The Reserve Bank of India, RBI on Monday said that Indian companies will require to obtain its prior permission to open, hold and maintain foreign currency account -FCA abroad for the purpose of overseas direct investments.

The RBI has issued a notification to this effect. According to the notification, the host country regulations stipulate that the investments into the country is required to be routed through a designated account and FCA should be opened, held and maintained as per the regulation.

It said that the remittances sent to the FCA by the Indian company should be utilised only for making overseas direct investment into the joint venture or wholly-owned subsidiaries abroad.

The Indian company should also submit the details of debits and credits in the FCA on yearly basis to the designated bank with a certificate from the statutory auditors, certifying that the FCA was maintained as per the host country laws.