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ARTICLE · 03 MAY 2017

Employee Share Plans In India: Regulatory Overview

Kochhar & Co.
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It is quite common for employees of companies in certain industries (for example, information technology) to be offered employee share plans.

IndiaEmployment and HR
Stephen Mathias
Stephen Mathias
Ajay Prasad
Ajay Prasad
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EMPLOYEE PARTICIPATION

1. Is it common for employees to be offered participation in an employee share plan?

It is quite common for employees of companies in certain industries (for example, information technology) to be offered employee share plans. It has also become quite common for start-up companies to offer share plans, regardless of the sector in which they operate. It is not common for manufacturing companies to offer share plans.

2. Can employees be offered a share plan where the shares to be acquired are in a foreign parent company?

A foreign company can offer share plans to both:

  • Employees of its branch offices or subsidiaries in India.
  • Employees of companies in India in which the foreign company holds shares. The shares can be held directly or through a special purpose vehicle.

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