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Section 234: Merger or Amalgamation of the company with Foreign Company: Companies Act, 2013

Updated: May 11


This provision deals with cross-border mergers or amalgamation. It lays down the requirements relating to the merger or amalgamation between a company incorporated in India and register under the act and a company incorporated outside India. This provision of the Companies Act, 2013 shall apply mutatis mutandis meaning making necessary changes without affecting the main point of the issue.


Following are the requirements for a cross-border merger or amalgamation:

  1. The foreign country shall be incorporated in such countries as may be notified by the Central Government.

  2. The provisions of this chapter shall apply subject to any other law for the time being in force.

  3. Additional approval from the Reserve Bank of India has to be obtained by the Central Government and the scheme of merger must be provided for the manner of payment of consideration (Cash/ depository receipts/ combination).

A foreign company may merge with a company registered in India or visa-versa. But the merger requires prior approval from RBI.

After receiving the approval from RBI and capitulating to all the requirements provided in the above-mentioned section, the concerned company can file an application with the NCLT for approval of the merger.

Note: The process of Section 234 is the same as the procedure of Section 232 read with 230. The only additional requirement under this provision is to get prior approval from the Reserve Bank of India.

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