Rule 88 — Eligible international transactions for safe…

Rule 88 lists the eligible international transactions between an eligible assessee and its associated enterprise, one of which must be a non-resident: IT services, intra-group loans, corporate guarantees up to a limit or to well-rated enterprises, generic drug R&D, auto components, low value-adding group services and data centre services.

The rule. An "eligible international transaction" is an international transaction between the eligible assessee and its associated enterprise, one of which is necessarily a non-resident, comprising:

(a) provision of information technology services (software development, IT enabled services, knowledge process outsourcing, or contract research and development relating wholly or partly to software development);
(b) advance of an intra-group loan;
(c) provision of a corporate guarantee, where the amount guaranteed does not exceed one hundred crore rupees, or exceeds that and the associated enterprise has a credit rating, by a SEBI-registered agency, of adequate to highest safety;
(d) provision of contract research and development services, wholly or partly relating to generic pharmaceutical drugs;
(e) manufacture and export of core auto components;
(f) manufacture and export of non-core auto components;
(g) receipt of low value-adding intra-group services from group members; or
(h) provision of data centre services.

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Eligible international transactions for safe harbour