## Report on International Financial Services Centres Authority Banking Amendment Regulations, 2022
**1. Executive Summary:**
This report analyzes the International Financial Services Centres Authority (IFSCA) Banking Amendment Regulations, 2022, as published in the Gazette of India on June 30, 2022. This amendment modifies the IFSCA Banking Regulations, 2020. The key changes involve revisions to the definitions of "Banking Unit or IFSC Banking Unit," and "Parent Bank," and introduces new definitions for "Global Administrative Office (GAO)," "Group Entities," and "Representative Office (RO)" and "Support Services". It also allows a Parent Bank to set up a Representative Office or Global Administrative Office in IFSC under a suitable mechanism, subject to conditions specified by the Authority. These changes appear designed to expand the scope of permissible activities and entities within the IFSC framework, potentially enhancing its attractiveness for international financial institutions.
**2. Introduction:**
This report provides an informative overview of the International Financial Services Centres Authority Banking Amendment Regulations, 2022 (IFSCA202223GNREG025) based solely on the provided policy text. The purpose is to outline the key changes introduced by this amendment to the existing IFSCA Banking Regulations, 2020 and to assess their likely implications.
**3. Policy Overview:**
* The amendment modifies the International Financial Services Centres Authority Banking Regulations, 2020.
* **Core Objective(s) (Inferred):** The amendments aim to broaden the scope of permissible activities and operational structures for banking institutions operating within the International Financial Services Centres (IFSC), likely to enhance operational efficiency and attract a wider range of financial institutions.
**4. Background and Rationale:**
The amendment likely addresses the need to clarify and expand the types of entities and activities permissible within the IFSC. The introduction of definitions for Global Administrative Offices (GAOs) and Representative Offices (ROs), along with associated permissible activities, suggests an effort to attract more diverse operational models for foreign and Indian banks within the IFSC. The revised definition of "Parent Bank" is in line with the added definitions.
**5. Key Provisions / Changes:**
This section focuses on the specific changes introduced by the amendment text:
* **Change 1:** Substitution of the definition of "Banking Unit or IFSC Banking Unit" in Regulation 2(1)(c):
* **Original Definition:** The original definition is not provided in the text, but it is being replaced.
* **New Definition:** "Banking Unit or IFSC Banking Unit means a financial institution under clause c of subsection 1 of Section 3 of the Act that is licensed by the Authority to undertake permissible activities under these regulations".
* **Effect:** The new definition refers directly to the Act and the Authority's licensing, likely to provide a clearer legal basis and emphasize the Authority's control over permissible activities.
* **Change 2:** Insertion of new definitions for "Global Administrative Office (GAO)" and "Group Entities" after Regulation 2(1)(d):
* **New Definition (GAO):** A financial institution set up by its Parent Bank in IFSC for: (i) managing, administering, or coordinating operations of the Parent Bank or any of the Group entities either in IFSC or outside IFSC; (ii) providing support services to Parent Bank or any of the Group entities for execution of the permitted activities either in IFSC or outside IFSC. Activities outside IFSC are subject to the relevant regulator's directions.
* **New Definition (Group Entities):** Any holding company, subsidiaries, branches, or any other entity, in whatever legal form, through which the Parent bank undertakes its operations or permitted activities.
* **Effect:** This introduces a new type of permissible entity – the GAO – which can centralize administrative and support functions for a Parent Bank and its Group entities, potentially leading to cost efficiencies and streamlined operations.
* **Change 3:** Substitution of the definition of "Parent Bank" in Regulation 2(1)(j):
* **Original Definition:** The original definition is not provided in the text, but it is being replaced.
* **New Definition:** "Parent Bank means a Foreign Bank as defined under subregulation d, or an Indian Bank as defined under subregulation f, or both, that intends to, or has set up a Banking Unit or Representative Office or Regional Administrative Office".
* **Effect:** The new definition explicitly includes entities intending to set up or having set up a Representative Office or Regional Administrative Office, expanding the scope of what constitutes a Parent Bank under these regulations.
* **Change 4:** Insertion of a new definition for "Representative Office (RO)" after Regulation 2(1)(l):
* **New Definition:** A financial institution set up by its Parent Bank in IFSC for: (i) marketing of financial products; (ii) collection of data; (iii) carrying out of outreach operations.
* **Effect:** This formally recognizes and defines Representative Offices, allowing Parent Banks to engage in marketing, data collection, and outreach activities within the IFSC.
* **Change 5:** Insertion of a new definition for "Support Services" after Regulation 2(1)(o):
* **New Definition:** Support services shall mean the ancillary activities and processes required for execution of the permitted activities.
* **Effect:** This clarifies what is meant by support services and establishes it as part of the permitted activities.
* **Change 6:** Substitution of sub regulation 9 of regulation 3:
* **Original Definition:** The original regulation is not provided in the text, but it is being replaced.
* **New Definition:** A Parent Bank may set up its Representative Office or Global Administrative Office in IFSC under a suitable mechanism, subject to such conditions as may be specified by the Authority.
* **Effect:** The new regulation explicitly states that a Parent Bank may set up its Representative Office or Global Administrative Office in IFSC under a suitable mechanism, subject to such conditions as may be specified by the Authority.
**6. Target Audience and Stakeholders:**
Based on the text, the directly affected stakeholders are:
* Foreign Banks.
* Indian Banks.
* Financial institutions operating or intending to operate within the IFSC.
* Parent Banks considering establishing Banking Units, Representative Offices, or Global Administrative Offices in IFSC.
**7. Implementation Aspects (Inferred):**
* **Responsible Agency/Bodies:** The International Financial Services Centres Authority (IFSCA) is the responsible authority.
* **Timelines/Procedures:** The regulations came into force on the date of their publication in the Official Gazette (June 30, 2022). The "suitable mechanism" for setting up Representative Offices and Global Administrative Offices will be specified by the IFSCA.
* The new regulation allows a Parent Bank to set up its Representative Office or Global Administrative Office in IFSC, implies the need for application and approval processes to be developed and followed for the "suitable mechanism".
**8. Expected Outcomes / Impact of Changes:**
The likely intended outcomes of these amendments are:
* Increased attractiveness of IFSC for foreign and Indian banks.
* Greater operational flexibility for banks operating within IFSC.
* Establishment of centralized administrative and support functions through GAOs, potentially leading to cost savings and efficiency gains.
* Enhanced marketing and outreach capabilities for banks through ROs.
* Overall growth and development of the financial services sector within the IFSC.
**9. Conclusion:**
The IFSCA Banking Amendment Regulations, 2022, introduce significant changes aimed at expanding the scope of permissible activities and entities within the International Financial Services Centres. By defining and allowing the establishment of Global Administrative Offices and Representative Offices, the amendments seek to attract a wider range of financial institutions and enhance the operational efficiency of those already present. These changes are likely to contribute to the growth and development of the IFSC as a globally competitive financial hub.
Key Entities Referenced
International Financial Services Centres Authority: A regulatory authority. Makes regulations further to amend the International Financial Services Centres Authority Banking Regulations, 2020.
International Financial Services Centres Authority Act, 2019: The Act that confers powers to the International Financial Services Centres Authority.
International Financial Services Centres Authority Banking Regulations, 2020: Regulations that are being amended by this notification.
International Financial Services Centres Authority Banking Amendment Regulations, 2022: The regulations that are being introduced in this notification. These regulations amend the International Financial Services Centres Authority Banking Regulations, 2020.
Gandhinagar, Gujarat: The location where the notification was issued.
Official Gazette: The official publication in which the regulations are published.
Banking Unit or IFSC Banking Unit: A financial institution under clause c of subsection 1 of Section 3 of the Act that is licensed by the Authority to undertake permissible activities under these regulations
Global Administrative Office or GAO: A financial institution set up by its Parent Bank in IFSC for undertaking any one or more of the activities related to managing, administering, or coordinating operations of the Parent Bank or any of the Group entities either in IFSC or outside IFSC
Parent Bank: A Foreign Bank as defined under subregulation d, or an Indian Bank as defined under subregulation f, or both, that intends to, or has set up a Banking Unit or Representative Office or Regional Administrative Office
Representative Office or RO: A financial institution set up by its Parent Bank in IFSC for undertaking any one or more of the activities related to marketing of financial products, collection of data, and carrying out of outreach operations
Injeti Srinivas: Chairperson of the International Financial Services Centres Authority
New Delhi, Delhi: Place of publication of Gazette of India
रजिस्ट्री स.ं डी.एल.- 33004/99 REGD. No. D. L.-33004/99
xxxGIDHxxx
सी.जी.-जी.जxxे.x-GअI.D-E0x1x0x7 2022-236943
CG-GJ-E-01072022-236943
ऄसाधारण
EXTRAORDINARY
भाग III—खण् ड 4
PART III—Section 4
प्राजधकार स ेप्रकाजित
PUBLISHED BY AUTHORITY
स.ं 332] नइ क्रदल्ली, बृहस्ट्प जतिार, िनू 30, 2022/अषाढ़ 9, 1944
No. 332] NEW DELHI, THURSDAY, JUNE 30, 2022/ASADHA 9, 1944
ऄतं राष्ट्रा ीय जित्तीय सिे ा केन्द्र प्राजधकरण
ऄजधसचू ना
गांधीनगर, 29 , 2022
ऄतं रराष्ट्रीय जित्तीय सेिा केन्द्र प्राजधकरण (बकैं कारी)(सिं ोधन) जिजनयम, 2022
अइ.एफ.एस.सी.ए./2022-23/िी.एन./रेग्य0ु 25.—–ऄंतरराष्ट्रीय जित्तीय सेिा केन्द्र प्राजधकरण, ऄंतरराष्ट्रीय
जित्तीय सेिा केन्द्र प्राजधकरण ऄजधजनयम, 2019 की धारा 12 की ईपधारा (1) और धारा 13 की ईपधारा (1) के साथ पठठत
धारा 28 की ईपधारा (1) द्वारा प्रदत्त िजियों का प्रयोग करते हुए, ऄंतरराष्ट्रीय जित्तीय सेिा केन्द्र प्राजधकरण (बैंककारी)
जिजनयम, 2020 का और संिोधन करने के जलए जनम्नजलजखत जिजनयम बनाता ह,ै ऄथाात्:-
1. (1) आन जिजनयमों का संजिप्त नाम ऄंतरराष्ट्रीय जित्तीय सेिा केन्द्र प्राजधकरण (बैंककारी) (संिोधन) जिजनयम,
2022 ह ै।
(2) य ेरािपत्र में ईनके प्रकािन की तारीख को प्रिृत्त होंग े।
2. ऄंतरराष्ट्रीय जित्तीय सेिा केन्द्र प्राजधकरण (बैंककारी) जिजनयम, 2020 (जिन्द्ह ें आसमें स े पश्चात ् मलू जिजनयम कहा
गया ह,ै के जिजनयम 2 के ईप-जिजनयम (1) के खडं (ग) के स्ट्थान पर जनम्नजलजखत रखा िाएगा, ऄथाात्:-
“(ग) “बैंककारी यूजनट” या “अइ.एफ.एस.सी. बैंककारी यूजनट” से ऄजधजनयम की धारा 3 की ईपधारा (1) के
खंड (ग) के ऄधीन कोइ ऐसी जित्तीय संस्ट्था ऄजभप्रेत ह,ै िो प्राजधकरण द्वारा आन जिजनयमों के ऄधीन ऄनुज्ञेय
क्रियाकलाप करने के जलए ऄनज्ञु प्त ह;ै ”
3. मूल जिजनयमों में, जिजनयम 2 के ईप-जिजनयम (1) के खडं (घ) के पश्चात् जनम्नजलजखत खडं ऄंतःस्ट्थाजपत क्रकए
िाएंगे, ऄथाात:् -
4356 GI/2022 (1)2 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC.4]
“(घक) “िैजिक (ग्लोबल) प्रिासजनक कायाालय” या “िी.ए.ओ.” से ईसके मलू बैंक द्वारा जनम्नजलजखत क्रियाकलापों
में से कोइ एक या ऄजधक क्रियाकलाप करने के जलए अइ.एफ.एस.सी. में स्ट्थाजपत कोइ जित्तीय संस्ट्था ऄजभप्रेत ह,ै
ऄथाात:् -
(i) मलू बैंक या अइ.एफ.एस.सी. में या अइ.एफ.एस.सी. के बाहर क्रकसी भी समूह आकाइ के प्रचालनों का प्रबंध,
प्रिासन या समन्द्िय करना;
(ii) मलू बैंक या क्रकसी समूह आकाइ को, अइ.एफ.एस.सी. म ें या अइ.एफ.एस.सी. के बाहर ऄनुज्ञात क्रियाकलापों
के जनष्पादन के जलए सहायता सेिाएं प्रदान करना ।
परन्द्त ु अइ.एफ.एस.सी. के बाहर क्रकसी ऄजधकार-िेत्र से सबं ंजधत क्रियाकलाप, ईि ऄजधकार-िेत्र में सुसंगत
जिजनयामक के जनदेिों और ऄनदु ेिों के ऄधीन होंगे ।
“(घख) “समूह आकाइ” स े ऐसी कोइ जनयंत्री कंपनी, सहायक कंपनी, िाखा या कोइ ऄन्द्य आकाइ, चाह े ि े क्रकसी भी
जिजधक रूप म ेंहो, ऄजभप्रेत ह,ै जिसके माध्यम से मूल बैंक ऄपने प्रचालन या ऄनज्ञु ात क्रियाकलाप करता ह ै।”
4. मूल जिजनयमों में, जिजनयम 2 के ईप-जिजनयम (1) के खंड (ञ) के स्ट्थान पर जनम्नजलजखत रखा िाएगा, ऄथाात्:-
“(ञ) “मूल बैंक” से, ईप-जिजनयम (घ) के ऄधीन यथा-पठरभाजषत कोइ ऐसा जिदेिी बैंक या ईप-जिजनयम (च) के
ऄधीन यथा-पठरभाजषत कोइ ऐसा भारतीय बैंक या दोनों ऄजभप्रेत ह,ैं जिसका अिय कोइ बैंककारी यूजनट या
प्रजतजनजध कायाालय या िेत्रीय प्रिासजनक कायाालय स्ट्थाजपत करना ह ै या जिसन े कोइ बैंककारी यूजनट या
प्रजतजनजध कायाालय या िेत्रीय प्रिासजनक कायाालय स्ट्थाजपत क्रकया है;”
5. मूल जिजनयमों में, जिजनयम 2 के ईप-जिजनयम (1) के खंड (ठ) के पश्चात् जनम्नजलजखत खडं ऄंतःस्ट्थाजपत क्रकया
िाएगा, ऄथाात:् -
“(ठक) “प्रजतजनजध कायाालय” या “अर.ओ.” स े ईसके मूल बैंक द्वारा जनम्नजलजखत क्रियाकलापों म ें स े कोइ एक या
ऄजधक क्रियाकलाप करने के जलए, अइ.एफ.एस.सी. म ें स्ट्थाजपत की गइ कोइ जित्तीय संस्ट्था ऄजभप्रेत ह,ै ऄथाात्:-
(i) जित्तीय ईत्पादों का जिपणन करना;
(ii) डाटा का सग्रं हण करना;
(iii) पहुचं से परे प्रचालनों को क्रियाजन्द्ित करना ।”
6. मूल जिजनयमों म,ें जिजनयम 2 के ईप-जिजनयम (1) के खंड (ण) के पश्चात्, जनम्नजलजखत खडं ऄंतःस्ट्थाजपत क्रकया
िाएगा, ऄथाात:् -
“(णक) “सहायता सेिाओं” स,े ऄनुज्ञात क्रियाकलापों के जनष्पादन के जलए ऄपेजित ऄनुषगं ी क्रियाकलाप और
प्रिमण ऄजभप्रेत ह ैं।”
7. मूल जिजनयमों में, जिजनयम 3 के ईप-जिजनयम (9) के स्ट्थान पर जनम्नजलजखत रखा िाएगा, ऄथाात्:-
“(9) कोइ मलू बैंक, अइ.एफ.एस.सी. में, ऐसी ितों के ऄधीन रहते हुए, िो प्राजधकरण द्वारा जिजनर्ददष्ट की िाएं, एक
ईपयुि प्रक्रिया के ऄधीन ऄपना प्रजतजनजध कायाालय या िैजिक प्रिासजनक कायाालय स्ट्थाजपत कर सकेगा ।”
आनिेती श्रीजनिास, ऄध्यि
[जिज्ञापन III.4/ऄसा./152/2022-23]
ठटप्पण:
1. ऄंतरराष्ट्रीय जित्तीय सेिा केन्द्र प्राजधकरण (बैंककारी) जिजनयम, 2020, भारत के रािपत्र, ऄसाधारण म ें
ऄजधसूचना स.ं अइ.एफ.एस.सी.ए./2020-21/िी.एन./रेग्यु004 द्वारा तारीख 20 निम्बर, 2020 को प्रकाजित
क्रकए गए थ,े जिन्द्ह ें भारत के रािपत्र, ऄसाधारण, में ऄजधसूचना सं. सी.िी-एम.एच.-इ-12052021-226980[भाग III—खण् ड 4] भारत का रािपत्र : ऄसाधारण 3
द्वारा तारीख 12 मइ, 2021 को प्रकाजित ऄंतरराष्ट्रीय जित्तीय सेिा केन्द्र प्राजधकरण के िुजिपत्र के साथ पढ़ा
िाना ह;ै
2. ऄंतरराष्ट्रीय जित्तीय सेिा केन्द्र प्राजधकरण (बैंककारी) (संिोधन) जिजनयम, 2021, भारत के रािपत्र, ऄसाधारण
में ऄजधसूचना सं. अइ.एफ.एस.सी.ए./2020-21/िी.एन. /रेग्यु009 द्वारा तारीख 25 माचा, 2021 को प्रकाजित
क्रकए गए थ;े और
3. ऄंतरराष्ट्रीय जित्तीय सेिा केन्द्र प्राजधकरण (बैंककारी) (संिोधन) जिजनयम, 2021, भारत के रािपत्र, ऄसाधारण
में ऄजधसूचना स.ं अइ.एफ.एस.सी.ए./2021-22/िी.एन./रेग्यु013 द्वारा तारीख 5 िलु ाइ, 2021 को प्रकाजित
क्रकए गए थे ।
INTERNATIONAL FINANCIAL SERVICES CENTRES AUTHORITY
NOTIFICATION
Gandhinagar, the 29th June, 2022
INTERNATIONAL FINANCIAL SERVICES CENTRES AUTHORITY (BANKING) (AMENDMENT)
REGULATIONS, 2022
IFSCA/2022-23/GN/REG025.—In exercise of the powers conferred by sub-section (1) of Section 28 read
with sub-section (1) of Section 12 and sub-section (1) of Section 13 of the International Financial Services Centres
Authority Act, 2019, the International Financial Services Centres Authority hereby makes the following regulations
further to amend the International Financial Services Centres Authority (Banking) Regulations, 2020, namely: -
1. (1) These regulations may be called the International Financial Services Centres Authority (Banking)
(Amendment) Regulations, 2022.
(2) They shall come into force on the date of their publication in the Official Gazette.
2. In the International Financial Services Centres Authority (Banking) Regulations, 2020 (hereinafter referred to
as the Principal Regulations), clause (c) of sub-regulation (1) of regulation 2, shall be substituted with the
following, namely,—
“(c) “Banking Unit” or “IFSC Banking Unit” means a financial institution under clause (c) of sub-section (1) of
Section 3 of the Act that is licensed by the Authority to undertake permissible activities under these
regulations;”
3. In the Principal Regulations, after clause (d) of sub-regulation (1) of regulation 2, following clauses shall be
inserted, namely,—
“(da) “Global Administrative Office” or “GAO” means a financial institution set up by its Parent Bank in IFSC
for undertaking any one or more of the following activities, namely:
(i) managing, administering, or coordinating operations of the Parent Bank or any of the Group entities
either in IFSC or outside IFSC;
(ii) providing support services to Parent Bank or any of the Group entities for execution of the permitted
activities either in IFSC or outside IFSC
Provided that the activities pertaining to a jurisdiction outside IFSC shall be subject to the directions and
instructions of the relevant regulator in the said jurisdiction.
“(db) “Group entities” means any holding company, subsidiaries, branches or any other entity, in whatever
legal form, through which the Parent bank undertakes its operations or permitted activities.
4. In the Principal Regulations, clause (j) of sub-regulation (1) of regulation 2, shall be substituted with the
following, namely,—
“(j) “Parent Bank” means a Foreign Bank as defined under sub-regulation (d), or an Indian Bank as defined
under sub-regulation (f), or both, that intends to, or has set up a Banking Unit or Representative Office or
Regional Administrative Office;
5. In the Principal Regulations, after clause (l) of sub-regulation (1) of regulation 2, following clause shall be
inserted, namely,—4 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC.4]
“(la) “Representative Office” or “RO” means a financial institution set up by its Parent Bank in IFSC for
undertaking any one or more of the following activities, namely:
(i) marketing of financial products;
(ii) collection of data;
(iii) carrying out of outreach operations.”
6. In the Principal Regulations, after clause (o) of sub-regulation (1) of regulation 2, following clause shall be
inserted, namely,—
“(oa) “Support services” shall mean the ancillary activities and processes required for execution of the
permitted activities”
7. In the Principal Regulations, sub regulation 9 of regulation 3, shall be substituted with the following, namely:
“(9) A Parent Bank may set up its Representative Office or Global Administrative Office in IFSC under a
suitable mechanism, subject to such conditions as may be specified by the Authority.”
INJETI SRINIVAS, Chairperson
[ADVT.-III/4/Exty./152/2022-23]
Note:
1. The International Financial Services Centres Authority (Banking) Regulations, 2020 were published in the
Gazette of India Extraordinary vide notification No. IFSCA/2020-21/GN/REG004 on 20th November 2020, to be
read with the Corrigendum published in the Gazette of India Extraordinary vide notification No. CG-MH-E-
12052021-226980, on 12th May, 2021;
2. The International Financial Services Centres Authority (Banking) (Amendment) Regulations, 2021 were
published in the Gazette of India Extraordinary vide notification No. IFSCA/2020-21/GN/REG009 on 25th
March, 2021; and
3. The International Financial Services Centres Authority (Banking) (Amendment) Regulations, 2021 were
published in the Gazette of India Extraordinary vide notification No. IFSCA/2021-22/GN/REG013 on 05th July,
2021.
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