**Policy Summary: Amendment to Foreign Exchange Management (Foreign Currency Accounts by a Person Resident in India) Regulations, 2015**
On April 23, 2024, the Reserve Bank of India (RBI), via Notification No. FEMA. 10(R)/32024-RB, issued the Foreign Exchange Management (Foreign Currency Accounts by a Person Resident in India) Amendment Regulations, 2024. This amendment, enacted under Section 9 and clause (e) of subsection 2 of section 47 of the Foreign Exchange Management Act, 1999, modifies the Foreign Exchange Management (Foreign Currency Accounts by a Person Resident in India) Regulations, 2015, Notification No. FEMA 10(R)/2015-RB dated January 21, 2016.
The key change involves Regulation 5, sub-regulation (1). The existing provision is replaced to state that funds raised through External Commercial Borrowings (ECB), American Depository Receipts (ADRs), Global Depository Receipts (GDRs), or direct listing of equity shares of Indian companies on International Exchanges may be held in foreign currency accounts with banks outside India, pending utilisation or repatriation to India. This is subject to compliance with the conditions related to raising funds through these instruments.
These regulations take effect from the date of their publication in the Official Gazette.
The notification was issued by Latha Radhakrishnan, General Manager-in-Charge, Reserve Bank of India, Foreign Exchange Department, Central Office, Mumbai.
Key Entities Referenced
Reserve Bank of India: The central bank of India, responsible for regulating the country's monetary policy and foreign exchange.
Foreign Exchange Management Act, 1999: An Act of the Parliament of India to consolidate and amend the law relating to foreign exchange with the objective of facilitating external trade and payments and for promoting the orderly development and maintenance of foreign exchange market in India.
Foreign Exchange Management Foreign Currency Accounts by a person resident in India Regulations, 2015: Regulations pertaining to foreign currency accounts held by Indian residents.
Foreign Exchange Management Foreign Currency Accounts by a person resident in India Amendment Regulations, 2024: Amendment regulations to the 2015 regulations concerning foreign currency accounts held by Indian residents.
Section 9: Section of the Foreign Exchange Management Act, 1999, granting powers related to regulations.
Section 47: Section of the Foreign Exchange Management Act, 1999, concerning the power to make regulations.
External Commercial Borrowings: Commercial loans raised by eligible resident entities from recognized non-resident entities.
American Depository Receipts ADRs: A certificate representing shares of a foreign company trading on U.S. stock exchanges.
RESERVE BANK OF INDIA
(FOREIGN EXCHANGE DEPARTMENT)
CENTRAL OFFICE
MUMBAI 400 001
No. FEMA. 10(R)(3)/2024-RB April 23, 2024
Foreign Exchange Management (Foreign Currency Accounts by a person resident in India)
(Amendment) Regulations, 2024
In exercise of the powers conferred by Section 9 and clause (e) of sub-section (2) of section 47 of the
Foreign Exchange Management Act, 1999 (42 of 1999), the Reserve Bank of India makes the following
amendment in the Foreign Exchange Management (Foreign Currency Accounts by a person resident in
India) Regulations, 2015 (Notification No. FEMA10(R)/2015-RB dated January 21, 2016) (hereinafter
referred to as 'the Principal Regulations'), namely:-
1. Short Title & Commencement
(i) These Regulations may be called the Foreign Exchange Management (Foreign Currency Accounts by a
person resident in India) (Amendment) Regulations, 2024.
(ii) They shall come into force from the date of their publication in the Official Gazette.
2. Amendment to Regulation 5 of the Principal Regulations
In sub-regulation (F)(1) of Regulation 5 of the Principal Regulations, the existing provision shall be
substituted by the following, namely:
“Subject to compliance with the conditions in regard to raising of External Commercial Borrowings (ECB)
or raising of resources through American Depository Receipts (ADRs) or Global Depository Receipts
(GDRs) or through direct listing of equity shares of companies incorporated in India on International
Exchanges, the funds so raised may, pending their utilisation or repatriation to India, be held in foreign
currency accounts with a bank outside India.”
(Latha Radhakrishnan)
General Manager-in-Charge
Foot Note:
The Principal Regulations were published in the Official Gazette of Government of India - Extraordinary -
Part-II, Section 3, Sub-Section (i) dated 21.01.2016 - G.S.R.No.96(E) and subsequently amended as under
G.S.R. No.570(E) dated 01.06.2016
G.S.R. No.160(E) dated 27.02.2019