To promote ease of doing business for both domestic entities, in the international market, and foreign entities, in the domestic market, the Ministry of Finance has issued Foreign Exchange Management (Non-Debt Instrument) (Fourth Amendment) Rules, 2024 on 16th August 2024 permitting swap of equity instruments of Indian companies with equity instrument of foreign companies. In […]

FEMA or Foreign Exchange Management Act was presented by the central government of India in 1999. It is a regulatory act to welcome and support international payments and trading across the border. FEMA was mainly introduced as a replacement for the FERA or Foreign Exchange Regulation Act. FEMA was also designed to rectify the sundry […]

The flow of cash, services, and products over borders has become smoother in the modern globalized economy. Businesses must, however, negotiate a complicated web of laws and regulatory requirements that come with globalization. Following the rules established by the Foreign Exchange Management Act (FEMA) and the Reserve Bank of India (RBI) is legally required and […]

The operations of the Reserve Bank of India and FEMA are quite intricate, making it very challenging for firms and individuals to conduct business legally. Adherence to these regulations is equally important, but monitoring the constant changes in the rules and regulations can be a daunting task. That is exactly where our RBI/FEMA Expert Advisory […]

In the dynamic world of international trade, navigating the ever-evolving landscape of financial regulations can feel like walking a tightrope. In India, the Reserve Bank of India (RBI) and the Foreign Exchange Management Act (FEMA) play a critical role in regulating foreign exchange transactions and fostering financial stability. Understanding and complying with these regulations is […]

The Appellant filed an appeal before the SEFEMA against the impugned order wherein a penalty of INR 50 Lakhs was imposed on the Appellant for violation of provisions of FEMA. After filing appeal, the Appellant kept on seeking adjournment from the Tribunal and filed the writ Petitioner before the High Court of Calcutta. While filing writ petition, the appellant suppressed the fact of pendency of appeal. Hon’ble High Court rejected the contention of the Appellant and upheld the impugned order. The High Court mentioned The impugned order is appealable. The petitioner has chosen not to prefer an appeal. The Petitioner chose to file the writ petition.

The Appellant, an Indian Company, received FDI of INR 204 Crores through automatic approval route. The Company was required to file the Advance Remittance Form (ARF) within 30 days of receipt of FDI. The Company delayed in reporting of FDI to RBI by 24 days. Therefore, the penalty was imposed on the company of INR 20 Crores and on the directors of INR 5 Crores.

The Appellant exported 12 shipments and realised export proceeds for only 1 shipment out of 12 shipments. The Special Director, Enforcement Directorate imposed a penalty of INR 70 lakhs and INR 20 Lakhs on the appellant for contravention of Section 7 & 8 of FEMA, 1999. The appellant took all the reasonable steps to realise the export proceeds such as loding a complaint with Export Credit Guarantee Corporation (ECGC), Indian High Commission at Singapore, M/s Allen Gledhill Singapore the debt collecting agency and M/s Omega Alliance, Mumbai for debt collection. However, still could not realise export proceeds.

Similar to Foreign Direct Investment, Foreign Portfolio Investment (FPI) is a most explored way of investment in India. Foreign Portfolio Investment allows an investor to invest in multiple securities in foreign country such as shares, bonds, fixed deposits etc. Unlike FDI, investment in FPI is done for the purpose of getting return and not for the purpose of control. FPI is controlled in India through Security and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2014.

India is showing substantial development in the space sector. Considering the major development of India in the space sector, the government has approved amendments in FDI policies with respect to FDI in space sector.