Executive Summary:
This circular from the Reserve Bank of India (RBI) introduces changes to the reporting of foreign investment through the Single Master Form (SMF) on the FIRMS portal. It implements auto-acknowledgement of submitted forms and introduces a system-calculated Late Submission Fee (LSF) for delayed reporting. AD banks must verify forms within five working days, and applicants may need to pay LSF or apply for compounding of contravention depending on the delay.
Key Points / Main Content:
* **Reporting Process Changes:**
* Forms submitted on the FIRMS portal will be auto-acknowledged with a timestamp.
* AD banks must verify the forms within five working days, based on uploaded documents.
* **Late Submission Fee (LSF):**
* For reporting delays up to three years, the system will compute the LSF.
* AD banks will approve the forms subject to LSF payment.
* Applicants will receive an email specifying the LSF amount and payment timeline.
* RBI Regional Office (RO) will update the status on FIRMS after LSF realization, and the applicant will be notified.
* **Compounding of Contravention:**
* For delays exceeding three years, AD banks will approve the forms, subject to compounding of contravention.
* Applicants must then apply to RBI for compounding.
* **Rejection of Forms:**
* Reasons for rejection by AD banks will be communicated to the applicant via email and on the FIRMS portal.
Impact Analysis:
* **Authorised Dealer (AD) Category-I Banks:**
* Impact: AD banks are responsible for verifying the forms within five working days and advising on LSF or compounding.
* Action Required: AD banks must verify the forms, advise applicants on LSF or compounding, and ensure compliance with the new guidelines.
* **Applicants/Foreign Investors:**
* Impact: Applicants will experience auto-acknowledgement of forms and may be subject to LSF for delayed reporting or required to apply for compounding of contravention.
* Action Required: Applicants must ensure timely and accurate form submission. Pay LSF within the specified timeline if applicable, or apply for compounding of contravention for delays exceeding three years.
* **Reserve Bank of India (RBI):**
* Impact: The RBI Regional Offices (ROs) will receive LSF payments and update the FIRMS portal accordingly.
* Action Required: ROs must monitor LSF payments and update the FIRMS portal to reflect the payment status.
Key Entities Referenced
Reserve Bank of India: The central bank of India, responsible for regulating the banking sector and managing the country's monetary policy.
Single Master Form (SMF): A form used for reporting foreign investment in India through the FIRMS portal.
FIRMS Portal: The Foreign Investment Reporting and Management System portal, used for reporting foreign investment in India to the Reserve Bank of India.
Authorised Dealer Category-I banks (AD banks): Banks authorized by the Reserve Bank of India to deal in foreign exchange.
A.P. DIR Series Circular No. 30: A circular issued by the Reserve Bank of India regarding foreign exchange regulations. Dated June 07, 2018
Late Submission Fee (LSF): A fee charged for the delayed reporting of foreign investment in India.
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.
Regional Office (RO) of RBI: Regional branches of the Reserve Bank of India.
भारतीय �रज़व� ब�क
RESERVE BANK OF INDIA
www.rbi.org.in
RBI/2022-23/160
A.P. (DIR Series) Circular No. 22 January 04, 2023
To
All Category-I Authorised Dealer Banks
Madam / Sir
Foreign Investment in India - Rationalisation of reporting
in Single Master Form (SMF) on FIRMS Portal
Attention of Authorised Dealer Category-I banks (AD banks) is invited to A.P. (DIR
Series) Circular No. 30 dated June 07, 2018.
2. It is advised that the following changes are being implemented with respect to the
reporting of foreign investment in SMF on FIRMS portal:
i) The forms submitted on the portal will be auto-acknowledged. The AD banks
shall verify the same within five working days based on the uploaded
documents, as specified.
ii) In cases of delayed reporting, the AD banks shall either advise the Late
Submission Fee (LSF) to the applicants, which will be computed by the system
or advise for compounding of contravention, as the case may be.
The salient features of the changes made in the system are given in Annex for ready
reference. For detailed guidelines, the FIRMS manual available at
https://firms.rbi.org.in may be referred to, and the version of manual available at the
portal will have the finality in case of any mismatch.
3. The directions contained in this circular have been issued under sections 10(4) and
11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without
prejudice to permissions/approvals, if any, required under any other law.
Yours faithfully
(N. Senthil Kumar)
General Manager-in-ChargeAnnex
Auto-acknowledgement of SMF in FIRMS and online calculation of LSF
The forms submitted in FIRMS will now be processed as detailed below:
All forms submitted with the requisite documents will be auto-acknowledged on the
FIRMS portal with a time stamp and an auto-generated e-mail will be sent to the
applicant.
i) The forms submitted within prescribed timelines, will be verified by the AD
banks based on the uploaded mandatory documents and ensure that the same
are in compliance with the extant guidelines.
ii) The system would identify the delay in reporting, if any.
iii) For forms filed with a delay less than or equal to three years, the AD banks will
approve the same, subject to payment of LSF.
iv) The LSF will be computed by the system and an e-mail will be sent to the
applicant and the concerned Regional Office (RO) of RBI specifying the amount
and the timeline within which it is to be paid to the concerned RO of RBI.
v) Once the LSF amount is realised, the concerned RO will update the status in
the FIRMS portal and the updated status will be communicated to the applicant
through a system generated e-mail, which can also be viewed in the FIRMS
portal.
vi) The AD bank will approve the forms filed with a delay greater than three years,
subject to compounding of contravention. The applicant may thereafter
approach RBI with their application for compounding.
vii) The remarks of the AD Bank for rejection of forms, if any, will be communicated
to the applicant through a system generated e-mail and the same can also be
viewed in the FIRMS portal.
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