RESERVE BANK OF INDIA
FOREIGN EXCHANGE DEPARTMENT
CENTRAL OFFICE
MUMBAI
Notification No. FEMA. 240/2012-RB
September 25, 2012
Foreign Exchange Management (Foreign Exchange
Derivative Contracts) (Second Amendment) Regulations, 2012
In exercise of the powers conferred by clause (h) of sub-section (2) of
Section 47 of the Foreign Exchange Management Act, 1999 (42 of 1999), the
Reserve Bank hereby makes the following amendments in the Foreign Exchange
Management (Foreign Exchange Derivative Contracts) Regulations, 2000
(Notification No. FEMA 25/2000-RB dated 3rd May 2000) namely:-
1. Short Title and Commencement
(i) These Regulations may be called the Foreign Exchange Management (Foreign
Exchange Derivative Contracts) (Second Amendment) Regulations, 2012.
(ii) They shall be deemed to have come in to force with effect from dates
specified in these regulations@.
2. Amendment of Schedules
In the Foreign Exchange Management (Foreign Exchange Derivative Contracts)
Regulations, 2000 (Notification No. FEMA 25/2000-RB dated 3rd May 2000),
(i) In sub-paragraph 1(f) of the paragraph 'A' in Schedule I, after the words
"in case of Global Depository Receipts (GDRs)" the words "American Depository
Receipts (ADRs)" shall be inserted and shall be deemed to have been inserted
with effect from May 3, 2000.
(ii) In sub-paragraph 3(1) of the paragraph 'B' in Schedule I, the words
"Provided that in the respect of cost effective risk reduction strategies like
range forwards, ratio-range forwards or any other variable by whatever name
called there shall not be any net inflow of premium" shall be omitted and shall
be deemed to have been omitted with effect from the 1st day of February 2011.
(iii) After sub-paragraph 3(3) of the paragraph 'B' in Schedule I, the following
new sub-paragraph shall be added and the same shall be deemed to be inserted
with effect from the 1st day of February 2011, namely :-
"(4) A person resident in India may enter into cross-currency option cost
reduction structures (not involving the rupee as one of the currencies) and
foreign currency-rupee option cost reduction structures with an authorised
dealer to hedge an exposure to exchange risk arising out of trade transactions
or external commercial borrowings subject to such terms and conditions as may be
stipulated by the Reserve Bank from time to time."
( Rudra Narayan Kar )
Chief General Manager
Footnote:-
1. @ It is clarified that no person will be adversely affected as a result of
retrospective effect being given to these regulations.
2. The Principal Regulations were published in the Official Gazette vide G.S.R.
No.411(E) dated May 8, 2000 in Part II, Section 3, sub-section (i) and
subsequently amended vide -
G.S.R.No. 756(E) dated 28.09.2000
G.S.R.No. 264(E) dated 09.04.2002
G.S.R.No. 579(E) dated 19.08.2002
G.S.R.No. 222(E) dated 18.03.2003
G.S.R.No. 532(E) dated 09.07.2003
G.S.R.No. 880(E) dated 11.11.2003
G.S.R.No. 881(E) dated 11.11.2003
G.S.R.No. 750(E) dated 28.12.2005
G.S.R.No. 222(E) dated 19.04.2006
G.S.R.No. 223(E) dated 19.04.2006
G.S.R.No. 760(E) dated 07.12.2007
G.S.R.No. 577(E) dated 05.08.2008
G.S.R.No. 440(E) dated 23.06.2009
G.S.R.No. 895(E) dated 14.12.2009
G.S.R.No. 635(E) dated 27.07.2010
G.S.R.No. ______ dated ________ and
G.S.R.No. ______ dated ________