Office Space Sharing Arrangements Between Group Companies

DIPP says if conditions imposed by it are met, Office Sharing Arrangements between Group Companies will not be construed as 'Real Estate Business' transactions - Were they ever 'Real Estate Business' transactions?

On 15 September 2015, Department of Industrial Policy and Promotion ("DIPP"), via a Circular clarified that facility sharing arrangements between group companies through leasing/ sub-leasing arrangements shall not be treated as 'Real Estate Business' under the Foreign Direct Investment ("FDI") Policy for the larger interest of business (subject to two conditions, elaborated later). This write up goes on to enunciate how this clarification will cause more problems than it solves.