Sec. 2 (1) (ra) of the Prevention of Money Laundering Act, 2002 (http://fiuindia.gov.in/pmlasection2.htm ), answers the question regarding the applicability of the Prevention of Money Laundering Act, 2002 (PMLA) on a Foreign Subsidiary of an Indian company.
Sec. 2 (1) (ra) of the PMLA, while defining the “offence of cross border implications”, answers the question above, as—
- any conduct by a person
- at a place outside India
- which constitutes an offence at that place outside India,
- which would have constituted an offence specified in Part A, Part B or Part C of the Schedule of PMLA,
- had it been committed in India,
- if such person
- transfers in any manner
- the proceeds of such conduct or part thereof to India;
any offence specified in Part A, Part B or Part C of the Schedule of PMLA
- which has been committed in India,
- the proceeds of crime, or part thereof
- have been transferred to a place outside India,
- any attempt has been made to
- transfer the proceeds of crime, or part thereof
- from India
- to a place outside India.
So, PMLA would be applicable on a subsidiary of an Indian Co., located at overseas jurisdiction, provided the ingredients of the above offence related to cross border transaction are applicable.