Date: |
04-02-2016
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Notification No: |
RBI/2015-16/308 A.P. (DIR Series) Circular No. 43
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Issuing Authority: |
RBI
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Type: |
A.P.D.(Series) Circulars
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File No: |
RBI/2015-16/308 |
Subject: |
Foreign Exchange Management (Acquisition and Transfer of Immovable Property outside India) Regulations, 2015
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RBI/2015-16/308
A.P. (DIR Series) Circular No. 43/2015-16 [(1)/7(R)]
February 04th 2016
To
All Category - I Authorised Dealer and Authorised Banks
Madam/ Sir
Foreign Exchange Management (Acquisition and Transfer of Immovable
Property outside India) Regulations, 2015
Attention of Authorised Dealers (ADs) is invited to A.D.(M.A. Series)
Circular No. 11 dated May 16, 2000 in terms of which ADs were advised of various
Rules, Regulations, Notifications/ Directions issued under the Foreign Exchange
Management Act, 1999 (hereinafter referred to as the Act). On a review it is
felt necessary to revise the regulations issued under the Foreign Exchange
Management (Acquisition and Transfer of Immovable Property outside India)
Regulations, 2000, as amended from time to time. Accordingly, in consultation
with the Government of India, the said regulations have been repealed and
replaced by the Foreign Exchange Management (Acquisition and Transfer of
Immovable Property outside India) Regulations, 2015.
- In terms of these Regulations, acquisition or transfer of any
immovable property outside India by a person resident in India would require
prior approval of Reserve Bank except in the following cases:
- Property held outside India by a foreign citizen resident in India;
- Property acquired by a person on or before 8th July, 1947 and held with
the permission of Reserve Bank;
- Property acquired by way of gift or inheritance from:
persons referred to in (b) above;
persons referred to in section 6(4) of the Act;
- Property purchased out of funds held in Resident Foreign Currency (RFC)
account held in accordance with the Foreign Exchange Management (Foreign
Currency Accounts by a person resident in India) Regulations, 2015;
- Property acquired jointly with a relative who is a person resident
outside India provided there is no outflow of funds from India;
- Property acquired by way of inheritance or gift from a person resident in
India who acquired such property in accordance with the foreign exchange
provisions in force at the time of such acquisition
- An Indian company having overseas offices may acquire immovable property
outside India for its business and residential purposes provided total
remittances do not exceed the following limits prescribed for initial and
recurring expenses, respectively:
- 15 per cent of the average annual sales/ income or turnover of the Indian
entity during the last two financial years or up to 25 per cent of the net
worth, whichever is higher;
- 10 per cent of the average annual sales/ income or turnover during the
last two financial years.
- For the purpose of these regulations, 'relative' in relation to an
individual means husband, wife, brother or sister or any lineal ascendant or
descendant of that individual.
- The new regulations have been notified vide
Notification No. FEMA
07(R)/2015-RB dated January 21, 2016 c.f. G.S.R. No. 95(E) dated January 21,
2016 and shall come into force with effect from January 21, 2016. The Master
Direction No. 12 of 2015-16 (Acquisition and Transfer of Immovable Property
under Foreign Exchange Management Act, 1999) has been updated accordingly to
incorporate the above changes.
- AD Category- I banks may bring the contents of the circular to the notice
of their constituents concerned.
- The directions contained in this circular have been issued under Sections
10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999)
and are without prejudice to permissions/ approvals, if any, required under
any other law.
Yours faithfully
(B. P. Kanungo)
Principal Chief General Manager
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