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Foreign exchange management act

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Foreign exchange management act

  1. 1. RAVI SHEKHAR (MBA 1 SEM) 1
  2. 2. RAVI SHEKHAR (MBA) GICTS GWALIOR
  3. 3. (FERA) was passed by the IndianParliament in 1973 by the governmentof Indira Gandhi and came into force witheffect from January 1, 1974. FERA imposedstringent regulations on certain kinds ofpayments, the dealings in foreign exchangeand securities and the transactions whichhad an indirect impact on the foreignexchange and the import and export ofcurrency. RAVI SHEKHAR (MBA 1 SEM) 3
  4. 4. WHAT IS FEMA?• The Foreign Exchange Management Act (FEMA) was an act passed in the winter session of Parliament in 1999 which replaced Foreign Exchange Regulation Act. This act seeks to make offenses related to foreign exchange civil offenses. It extends to the whole of India.[ RAVI SHEKHAR (MBA 1 SEM) 4
  5. 5. Investing in India Government Route Automatic Route (FIPB) General Rule No prior Permission RequiredOnly informing RBI within 30 days Prior Permission Required of issue and reciept of funds MAHESHWARI & CO. Advocates & Legal Consultants 5
  6. 6. FERA & FEMA• Object to conserve • To facilitate external and prevent misuse. trade and payment.• It was a draconian • It is a civil law. police law. 6
  7. 7. OBJECTIVES• The objectives 0f FEMA are : To facilitate external trade and payments. To promote the orderly development and maintenance of foreign exchange market RAVI SHEKHAR (MBA 1 SEM) 7
  8. 8. Dealing in foreign exchange, ACT.• (a) transfer any foreign exchange or foreign security to any person not being an authorized person;• (b) make any payment to or for the credit of any person resident outside India in any manner;• (c) receive otherwise through an authorized person, any payment by order or on behalf of any person resident outside India in any manner. RAVI SHEKHAR (MBA 1 SEM) 8
  9. 9. Current Account Transactions• Any person may sell or draw foreign exchange to or from an authorized person if such sale or drawl is a current account transaction.• The Central Government may, in public interest and in consultation with the Reserve Bank, impose such reasonable restrictions for current account transactions as may be required from time to time. 9
  10. 10. Capital account transactionsTransfer or issue of any foreign security by a person resident in India.Deposit between persons resident in India and person resident outside India.Any person may sell or draw foreign exchange to or from an authorised person for a capital account transaction permitted by the RBI in consultation restrictions in public interest. RAVI SHEKHAR (MBA 1 SEM) 10
  11. 11. Holding of foreign exchange, ACT• Save as otherwise provided in this Act, no person resident in.• India shall acquire, hold, own, possess or transfer any foreign exchange, foreign security or any immovable property situated outside India. RAVI SHEKHAR (MBA 1 SEM) 11
  12. 12. Export of goods and services(1) The Reserve Bank may, for the purpose of ensuring that the full export value of the goods or such reduced value of the goods as the Reserve Bank determines, having regard to the prevailing market conditions, is received without any delay, direct any exporter to comply with such requirements as it deems fit. RAVI SHEKHAR (MBA 1 SEM) 12
  13. 13. Export of goods and services conti……… • (2) Every exporter of services shall furnish to the Reserve Bank or to such other authorities a declaration in such form and in such manner as may be specified, containing the true and correct material particulars in relation to payment for such services RAVI SHEKHAR (MBA 1 SEM) 13
  14. 14. , RAVI SHEKHAR (MBA 1 SEM) 14
  15. 15. RAVI SHEKHAR (MBA 1 SEM) 15
  16. 16. RAVI SHEKHAR (MBA 1 SEM) 16

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