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The key points are:
[1] FEMA was introduced to facilitate external trade and payments and promote an orderly foreign exchange market following economic liberalization in 1991.
[2] FEMA regulates specified foreign exchange transactions, whereas FERA controlled anything related to foreign exchange.
[3] FEMA's objective is to facilitate trade, while FERA aimed to prevent misuse of foreign exchange.
The key points are:
[1] FEMA was introduced to facilitate external trade and payments and promote an orderly foreign exchange market following economic liberalization in 1991.
[2] FEMA regulates specified foreign exchange transactions, whereas FERA controlled anything related to foreign exchange.
[3] FEMA's objective is to facilitate trade, while FERA aimed to prevent misuse of foreign exchange.
Copyright:
Attribution Non-Commercial (BY-NC)
Verfügbare Formate
Als PPT, PDF, TXT herunterladen oder online auf Scribd lesen
The key points are:
[1] FEMA was introduced to facilitate external trade and payments and promote an orderly foreign exchange market following economic liberalization in 1991.
[2] FEMA regulates specified foreign exchange transactions, whereas FERA controlled anything related to foreign exchange.
[3] FEMA's objective is to facilitate trade, while FERA aimed to prevent misuse of foreign exchange.
Copyright:
Attribution Non-Commercial (BY-NC)
Verfügbare Formate
Als PPT, PDF, TXT herunterladen oder online auf Scribd lesen
• Objectives To facilitate external trade and payments To promote the orderly development and maintenance of foreign exchange market
FEMA Prof. Parul Gupta 2
• Introduction: - Foreign exchange transactions were regulated by Foreign exchange regulation act (FERA), 1973 Following the liberalization ushered in 1991 some amendments were made to FERA in 1993 there was a lot demand to bring certain major changes in FERA in the light of economic changes took place Consequently a new act was formed to replace FERA, known as Foreign exchange management act (FEMA), 1999
FEMA Prof. Parul Gupta 3
Section 3 of FEMA
It talks about dealings in foreign exchange and foreign
securities and payments to and receipts from any person outside India.
The general or special permission of the Reserve Bank of India
is required in the following matters
(a)Dealing in any foreign exchange or foreign security with any
person other than the authorized person
(b) Payment to or for the credit of any person resident outside
resident outside India in any manner otherwise through an authorized person
(d) Enter in to any financial transaction in India as a
consideration for or in. association with requisition or creation or transfer of a right to acquire any asset outside India by any person FEMA Prof. Parul Gupta 4 Holding of Foreign Exchange:- No person resident in India shall acquire, hold, own, possess or transfer any foreign exchange/foreign security or any immovable property situated outside India
Current account Transactions:-
-Act permits dealing in foreign exchange through authorized persons for current account transactions. -Central Government can impose reasonable restrictions in public interest with this regard FEMA Prof. Parul Gupta 5 Capital Account Transactions: - Any person may sell or draw foreign exchange to or from an authorized person for a capital account transaction permitted by RBI in consultation with central Government . RBI prohibits, restricts or regulate the following,
(a) Transfer or issue of any foreign security by a person
(e) Any borrowing or lending in rupees in whatever form or whatever name called between a person resident in India and a person resident outside India; (f) Deposits between persons resident in India and a person resident outside India (g) Export, Import or holding of currency or currency notes (h) Transfer of immovable property outside India other than a lease not exceeding five years by a person resident outside India (i) Acquisition or transfer of immovable property in India other than a lease not exceeding five years by a person resident outside India (j) Giving of guarantee or surety in respect of any debt obligation or the liability 1. By a person resident in India and owed to a person resident outside India or 2. By a person resident outside India FEMA Prof. Parul Gupta 7 Export of goods and services Every exporter of goods shall famish to the RBI or to such other authority the following
(a)A declaration specified
1. True and correct material particulars 2. Amount representing the value of full export of goods 3. The time of the export 4. The value which exporter having regard to the prevailing market conditions expects to receive on the sale of the goods in a market outside India
(b) Other information
-That may be required by RBI for the purpose of ensuring the realization of the export proceeds by such exporter - Every exporter of the services shall furnish to the RBI or to such other authorities a declaration as specified, containing the true and correct material particulars in relation to the payment for such services
FEMA Prof. Parul Gupta 8
Realization and Repatriation of foreign exchange:- Any person in this concern shall have to follow the reasonable steps to realize and repatriate it to India with or with in the time in the manner prescribed by the act
Contravention and penal ties:-
• For any kind of contravention under this act defaulter is liable to pay up to thrice the amount involved where it is quantifiable Up to Rs. 2 lakhs Where not quantifiable • If such contravention is continued further penalty which may extend to Rs. 5,000 for every day after the first day FEMA Prof. Parul Gupta 9 Administration of the Act
- The rules regulations and norms pertaining to many sections are
laid down by RBI in consultation with central Government.
- The Act requires central Government to appoint,
• Adjudicating Authorities for holding enquires related to the contravention of the Act • one or more Special Directors (appeals) to hear appeals against the order of the Adjudicating authorities
- Central Government shall have to establish
1. An Appellate Tribunal for foreign Exchange to hear appeals against the order of the Adjudicating Authorities and the Special Directors 2. A Director of Enforcement with a Director and such officers or class of officers as it thinks fit for taking up for investigation the contravention under this Act
FEMA Prof. Parul Gupta 10
FERA V/s FEMA:- 1. In FEMA only the specified acts related to foreign exchange are regulated while in FERA anything and everything that has to do with foreign exchange was controlled
2. The objective of FEMA is to facilitate trade while