RBI/2008-09/332
A. P. (DIR Series) Circular No. 43
December 26, 2008
To,
All Authorised Dealer Category - I Banks
Madam / Sir,
Settlement system under ACU Mechanism
Attention of Authorised Dealer Category - I (AD Category - I) banks is invited
to Article IV (b) and (c) of the General Provisions of Agreement establishing
the Asian Clearing Union for channelling transactions through the Asian Clearing
Union (ACU) in terms of which, the Asian Monetary Unit is denominated as "ACU
Dollar" and Regulations 3 and 5 of Notification No. FEMA 14/2000-RB dated May 3,
2000 [Foreign Exchange Management (Manner of Receipt and Payment) Regulations,
2000], as amended from time to time.
- In order to facilitate transactions / settlements, effective January 01,
2009, participants in the Asian Clearing Union will have the option to settle
their transactions either in ACU Dollar or in ACU Euro. Accordingly, the Asian
Monetary Unit (AMU) shall be denominated as 'ACU Dollar' and 'ACU Euro' which
shall be equivalent in value to one US Dollar and one Euro, respectively.
- Further, AD Category – I banks are allowed to open and maintain ACU Dollar
and ACU Euro accounts with their correspondent banks in other participating
countries. All eligible payments are required to be settled by the concerned
banks through these accounts.
- Necessary amendments to the Foreign Exchange Management (Manner of Receipt
and Payment) Regulations, 2000 and Memorandum of Procedure for Channelling
Transactions through Asian Clearing Union (ACU) [Memorandum ACM] are being
issued separately.
- AD Category – I banks may bring the contents of this circular to the notice
of their constituents concerned.
- The directions contained in this circular has been issued under sections
10(4) and 11(1) of the Foreign Exchange Management Act (FEMA), 1999 (42 of 1999)
and is without prejudice to permissions / approvals, if any, required under any
other law.
Yours faithfully,
(D. Mishra)
Chief General Manager