Executive Summary:
This notification from the Reserve Bank of India amends the Foreign Exchange Management (Foreign Exchange Derivative Contracts) Regulations of 2000. The amendment, effective from the date of publication in the Official Gazette, provides permission to persons resident outside India to enter into exchange-traded currency derivatives for hedging Rupee currency risk. It was issued on October 25, 2016.
Key Points / Main Content:
* **Amendment Title:** Foreign Exchange Management (Foreign Exchange Derivative Contracts) Amendment Regulations, 2016.
* **Authority:** Issued by the Reserve Bank of India under Section 47(2)(h) of the Foreign Exchange Management Act, 1999.
* **Effective Date:** Deemed to have come into force from the date of publication in the Official Gazette.
* **Amendment to Regulation 5B:**
* Replaces the existing Regulation 5B in the Foreign Exchange Management (Foreign Exchange Derivative Contracts) Regulations, 2000.
* **Permission for Residents Outside India:**
* Allows persons resident outside India to transact in currency derivatives contracts on recognized stock exchanges to hedge Rupee currency risk.
* This risk must arise from:
* A permitted current account transaction.
* A Rupee-denominated asset held.
* A Rupee-denominated liability incurred, as permitted under FEMA, 1999.
* Subject to terms and conditions set forth in directions issued by the Reserve Bank of India from time to time.
Impact Analysis:
* **Persons Resident Outside India:**
* Impact: Now permitted to enter into exchange-traded currency derivatives to hedge Rupee currency risk arising from specific transactions, assets, or liabilities.
* Action Required: Comply with the terms and conditions set forth by the Reserve Bank of India when transacting in currency derivatives.
* **Reserve Bank of India:**
* Impact: Responsible for issuing directions and overseeing the implementation of these amended regulations.
* Action Required: Issue directions regarding the terms and conditions for persons resident outside India to transact in currency derivatives.
* **Stock Exchanges:**
* Impact: May see increased activity in currency derivative contracts from persons resident outside India.
* Action Required: Ensure compliance with the regulations and any directions issued by the Reserve Bank of India.
Key Entities Referenced
Reserve Bank of India: The central bank of India, responsible for regulating the financial system and foreign exchange management.
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 Exchange Derivative Contracts Regulations, 2000: Regulations issued by the Reserve Bank of India pertaining to foreign exchange derivative contracts.
Mumbai, Maharashtra: The city in Maharashtra where the Financial Markets Regulatory Department, Central Office of the Reserve Bank of India is located.
Foreign Exchange Management Foreign Exchange Derivative Contracts Amendment Regulations, 2016: The specific amendment regulations being enacted.
Securities Contracts Regulations Act, 1956: An act to prevent undesirable transactions in securities by regulating the business of dealing therein, by providing for certain other matters connected therewith and incidental thereto
Rupee: The official currency of India.
New Delhi, Delhi: The city in Delhi where the Dte. of Printing at Government of India Press is located.
jftLVªh laö Mhö ,yö&33004@99 REGD. NO. D. L.-33004/99
vlk/kj.k
EXTRAORDINARY
Hkkx II—[k.M 3—mi&[k.M (i)
PART II—Section 3—Sub-section (i)
izkf/dkj ls izdkf'kr
PUBLISHED BY AUTHORITY
la- 744] ubZ fnYyh] eaxyokj] vDrwcj 25] 2016@dk£rd 3] 1938
No. 744] NEW DELHI, TUESDAY, OCTOBER 25, 2016/KARTIKA 3, 1938
भारतीय (cid:7407)रज़व (cid:6981)बक(cid:7289)
(िव(cid:7275)ीय बाजार िविनयमन िवभाग)
(क(cid:7286)(cid:7076)ीय कायाल(cid:6981) य)
अिधसचू ना
मुंबई, 25 अ(cid:6989) तबू र, 2016
स.ं 378/ फेमा/2016-आरबी
िवदशे ी म(cid:7076)ु ा (cid:7079)बधं (िवदशे ी मु(cid:7076)ा डे(cid:7407)रव(cid:7407)े टव सिं वदाए)ं (सशं ोधन) िविनयमावली, 2016
सा.का.िन. 1005(अ).— िवदशे ी मु(cid:7076)ा (cid:7079)बंध अिधिनयम, 1999 (1999 का 42) क(cid:7409) धारा 47 क(cid:7409) उप-धारा
(2) के खंड (एच) (cid:7367)ारा (cid:7079)द(cid:7275) शि(cid:7334)य(cid:7298) का (cid:7079)योग करते (cid:7263)ए भारतीय (cid:7407)रज़व(cid:6981) ब(cid:7289)क एतद(cid:7367)् ारा िवदशे ी मु(cid:7076)ा (cid:7079)बंध
(िवदशे ी म(cid:7076)ु ा डे(cid:7407)रव(cid:7407)े टव सिं वदाए)ं िविनयमावली, 2000 (3 मई 2000 क(cid:7409) अिधसचू ना सं.फेमा सं. 25/2000-
आरबी) म(cid:7286) िन(cid:7388)िलिखत संशोधन करता ह,ै अथा(cid:6981)त्:-
1. सिं (cid:6979)(cid:7385) नाम एव ं(cid:7079)ार(cid:7013)भ :
(i) ये िविनयम िवदशे ी मु(cid:7076)ा (cid:7079)बंध (िवदशे ी मु(cid:7076)ा डे(cid:7407)रवे(cid:7407)टव संिवदाएं) (संशोधन) िविनयमावली, 2016
कहलाएगं े।
(ii) वे सरकारी राजप(cid:7074) म (cid:7286) उनके (cid:7079)काशन क(cid:7409) तारीख से लागू (cid:7263)ए माने जाएगं े।
4995 GI/2016 (1)(cid:32)2 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(i)]
2. िविनयम 5बी म (cid:7286) सशं ोधन: िवदशे ी मु(cid:7076)ा (cid:7079)बंध (िवदशे ी मु(cid:7076)ा ड(cid:7407)े रव(cid:7407)े टव संिवदाएं) िविनयमावली, 2000 (3 मई
2000 क(cid:7409) अिधसूचना सं.फेमा सं.25/आरबी-2000) क(cid:7409) मूल िविनयमावली म(cid:7286) िविनयम 5बी क(cid:7409) जगह िन(cid:7388)िलिखत
(cid:7079)ित(cid:7021)थािपत हो जाएगा:
5बी भारत स ेबाहर के िनवासी (cid:7408)कसी (cid:7390)ि(cid:7334) को ए(cid:6989)सचज(cid:7286) (cid:7069)ेडेड म(cid:7076)ु ा डे(cid:7407)रव(cid:7407)े टव म (cid:7286)भाग लने ेक(cid:7409) अनमु ित
भारत से बाहर का िनवासी कोई (cid:7390)ि(cid:7334) िजसे िन(cid:7388) के कारण (cid:7271)पया मु(cid:7076)ा जोिखम होः
(i)(cid:32) कोई अनुमत चालू खाता लेनदने या
(ii)(cid:32) उसके (cid:7367)ारा धा(cid:7407)रत कोई (cid:7271)पया मू(cid:7016)यव(cid:7414)गत आि(cid:7021)त या उसके (cid:7367)ारा क(cid:7409) गई कोई (cid:7271)पया मू(cid:7016)यव(cid:7414)गत
दये ता, जैसा(cid:7408)क फेमा, 1999 के तहत अनुमत ह,ै ऐसे जोिखम से बचाव के िलए (cid:7079)ितभूित संिवदा
(िविनयमावली) अिधिनयम, 1956 क(cid:7409) धारा 4 के तहत मा(cid:7008)यता (cid:7079)ा(cid:7385) (cid:7408)कसी शेयर बाजार म(cid:7286) ऐस े
िनयम व शत(cid:7300) के अधीन मु(cid:7076)ा डे(cid:7407)रवे(cid:7407)टव लेनदने कर सकता ह ै जैसा(cid:7408)क भारतीय (cid:7407)रज़व(cid:6981) ब(cid:7289)क (cid:7367)ारा
समय-समय पर जारी (cid:7408)दशािनदश(cid:7287) (cid:7298) म(cid:7286) (cid:7079)ितपा(cid:7408)दत (cid:7408)कया गया ह।ै
[फा. सं. 1/15/ईएम/2015]
टी. रिब शंकर, मु(cid:6990)य महा(cid:7079)बंधक
पाद (cid:7407)ट(cid:7009)पणी:- मूल िविनयमावली 8 मई 2000 के सा.का.िन.स.ं 411(अ), भाग II, खंड 3, उप-खंड (i) के तहत
सरकारी राजप(cid:7074) म(cid:7286) (cid:7079)कािशत (cid:7263)ई थी और त(cid:7004)प(cid:7391)ात िन(cid:7388)िलिखत (cid:7367)ारा संशोिधत क(cid:7409) गयी:-
सा.का.िन. सं. 756(अ) (cid:7408)दनाकं 28.09.2000,
सा.का.िन. सं. 264(अ) (cid:7408)दनाकं 09.04.2002,
सा.का.िन. सं. 579(अ) (cid:7408)दनाकं 19.08.2002,
सा.का.िन. सं. 222(अ) (cid:7408)दनाकं 18.03.2003,
सा.का.िन. सं. 532(अ) (cid:7408)दनाकं 09.07.2003,
सा.का.िन. सं. 880(अ) (cid:7408)दनाकं 11.11.2003,
सा.का.िन. सं. 881(अ) (cid:7408)दनाकं 11.11.2003,
सा.का.िन. सं. 750(अ) (cid:7408)दनाकं 28.12.2005,
सा.का.िन. सं. 222(अ) (cid:7408)दनाकं 19.04.2006,
सा.का.िन. सं. 223(अ) (cid:7408)दनाकं 19.04.2006,
सा.का.िन. सं. 760(अ) (cid:7408)दनाकं 07.12.2007,
सा.का.िन. सं. 577(अ) (cid:7408)दनाकं 05.08.2008,
सा.का.िन. सं. 440(अ) (cid:7408)दनाकं 23.06.2009,
सा.का.िन. सं. 895(अ) (cid:7408)दनाकं 14.12.2009,
सा.का.िन. सं. 635(अ) (cid:7408)दनाकं 27.07.2010,¹Hkkx IIµ[k.M 3(i)º Hkkjr dk jkti=k % vlk/kj.k 3
सा.का.िन. सं. 608(अ) (cid:7408)दनाकं 03.08.2012,
सा.का.िन. सं. 799(अ) (cid:7408)दनाकं 30.10.2012,
सा.का.िन. सं. 330(अ) (cid:7408)दनाकं 23.05.2013,
सा.का.िन. सं.374(अ) (cid:7408)दनांक 02.06.2014 and
सा.का.िन. सं. 365(अ) (cid:7408)दनाकं 01.06.2016.
RESERVE BANK OF INDIA
(Financial Markets Regulatory Department )
(Central Office)
NOTIFICATION
Mumbai, the 25th October, 2016
No. FEMA. 378/RB-2016
Foreign Exchange Management (Foreign Exchange Derivative Contracts) (Amendment) Regulations, 2016
G.S.R. 1005 (E) .—In exercise of the powers conferred by clause (h) of sub-section (2) of section 47 of the
Foreign Exchange Management Act, 1999 (42 of 1999), the Reserve Bank of India hereby makes the following
amendments in the Foreign Exchange Management (Foreign Exchange Derivative Contracts) Regulations, 2000
(Notification No. FEMA 25/RB-2000 dated May 3, 2000), namely:-
1. Short Title and Commencement :
(i) These regulations may be called the Foreign Exchange Management (Foreign Exchange Derivative
Contracts) (Amendment) Regulations, 2016.
(ii) They shall be deemed to have come into force with effect from the date of their publication in the Official
Gazette.
2. Amendment of Regulation 5B: In the Foreign Exchange Management (Foreign Exchange Derivative Contracts)
Regulations, 2000 (Notification No. FEMA 25/RB-2000 dated May 3, 2000), under the principal regulations, for the
existing Regulation 5B, the following shall be substituted namely:
“5B Permission to a person resident outside India to enter into exchange traded currency derivatives
A person resident outside India who is exposed to Rupee currency risk arising out of:
(i)(cid:32) a permitted current account transaction or
(ii)(cid:32) a Rupee denominated asset held by him or a Rupee denominated liability incurred by him, as permitted
under FEMA, 1999, may transact currency derivatives contracts on a stock exchange recognised under
section 4 of Securities Contracts (Regulations) Act, 1956 to hedge such exposure, subject to such terms
and conditions as may be set forth in the directions issued by the Reserve Bank of India from time to
time.(cid:32)
[F. No. 1/15/EM/2015]
T RABI SANKAR, Chief General Manager4 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(i)]
Footnote:-
The principal regulations were published in the Official Gazette vide GSR No. 411(E) dated May 8, 2000 in Part II,
Section 3, sub-section (i) and subsequently amended vide–
G.S.R. No. 756(E) dt. 28.09.2000,
G.S.R. No. 264(E) dt. 09.04.2002,
G.S.R. No. 579(E) dt. 19.08.2002,
G.S.R. No. 222(E) dt. 18.03.2003,
G.S.R. No. 532(E) dt. 09.07.2003,
G.S.R. No. 880(E) dt. 11.11.2003,
G.S.R. No. 881(E) dt. 11.11.2003,
G.S.R. No. 750(E) dt. 28.12.2005,
G.S.R. No. 222(E) dt. 19.04.2006,
G.S.R. No. 223(E) dt. 19.04.2006,
G.S.R. No. 760(E) dt. 07.12.2007,
G.S.R. No. 577(E) dt. 05.08.2008,
G.S.R. No. 440(E) dt. 23.06.2009,
G.S.R. No. 895(E) dt. 14.12.2009,
G.S.R. No. 635(E) dt. 27.07.2010,
G.S.R. No. 608(E) dt. 03.08.2012,
G.S.R. No. 799(E) dt. 30.10.2012,
G.S.R.No. 330(E) dated 23.05.2013,
G.S.R.No. 374(E) dated 02.06.2014 and
G.S.R.No. 365(E) dated 01.06.2016.
Uploaded by Dte. of Printing at Government of India Press, Ring Road, Mayapuri, New Delhi-110064
and Published by the Controller of Publications, Delhi-110054.