impact on the country’s economy.
It contributes roughly 40% of the country’s national income.
The agricultural sector, being at the core of...
The Deals of the Year
Following a record year for Indian M&A and capital markets transactions, India Business law Journal is proud to reveal its 2007 Deals of the Year and the lawyers who guided them to fruition
Chris Crowe...
Tax concessions favour revival of loss-making units
The Indian tax regime offers several concessions for mergers and amalgamations.
One of the key concessions is the transfer of unabsorbed losses and unabsorbed depreciation in amalagamations.
Section 72 A of the Income Tax Act, 1961,...
Arbitral awards and ‘public policy’
In the field of private international law, courts generally refuse to apply a rule of foreign law or recognize a foreign judgment or a foreign arbitral award if it goes against the accepted public...
No clarity in UAE double-taxation deal
Due to phenomenal growth in international trade and commerce and increasing interactivity among nations, residents of one country increasingly extend their sphere of business operations to other countries.
The order of the day includes flows...
Domestic hurdles curtail leveraged buy-outs
Private equity firms make most of their investments in leveraged buy-outs (LBO) that involve significant use of debt to finance the acquisition of a company.
LBOs are important instruments of merger and acquisition financing as...
Level playing field needed for domestic acquisitions
Merger and acquisition activity in India is thriving at the moment. However, it is not as vibrant as in the US and Europe on account of a lack of acquisition financing options, particularly in...
Oil and gas exploration auctions delayed
Exploration blocks in India are offered for auction under the New Exploration Licensing Policy (NELP), the first round of which was in January 1999.
During that first round, some 48 blocks were offered for the...
Certification trademarks boost economic growth
Certification is simply a designation earned by a person or a product signifying certain attributes and qualities to differentiate it from the multitude.
There are, for example, certifications for professionals, designated to perform a job...
Closed boardrooms discourage investors
To say that India is an attractive investment destination is clichéd as it is quite evident that business prospects have increased by leaps and bounds over the past decade.
The most recent push towards India...
Government, politics and trade
Government and politics have both impacted the recent climate for US-India trade. In June, I wrote in this column about potential changes in the Committee on Foreign Investment in the United States (CFIUS), the...
Continuing liberalization increases India’s appeal
In recognition of the important role of foreign direct investment (FDI) in driving economic growth, the Government of India initiated numerous economic and financial reforms in 1991, transforming the nature of the Indian economy...
ECB policy linked to exchange rate concerns
Last month, this column discussed the recent modifications by the Reserve Bank of India (RBI) to the External Commercial Borrowings (ECB) policy.
To summarize, the RBI on 7 Augustnov 2007 revised the policy restricting ECB...
New roads to help India move forwards
An efficient transportation system is a prerequisite for sustained economic growth. Road transport is vital to the country’s progress, trade promotion and social integration.
A competitive road network constitutes the basic infrastructure that propels the...
Compulsory notification of M&A deals
The Competition Act, 2002, was enacted by parliament and received presidential assent in January 2003. However, the act has since been challenged in the Madras High Court and in the Supreme Court of India...
Choosing the right outsourcing vendor
Legal process outsourcing is a buzz word that sets conversations roaring in corporate circles. Corporations all around the world have realized the value that outsourcing legal functions can bring to them.
Pioneers like GE and...
Right conditions may allow concurrent trademarks
India is a vast market with many levels of consumers with their own purchasing power and preferences for goods and services. This scenario allows for many unregistered trademarks in small pockets as the registration...
New airport regulator flies into view
Last month, this column looked at the moves towards the privatization of, and foreign investment in, Indian airports and the consequent opportunities that exist within the sector. While the business side will see more...
Conciliation an effective tool for settling disputes
Conciliation is fast gaining popularity as a mode of dispute resolution in India with courts increasingly encouraging parties to conciliate in civil disputes before resorting to litigation.
Conciliation is the process by which a conciliator,...
Tax treaties can benefit qualified non-residents
The Income-tax Act, 1961, seeks to tax India-sourced income in the hands of all kinds of assessees, irrespective of their residential status which is determined based on their physical presence in India.
Even in cases...
Venture capital: Structuring a profitable exit
Innovative ideas are always warmly welcomed. New and innovative ventures in India have not been an exception and have managed to secure financial assistance in both domestic and global markets. Venture capital is one...
Global business: Mind the public policy team
Many businesses think of “foreign policy” as the exclusive arena of governments. Multi-national companies, however, need to carefully consider their global growth strategies, and how an expert public policy team fits into their business...
RBI regulations restrict availability of debt funding
External commercial borrowings (ECB) are commercial loans with minimum average maturity (MAM) of three years, obtained from non-resident lenders.
ECB has been an important source of finance for Indian corporates, allowing them to supplement domestically...
Easier investment will help develop port infrastructure
Ports occupy a significant position in India’s overall infrastructure development, acting as a pivotal link between transport by land and sea.
To enhance the availability of adequate infrastructure facilities to facilitate the efficient movement of...
Hutch-Vodafone may have deep tax implications
Mergers and acquisitions are well accepted strategies for corporate growth by companies seeking to achieve economies of scale, increase market share, and diversify product range.
Many high profile mergers and acquisitions have caught our attention...
Regulations, standards could help outsourcers
Legal outsourcing in India has grown by leaps and bounds not only in the number of firms that are undertaking it but also in character of the work that is now outsourced across the...
Privatization of Indian airports – an important step
India is emerging as one of the fastest growing economies in the world and a destination for tremendous investment opportunities.
To sustain this momentum, upgradation and modernization of infrastructure; including airports is imperative.
Recognizing the importance...
Multi-level marketing is illegal, state courts say
The direct selling industry has been growing at 30% per year. Today, it has an annual revenue of about US$6 billion.
According to the Indian Direct Selling Association (IDSA) there are about 15 large companies...
Permanent establishment costly despite shutdown
Foreign companies operating in India should carefully structure their operations with an eye on the tax collector. Shutting down a permanent establishement (PE) does not necessarily allow companies to avoid taxes in India if their...
Opportunities arise as standards converge
The International Accounting Standards Board recently reported the announcement by the Council of the Institute of Chartered Accountants of India (ICAI), at its July 2007 meeting, that Indian accounting standards will achieve full convergence...
Nurturing trade secrets crucial factor in success
Every business has some unique selling propositions (USP) as the foundation stone to start, operate and compete in the market.
When that USP is analogous to a pattern, formula compilation, programme, device, method, technique, or...
Public offerings in India: Some recent developments
India’s capital markets, and consequently its capital markets regulator (that is the Securities and Exchange Board of India or “SEBI”) and its regulations, have developed at a frenetic pace in the last few years.
The...
Structuring tax efficient private equity investments
A surge of liquidity in Indian markets is giving a new lease of life to budding entrepreneurs and an opportunity for investors to invest in new markets.
In order to allow investors to retain maximum...
Bollywood, Hollywood and and IP: Law or technology?
The Indian film industry is the largest in the world, producing between 900 and 1200 films per year. This number is twice that of Hollywood, and given market demographics, still has not scratched the...
Public offer and listing of securitized debt instruments
Pursuant to the amendment of the Securities Contract (Regulation) Act, 1956 (SCRA) to include pass through certificates (PTCs), the Securities Exchange Board of India (SEBI) has released a draft of the SEBI (Public Offer...
Foreign direct investment expands retail trade
The retail trade sector in India has undergone significant transformation from small, unorganized family-owned retail units to organized retailing pursuant to the influx of international retailers in domestic markets.
Organized retail trade, predominantly concentrated in...
Indian lawyers shape up legal outsourcing market
The Indian legal process outsourcing (LPO) industry with approximately 100 service providers determining the outsourcing vendor space focuses on seven broad segments: legal transcription, document review, litigation support, legal research, intellectual property, contract related...
Clinical trials: The next big avenue for growth
The growth of the pharmaceutical industry is very much dependent on its research and development (R&D) sector.
But it is a fact that the Indian pharmaceutical industry has not traditionally attached much importance and has...
Metro projects move ahead at full steam
India has been slow in developing mass rapid transit systems (MRTS) such as metro rails, monorails and sky buses.
However, with the advent of metro rail systems in Kolkata and Delhi and the proposed metro...
Enforcing foreign judgments in India
The statutory framework for enforcement and execution in India of foreign judgments and decrees pronounced by foreign courts is provided for in the Code of Civil Procedure, 1908 (CPC).
A foreign judgment can be enforced...
If set up right, BPO units can enjoy tax holidays
Companies engaged in business processing outsourcing (BPO) activities are entitled to various tax holidays under the Income Tax Act, 1961.
Units set up by these companies in Free Trade Zones (FTZs), Electronic Hardware Technology Parks...
ECB: Looking back or looking forward?
The Government of India, Ministry of Finance and the Reserve Bank of India, the country’s central bank, have been confronted by the challenge of surging capital inflows over the past five years.
Until early 2007...
Preference shares: No longer preferable
The Companies Act, 1956 allows an Indian company to issue either equity or preferential shares. The latter get preferential treatment over equity shares.
Preference shareholders are entitled to a fixed rate of dividend to be...
Beyond outsourcing: Sustainable development
India has long been seen as the towering location for outsourcing, particularly in the area of information technology. Recently, however, cracks have begun to appear. Wage inflation for Indian IT workers has been reported...
Cabotage regulations impact shipping logistics industry
In the Indian logistics sector – comprising of packaging, storage, transport, inventories, administrative and management services of goods – transportation accounts for a quarter of total logistics costs. Maritime transport is a critical infrastructure...
Employees play their own role in corporate mergers
Sections 391 to 394 of the Companies Act, 1956 deal with schemes related to corporate reorganizations. As approval of a majority of a company’s creditors and members is a precondition for obtaining court sanction for...
The next step: Knowledge process outsourcing
Over a period of time, most of the businesses in the western world have come to include certain low priority tasks that are often delegated to third party service providers.
An example of such a...
Herald of a new era for award of damages
It may be appropriate to begin with a quote from a judgment of the Delhi High Court in Time Incorporated v Lokesh Srivastava & Anr 2005 (30) PTC 3 (Del). Interesting, equally insightful and...
Public private partnerships driving growth
Infrastructure shortages are proving a key binding constraint in sustaining and expanding India’s economic growth and making it more inclusive for the poor.
The growth of gross domestic production at over 8% has made the...
Enforcing foreign arbitral awards
The Indian Law regarding enforcement of foreign arbitration awards is contained in the Arbitration and Conciliation Act (AC Act), 1996, which incorporates provisions of the Geneva Convention of 1927 and the New York Convention...
Investing in India through a tax haven
A tax haven is a place of shelter from high income taxes and currency controls. Countries offering more advantageous tax regimes are known as tax havens.
According to the Organization for Economic Cooperation and Development...
FCCBs: Popular tools for investors
The bull run witnessed by the Indian stock markets has seen a number of issuers raise funds through Foreign Currency Convertible Bonds (FCCBs).
The term FCCBs has been defined in the FCCB Scheme to mean...
Foreign VC funds may wish to register with SEBI
The Indian media are flooded daily with explosive figures earned by venture capital investors. Increasingly, new domestic and offshore funds are being formed with a specific India and industry focus. One avenue open to...
Investing in the post 9/11 US: CFIUS reform
The United States is the largest international investor in the world and the largest destination for foreign investment.
Foreign direct investment in the United States hovered around US$50 billion per year in the early 1990s...
A new era of securitization
The securitization market in India began evolving from the mid-1990s when originators such as ICICI and Citigroup took the lead in developing it at an institutional level.
The issuance of securitization saw exponential growth from...
Development of India’s logistics industry
India is the ninth largest retail market in the world. Although this sector is still dominated by small retail players, recent times have seen large domestic and global firms launch retail projects that are...
Due diligence integral to successful M&A deals
Due diligence is a key element of any merger & acquisition (M&A) transaction.
Not only does comprehensive due diligence help investors better understand the worth of the target company, but it also generates vital information...
Ethical standards for outsourcing
Outsourcing is a subject, which stands on the pinnacle of the global chart today.
The trend of outsourcing legal work to law firms within the US has now been extended to other countries and India...
Specialized appellate board for patent appeals
The establishment of a specialized court and tribunal for intellectual property rights cases has been in demand since India’s accession to the World Trade Organization and the opening up of the Indian economy to...
The increasing attraction of wind power
The development of wind power in India has come a long way since Pandian Chemicals launched the first project in March 1990 – a 0.25mw wind power project at Kattadimalai, Tamil Nadu.
Seventeen years later,...
Strategies for effective litigation
Litigation of civil disputes in India poses unique challenges and demands creative solutions. Disputes adjudicated in courts take a long time to resolve, often resulting in huge costs and questions about whether the litigation...
Avoiding double taxation requires careful planning
Almost all agreements aimed at avoiding double taxation (DTAA) define the term permanent establishment, which is a very important concept when it comes to taxing business profits.
The term “permanent establishment” broadly refers to a...
Influx of FDI could drive real estate market
In recent years, the government has moved to promote the use of public private sector partnerships in building the country’s infrastructure and liberalize foreign direct investment (FDI) in real estate.
FDI up to 100% is...
New trends herald India’s equity boom
The 2006-07 financial year was expected to be a year of unprecedented activity in the Indian equity capital markets following the extraordinary stock market gains of the preceding three years.
The US$6 billion raised through...
ECBs: One step forward, one step back
Financing has two key components – long-term debt and short-term funds. In an ideal world, a person intending to raise debt finance would be able to raise it from any market that meets his...
Obiter Dictum
ESTABLISHED IN 2014
Total number of professionals: 10 (2 partners)
Principal office: Dhaka
Key practice areas
Labour & employment; company & commercial matters; licensing & work permits; customs, excise & VAT; civil & criminal litigation; energy disputes; legal...
