Finance Minister Nirmala Sitharaman recently presented the Union Finance Budget 2020-21. This was the minister's second budget and it had been eagerly awaited, as the government is facing immense criticism for failing to revive the slowing Indian economy. Although the finance minister's budget speech was perceived as a nod towards the possibility of significant promoter-friendly policies being introduced, on examination, it seems to represent a missed opportunity.
Over the past year, Indian private client law took a number of small steps which were potentially giant leaps for the legal regime. That is to say, although no noteworthy legislation was enacted, a number of amendments and rules were introduced to existing laws which mark a significant shift in the legal position. This article examines three key legal developments which took place in the Indian private client space in 2019 and the main trends expected in 2020.
Indian succession laws are manifold and complex. As such, an estate and succession plan should be devised for a person of Indian origin or with any Indian connection only once the applicable succession rules have been determined. This article discusses specific concepts of succession laws and provides a takeaway toolkit for practitioners faced with an estate with an Indian connection.
The Indian diaspora is one of the largest in the world, with more than 30 million people of Indian origin living outside the country. Many of these people retain some connection with India through their nationality or ownership of assets, especially real estate. Consequently, global estate and succession planning invariably involves elements of Indian succession law. Indian succession rules are complex and multi-layered and may confound offshore practitioners who encounter estates with an Indian connection.
Wealth-related disputes are common – even when family and relationships are valued over material needs. As family businesses and relationship circles get larger and more complex, parties often seek to separate commercial control, ownership and interests and achieve greater independence. This brings to the fore the significance of family settlements, which allow families to achieve these objectives amicably while preserving their values and honouring the wishes of all family members.
Following the recommendations of the Financial Action Task Force, India has introduced a statutory requirement for the identification and disclosure of significant beneficial owners, whether Indian or foreign, of every company incorporated in India. This is a landmark development which will lead to a significant push towards transparency.