Singapore Court Clears Pine Labs’ Move to Shift Domicile to India

Pine Labs, a prominent player in the payments industry, has received approval from a Singapore court to merge its domestic and Singapore entities, according to regulatory filings. This crucial step marks progress in Pine Labs’ endeavor to relocate its domicile back to India, pending approval on the Indian front.

The initiative by Pine Labs, as reported by ET on March 20, involves filings in both India and Singapore for a reverse merger, a move that has garnered attention and interest from industry observers. Pine Labs’ successful clearance in Singapore sets a precedent for other Indian-origin companies headquartered abroad, with several closely monitoring the process.

The positive sentiment towards Indian markets has spurred a trend of “reverse flips,” where companies are relocating their domiciles to India. Walmart-owned Flipkart is reportedly considering a similar move from Singapore, indicating a broader shift among major players in the Indian business landscape. Notably, companies like Meesho, Razorpay, Zepto, and Udaan are also progressing through various stages of the process, while PhonePe and Groww have already completed their migration.

However, Pine Labs’ transition awaits approval from the National Company Law Tribunal (NCLT) in India, a process that typically involves a longer timeline. Despite the pending NCLT approval, industry analysts see Pine Labs’ progress as a positive development for Indian companies aiming to realign their domicile with India’s favorable business environment.

The tax implications of Pine Labs’ move remain uncertain, with similar companies grappling with tax assessments both domestically and abroad. While Razorpay anticipates a significant tax payout in the US, PhonePe’s migration resulted in substantial tax payments by its parent company, Walmart, to the Indian government.

Pine Labs, backed by investors such as Peak XV Partners, has garnered significant funding since its inception in 1998. While initially considering a public listing overseas, the company postponed its IPO plans due to volatile market conditions. The trend of Indian-origin startups relocating to India reflects the country’s growing appeal as a vibrant market amid global uncertainties.

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