RESERVE BANK OF INDIA
FOREIGN EXCHANGE DEPARTMENT
CENTRAL OFFICE
MUMBAI 400 001
Notification No. FEMA 13(R)/2016-RB
April 01, 2016
Foreign Exchange Management (Remittance of Assets) Regulations, 2016
In exercise of the powers conferred by Section 47 of the Foreign Exchange
Management Act, 1999 (42 of 1999) and in supersession of Notification
No. FEMA
13/2000-RB dated May 3, 2000, as amended from time to time, the Reserve Bank
makes the following regulations in respect of remittance outside India by a
person whether resident in India or not, of assets in India, namely:
1. Short title and commencement:-
- These Regulations may be called the Foreign Exchange Management (Remittance of
Assets) Regulations, 2016.
- They shall come into force from the date of their publication in the official
Gazette.
2. Definitions:-
In these Regulations, unless the context requires otherwise, -
- 'Act' means the Foreign Exchange Management Act, 1999 (42 of 1999);
- 'Authorised Dealer' means a person authorised as an authorised dealer under
subsection (1) of section 10 of the Act;
- 'Non-Resident Indian’ (NRI) shall have the same meaning assigned under the
Foreign Exchange Management (Deposit) Regulations, 2016;
- ‘Person of Indian Origin’ (PIO) shall have the same meaning assigned under
the Foreign Exchange Management (Deposit) Regulations, 2016;
- 'Remittance of asset' means remittance outside India of funds representing a
deposit with a bank or a firm or a company, provident fund balance or
superannuation benefits, amount of claim or maturity proceeds of Insurance
policy, sale proceeds of shares, securities, immovable property or any other
asset held in India in accordance with the provisions of the Act or rules or
regulations made there under;
- the words and expressions used but not defined in these Regulations shall
have the same meanings respectively assigned to them in the Act.
3. Prohibition on Remittance outside India of assets held in India:-
Save as otherwise provided in the Act or rules or regulations made or issued
thereunder, no person, whether resident in India or not, shall make remittance
of any asset held in India by him or by any other person:
Provided that the Reserve Bank may, for sufficient reasons, permit any person to
make remittance of any asset held in India by him or by any other person.
4. Permission for remittance of assets in certain cases:-
(1) A citizen of foreign state, not being a Person of Indian origin (PIO) or a
citizen of Nepal or Bhutan, who
- has retired from an employment in India, or
- has inherited the assets from a person referred to in sub-section (5) of
section 6 of the Act; or
- is a widow/ widower resident outside India and has inherited assets of the
deceased spouse who was an Indian citizen resident in India, may remit through
an authorised dealer an amount, not exceeding USD 1,000,000 (US Dollar One
million only) per financial year on production of documentary evidence in
support of acquisition, inheritance or legacy of assets by the remitter
Provided that for the purpose of arriving at annual ceiling of remittance, the
funds representing sale proceeds of shares and immovable property owned or held
by the citizen of foreign state on repatriation basis in accordance with the
Foreign Exchange Management (Acquisition and transfer of immovable property in
India) Regulations, 2016 and Foreign Exchange Management (Transfer or issue of
security by a person resident outside India) Regulations, 2000 made under the
Act, shall not be included.
Provided further that where the remittance is made in more than one instalment,
the remittance of all instalments shall be made through the same authorised
dealer.
(iv) had come to India for studies/ training and has completed his studies/
training, may remit the balance available in his account, provided such balance
represents funds derived out of remittances received from abroad through normal
banking channels or rupee proceeds of foreign exchange brought by such person
and sold to an authorised dealer or out of stipend/ scholarship received from
the Government or any Organisation in India.
(2) A Non-Resident Indian (NRI) or a Person of Indian Origin (PIO) may remit
through an authorised dealer an amount, not exceeding USD 1,000,000 (US Dollar
One million only) per financial year,
(i) out of the balances held in the Non-Resident (Ordinary) Accounts (NRO
accounts) opened in terms of Foreign Exchange Management (Deposit) Regulations,
2016/ sale proceeds of assets/ the assets acquired by him by way of inheritance/
legacy on production of documentary evidence in support of acquisition,
inheritance or legacy of assets by the remitter;
(ii) Under a deed of settlement made by either of his parents or a relative
(relative as defined in Section 2(77) of the Companies Act, 2013) and the
settlement taking effect on the death of the settler, on production of the
original deed of settlement;
Provided that where the remittance under Clause (i) and (ii) is made in more
than one instalment, the remittance of all instalments shall be made through the
same Authorised Dealer.
Provided further that where the remittance is to be made from the balances held
in the NRO account, the account holder shall furnish an undertaking to the
Authorised Dealer that “the said remittance is sought to be made out of the
remitter’s balances held in the account arising from his/ her legitimate
receivables in India and not by borrowing from any other person or a transfer
from any other NRO account and if such is found to be the case, the account
holder will render himself/ herself liable for penal action under FEMA.”
(3) An authorised dealer in India may, also allow remittance out of the assets
of Indian companies under liquidation under the provisions of the Companies Act,
2013, subject to the following conditions:
(i) Authorised Dealer shall ensure that the remittance is in compliance with the
order issued by a court in India/ order issued by the official liquidator or the
liquidator in the case of voluntary winding up; and
(ii) no remittance shall be allowed unless the applicant submits:-
Auditor's certificate confirming that all liabilities in India have been either
fully paid or adequately provided for.
Auditor's certificate to the effect that the winding up is in accordance with
the provisions of the Companies Act, 2013.
In case of winding up otherwise than by a court, an auditor's certificate to the
effect that there is no legal proceedings pending in any court in India against
the applicant or the company under liquidation and there is no legal impediment
in permitting the remittance.
5. Permission to an Indian entity to remit funds in certain cases:-
(1) An entity in India may remit the amount being its contribution towards the
provident fund/ superannuation/ pension fund in respect of the expatriate staff
in its employment who are resident in India but not permanently resident
therein.
Explanation:
For the purpose of this Regulation, -
- 'expatriate staff' means a person whose provident/ superannuation/ pension
fund is maintained outside India by his principal employer outside India;
- ‘not permanently resident' means a person resident in India for employment
of a specified duration (irrespective of length thereof) or for a specific job
or assignment, the duration of which does not exceed three years.
6. Permission for remittance of assets on closure or remittance of winding up
proceeds of branch office/ liaison office (other than project office)
(1) A branch or office established in India by a person resident outside India
may, for making remittance of assets on closure or remittance of its winding up
proceeds, apply to the Authorised Dealer concerned supported by the following
documents, namely:
- A copy of the Reserve Bank's permission for establishing the branch/ office
in India, wherever applicable;
- Auditor’s certificate:
indicating the manner in which the remittable amount has been arrived and
supported by a statement of assets and liabilities of the applicant, and
indicating the manner of disposal of assets;
confirming that all liabilities in India including arrears of gratuity and other
benefits to the employees etc., of the branch/ office have been either fully met
or adequately provided for;
confirming that no income accruing from sources outside India (including
proceeds of exports) has remained un-repatriated to India; and
confirming that the branch/office has complied with all regulatory requirements
stipulated by the Reserve Bank of India from time to time regarding functioning
of such offices in India.
- A confirmation from the applicant that no legal proceedings are pending in
any Court in India and there is no legal impediment to the remittance; and
- A report from the Registrar of Companies regarding compliance with the
provisions of the Companies Act, 2013, in case of winding up of the office in
India.
(2) On consideration of the application made under sub-regulation (1), the
authorized dealer concerned may permit the remittance subject to the directions
issued by the Reserve Bank in this regard, from time to time.
7. Reserve Bank's prior permission in certain cases:-
(1) A person who desires to make a remittance of assets in the following cases,
may apply to the Reserve Bank, namely:
(i) Remittance exceeding USD 1,000,000 (US Dollar One million only) per
financial year –
on account of legacy, bequest or inheritance to a citizen of foreign state,
resident outside India; and
by a Non-Resident Indian (NRI) or Person of Indian Origin (PIO), out of the
balances held in NRO accounts/ sale proceeds of assets/ the assets acquired by
way of inheritance/ legacy.
(ii) Remittance to a person resident outside India on the ground that hardship
will be caused to such a person if remittance from India is not made;
(2) On consideration of the application made under sub-regulation (1), the
Reserve Bank may permit the remittance, subject to such terms and conditions as
it deem necessary.
8. Payment of taxes:-
Any transaction involving remittance of assets under these regulations shall
be subject to the applicable tax laws in India.
(Shekhar Bhatnagar)
Chief General Manager-in-charge
Published in the Official Gazette of Government of India –
Extraordinary – Part-II, Section 3, Sub-Section (i) dated 01.04.2016-
G.S.R.No.388(E)
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