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RESERVE BANK OF INDIA
FOREIGN EXCHANGE DEPARTMENT
CENTRAL OFFICE
MUMBAI 400 001
Notification No. FEMA 10 (R)/(1)/2016-RB
June 01, 2016
Foreign Exchange Management (Foreign
Currency Accounts by a person resident in India) (Amendment) Regulations, 2016
In exercise of the powers conferred by Section 9 and clause (e) of
sub-section (2) of section 47 of the Foreign Exchange Management Act, 1999 (42
of 1999), the Reserve Bank of India makes the following amendments in the
Foreign Exchange Management (Foreign Currency Accounts by a person resident in
India) Regulations, 2015 [Notification
No. FEMA 10(R)/2015-RB dated January 21, 2016], namely:
1. Short Title & Commencement:-
(i) These Regulations may be called the Foreign Exchange Management (Foreign
Currency Accounts by a person resident in India) (Amendment) Regulations, 2016.
(ii) They shall come into force from the date of publication in the official
Gazette.
2. Amendment to Regulation 5
A. The existing sub-regulation (E) shall be
re-numbered as (F).
B. In the re-numbered regulation (F), the existing
sub-regulation (3) shall be substituted by the following namely:
“Insurance/reinsurance companies registered with Insurance Regulatory and
Development Authority of India (IRDA) to carry out insurance/reinsurance
business may open, hold and maintain a Foreign Currency Account with a bank
outside India for the purpose of meeting the expenditure incidental to the
insurance/reinsurance business carried on by them and for that purpose, credit
to such account the insurance/reinsurance premia received by them outside
India.”
C. After the existing sub-regulation (D), the
following shall be inserted namely:-
“(E) Accounts in respect of Startups
An Indian startup or any other entity as may be notified by the Reserve Bank
in consultation with the Central Government, having an overseas subsidiary, may
open a foreign currency account with a bank outside India for the purpose of
crediting to it foreign exchange earnings out of exports/ sales made by the said
entity and/ or the receivables, arising out of exports/ sales, of its overseas
subsidiary.
Provided that the balances in the account shall be repatriated to India
within the period prescribed in Foreign Exchange Management (Export of Goods and
Services) Regulations, 2015 dated January 12, 2016, as amended from time to
time, for realization of export proceeds.
Explanation: For the purpose of this sub-regulation a ‘startup’ means an
entity which complies with the conditions laid down in Notification No. G.S.R
180(E) dated February 17, 2016 issued by Department of Industrial Policy and
Promotion, Ministry of Commerce and Industry, Government of India.”
3. Amendment to Schedule 1
In Paragraph 1, in sub-paragraph (1), after the existing clause (vi), the
following shall be inserted namely:-
“vii) Payments received in foreign exchange by an Indian startup, or any
other entity as may be notified by the Reserve Bank in consultation with the
Central Government, arising out of exports/ sales made by the said entity or its
overseas subsidiaries, if any.
Explanation: For the purpose of this schedule a ‘startup’ means an entity
which complies with the conditions laid down in Notification No. G.S.R 180(E)
dated February 17, 2016 issued by Department of Industrial Policy and Promotion,
Ministry of Commerce and Industry, Government of India.”
(J. K. Pandey)
General Manager (Officer- in- charge)
Foot Note:-
The Principal Regulations were published in the Official Gazette vide G.S.R.
No.96 (E) dated January 21, 2016 in Part II, Section 3, sub-Section (i).
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