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RBI/2016-17/8
A.P. (DIR Series) Circular No. 1
July 07, 2016
To
All Category - I Authorised Dealer Banks
Madam/Sir,
Discontinuation of Reporting of Bank Guarantee on
behalf of service importers
Attention of Authorised Dealer Category-I (AD Category-I) banks is invited to
para no. 5 of the Master Direction No.8 dated January 01, 2016 on ‘Other
Remittance Facilities’ in terms of which, AD Category-I banks were permitted to
issue guarantees in favour of a non-resident service provider on behalf of their
resident customers importing services, subject to the conditions laid therein.
AD Category-I banks were also advised vide para no.1, Part X of the Master
Direction on ‘Reporting under Foreign Exchange Management Act, 1999’ dated
January 1, 2016, to report to the Chief General Manager-in- Charge, Foreign
Exchange Department, Foreign Investments Division (EPD), Reserve Bank of India,
Central Office, Mumbai-400001 details about invocation of bank guarantee for
service imports.
2. On a review of the reporting requirements and to reduce the burden of
compliance, AD Category I banks are advised to discontinue submission of such
reports with immediate effect. They may, however, maintain records of such
invocations and furnish the required details to RBI whenever sought.
3. The Master Direction No. 18 dated January 01, 2016 is being updated to
reflect the changes.
4. The directions contained in this circular have been issued under Section
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,
(Shekhar Bhatnagar)
Chief General Manager-in- charge
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