What is a RBI Compliances?
RBI is nation’s central bank for monetary, foreign exchange, government debt management and financial regulation, currency management and acting as banker to banks and to the government.
The Reserve Bank oversees the foreign exchange market in India. It supervises and regulates it through the provisions of the Foreign Exchange Management Act, 1999. . The statutory power for exchange control was provided by the Foreign Exchange Regulation Act (FERA) of 1947, which was subsequently replaced by a more comprehensive Foreign Exchange Regulation Act, 1973.
This Act empowered the Reserve Bank, and in certain cases the Central Government, to control and regulate dealings in foreign exchange payments outside India, export and import of currency notes and bullion, transfer of securities between residents and non-residents, acquisition of foreign securities, and acquisition of immovable property in and outside India, among other transactions.
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Reporting of Advanced Remittance Form (ARF to RBI)
An Indian company which has received amount of consideration for issue of capital instruments and where such issue is reckoned as Foreign Direct Investment for the purpose of these regulations, shall report such receipt (including each upfront/ call payment) in ARF to the Regional Office concerned of the Reserve Bank, not later than 30 days from the date of receipt.
- NRI KYC
- FIRC (Foreign Inward Remittance Certificate)
Reporting of FC-GPR
An Indian company issuing capital instruments to a person resident outside India and where such issue is reckoned as Foreign Direct Investment, has to issue the same within 60 days from the date of receipt of amount of consideration and shall report such issue in Form FC-GPR to the Regional Office concerned of the Reserve Bank under whose jurisdiction the Registered office of the company operates, not later than thirty days from the date of issue of capital instruments. Issue of ‘participating interest/ rights’ in oil fields shall be reported in Form FC-GPR.
- CS Certificate
- Passing of Board Resolution
- Valuation Report by Practicing Chartered Accountant
Overseas Direct Investment (ODI)
Direct investment outside India means investments, either under the Automatic Route or the Approval Route, by way of contribution to the capital or subscription to the Memorandum of a foreign entity or by way of purchase of existing shares of a foreign entity either by market purchase or private placement or through stock exchange, signifying a long-term interest in the foreign entity (JV or WOS).
Annual Performance Report (APR)
It is the obligation of the Indian Party (IP) / Resident Individual (RI), which has set up / acquired a JV or WOS overseas in terms of the Regulations of the Notification ibid, shall submit, to the designated Authorised Dealer (AD) every year, an APR in Form ODI Part II in respect of each JV or WOS outside India and other reports or documents as may be specified by the Reserve Bank from time to time, on or before the 31st of December each year. The APR, so required to be submitted, has to be based on the latest audited annual accounts of the JV / WOS, unless specifically exempted by the Reserve Bank.
Reporting of FC-TRS
Form FCTRS shall be filed for transfer of capital instruments between:
- a person resident outside India holding capital instruments in an Indian company on a repatriable basis and person resident outside India holding capital instruments on a non repatriable basis; and
- a person resident outside India holding capital instruments in an Indian company on a repatriable basis and a person resident in India, The onus of reporting shall be on the resident transferor/ transferee or the person resident outside India holding capital instruments on a non-repatriable basis, as the case may be. Note: Transfer of capital instruments in accordance with these Regulations by way of sale between a person resident outside India holding capital instruments on a non-repatriable basis and person resident in India is not required to be reported in Form FC-TRS. Transfer of capital instruments on a recognized stock exchange by a person resident outside India shall be reported by such person in Form FC-TRS to the Authorized Dealer bank. Transfer of capital instruments prescribed in regulation 10(9) of FEMA 20(R), shall be reported in Form FC-TRS to the Authorized Dealer on receipt of every tranche of payment. The onus of reporting shall be on the resident transferor/ transferee. Transfer of ‘participating interest/ rights’ in oil fields shall be reported Form FC-TRS. The form FCTRS shall be filed with the Authorized Dealer bank within sixty days of transfer of capital instruments or receipt/ remittance of funds whichever is earlier.
- NRI KYC
- Valuation Report by Practicing Chartered Accountant CS Certificate
- Declaration from the NR buyer to the effect that he is eligible to acquire shares / compulsorily and mandatorily convertible preference shares / debentures/others under FDI policy and the existing sectoral limits and conditionality (such as minimum capitalization norms, etc) and Pricing Guidelines have been complied with