Mar 30, 2015 foreign exchange regulation act, 1974 or fera was introduced in the year 1974 with the prime objective of conserving preserving the foreign exchange. It was amended by the foreign exchange regulation amendment act 1993 and later in. Fera applied to all citizens of india, all over india. Nikhil agarwalneha gargneha baliwalmegha singhmegha mahasvarinavdeep kaurmohit goyalnikhil chaddanitin sachdevmohit badera 2. Also contains index, relevant portions of 44 cfr, and the stafford act. Foreign investors, frequently hear the terms fera and fema, when they deal with india. Accordingly, on june 1, 2000, the foreign exchange management act, 1999 fema brought in force to replace the then existing fera. The objective was the conservation of indias foreign exchange reserves, judicious use of foreign exchange, using mainly in these sector which require foreign technology.
The court held that fera was enacted to safeguard the countrys economic interests and any violation of its provisions would be contrary to indias public policy. Foreign exchange management act department for promotion. Stafford disaster relief and emergency assistance act 42 u. Fema 3392015 fem international financial services centre regulations, 2015. Fema came out as an extension of the earlier foreign exchange act fera. For printing pdf 2mb fema report 322 replaces fema 286. Intention was to bring provisions of fera in line with emerging trends of liberalization so as to remove obstacles in the inward flow of foreign exchange and foreign investment. The foreign exchange management act fema was an act passed in the winter session of parliament in 1999, which replaced foreign exchange regulation act. The main objective behind the foreign exchange management act 1999 is to consolidate and amend the law relating to foreign exchange with objective. Rules regulations notifications orders circulars statutory ordinance statutes. Fema was introduced because the fera didnt fit in with postliberalisation policies.
The scope and objective of fema was mainly to amend the laws related to foreign exchangeto facilitate external trade and payments and to develop the foreign exchange market in india. Foreign exchange regulation act fera, 1973 o foreign exchange regulation act fera o soon after independence, the govt. Fema an act initiated to facilitate external trade and payments and to promote orderly management of the forex market in the country. Fera was a draconian police law, where violation was a criminal offence. Fera act negotiable instrument foreign exchange market. So the judgment of acquittal passed by the trial court does not suffer any perversity and it is confirmed.
Difference between fera and fema foreign exchange regulation. The supreme court considered whether an award would fall foul of public policy if its enforcement would involve a contravention of the foreign exchange regulation act, 1973 fera. Foreign exchange management act, 1999 fema emerged as a replacement or say an improvement over the old foreign exchange regulation act, 1973 fera. August 19, 2015 fera fema offence under section 81 of the fera order of tribunal confiscating the foreign currency and imposition of penalties challenged on the ground that in.
Foreign exchange management act, 1999 summary bankexamstoday. August 19, 2015 ferafema offence under section 81 of the fera order of tribunal confiscating the foreign currency and imposition of penalties challenged on the ground that in. Dec 11, 2017 fema requires observation of its provisions in letter and spirit and if any contravention may land in penalties on the erring company and individuals. Fema requires observation of its provisions in letter and spirit and if any contravention may land in penalties on the erring company and individuals. Progression of fera to fema and its impact on foreign exchgane in india.
The court held that fera and fema were based on materially different. Here is a brief summarized description of what fera and fema mean. Fema means the foreign exchange management act, 1999. It was passed in the winter session of parliament in 1999, replacing the foreign. One, in addition to the default site, the refurbished site also has all the information bifurcated functionwise. Fema 1999 foreign exchange management act 1999 fema part. The foreign exchange regulation act fera was legislation passed in india in 1973. April 14, 2015 dear all welcome to the refurbished site of the reserve bank of india.
Difference between fera and fema with comparison chart. Pdf 647kb applicant handbook fema 323 questions and answers on how to apply for public assistance program grants. Fera was enacted in september 1973 and it came in force from january 1, 1974. Keeping in view the objective of promoting ease of doing business, a need was felt toconsolidatethe. Describes provisions and applicantion procedures for public assistance program grants. It was formulated in the year 1999 while it replaced fera foreign exchange regulation act. This was later replaced with the foreign exchange regulation act, 1973 fera, which came into effect on 1st jan.
Nris frequently hear the words fera and fema when it comes to dealings the involve india. Fema 1999 foreign exchange management act 1999 fema. The foreign exchange management act, 1999 fema is 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. A significant change that the fema brought with it, was that. Apr 28, 2016 fema started after the fera act was repealed fera was the previous trade policy that discouraged foreign currency in an economy and insulated the economy from being an open economy as industrial reforms in 1991 replacing of fera with fema is. It is an act to manage the foreign exchange of india as opposed to fera which was enacted to regulatecontrol the foreign exchange. In case of any conflict, the relevant fema notification will prevail. The foreign exchange regulation act fera is legislation that was passed by the indian parliament in 1973 and came into effect as of january 1, 1974. To comply with title iii of the no fear act, fema must, among other requirements, post a summary of the statistical data relating to the equal employment opportunity complaints filed with the agency. Fema consolidate and amend the law relating to foreign exchange facilitating external trade and payments promoting the orderly development and. Foreign exchange regulation act and foreign exchange management actpresented by. There are various conditions and stipulations in case of fdi, odi, investment by individuals in foreign shares, purchase of assets in foreign countries, extending guarantees, availing ecbs, suppliers credit.
The income tax department never asks for your pin numbers, passwords or similar access information for credit cards, banks or other financial accounts through email the income tax department appeals to taxpayers not to respond to such emails and not to share information relating to their credit card, bank and other financial accounts. New industrial policy of 1991 there was need to remove shackles of regulatory and legal provisions. Fema 52000rb dated may 3, 2000, as amended from time to time, the reserve bank makes the following regulations relating to deposits between a person resident in india and a person resident outside india, namely. Reserve bank of india foreign exchange management act. The foreign exchange management act, 1999 fema is an act of the parliament of india to. The 2015 amendment to section 48 of the arbitration act has. Fema regulations prior rbi seek approval for certain categories of capital account. Fema started after the fera act was repealed fera was the previous trade policy that discouraged foreign currency in an economy and insulated the economy from being an open economy as industrial reforms in 1991 replacing of fera with fema is. Feb 24, 2012 the foreign exchange management act 1999 or in short fema has been introduced as a replacement for earlier foreign exchange regulation act fera.
Crystallization of inoperative foreign currency deposits regulations, 2014. Fema high court ruling 2015tiol2256hcmadfema a n dyaneswaran vs director of enforcement dated. Fera foreign exchange regulation act was passed in 1947 which was amended in 1973. What is fera, what is fema, brief explanation for nris. The scheme was introduced in february 2004 and its regulations are provided under foreign exchange management act fema, 1999. These notifications take effect from the date of issue of press notes press releases, unless specified otherwise therein. The foreign exchange management act 1999 or in short fema has been introduced as a replacement for earlier foreign exchange regulation act fera. Fera was mainly formulated to deal with deep crunch of foreign exchange post world war ii and hence was a rigid piece of legislation which have left all the businesspeople and indian citizens at the mercy of enforcement directorate as violence of fera was considered a criminal act and there. Fem export and import of currency regulations, 2015. M receipt from and payment to, a person resident outside india regulation 2000. Act, 1973 read with subsections 3 and 4 of fema act, 1999. It classifies foreign exchange transaction and current account transactions. Fema or foreign exchange management act was introduced in the year 1999 to replace fera foreign exchange regulations act. Foreign exchange management act, 1999 fema came into force with effect from june 1, 2000.
Archived from the original pdf on 9 september 2012. The foreign exchange management act, 1999 fema is 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. The procedural instructions are issued by the reserve bank of. Fema was intoduced because the fera did not fit in with the postliberalization. The effect of the 2015 amendments to the arbitration act has been well explained by the supreme court in its judgment of 31 august. It was amended by the foreign exchange regulation amendment act 1993 and later in 2000, was replaced by fema. Insights daily current events, 07 february 2015 insightsias.
Latest current affairs and news current affairs today. Practical issues in foreign transactions fema an overview. The foreign exchange regulation act, 1973 fera the foreign exchange management act 1999 fema object conservation of foreign exchange. The criminal appeal deserves to be dismissed and it is dismissed. The agreement is expected to be signed at a meeting of transport ministers of the four countries to be held soon this year. Amendment rules, 2015, every drawal of foreign exchange for transactions included in. As their name specifies, fera lays emphasis on the regulation of currencies, whereas the fema manages foreign exchange, i. Foreign exchange regulation act 1973, 43 of 1973 restriction on holding of immovable property outside india no person resident in india shall, except with the general or special permission of the reserve bank, acquire or hold or transfer or dispose of by sale, mortgage, lease, gift, settlement or otherwise, any immovable property situate. Need to consolidate and amend the law relating to foreign exchange with the objectives of facilitating external trade and. Transactions in india rupees with resident of nepal and bhutan f. Fema case laws india foreign exchange laws case study. This was meant to close all the loopholes and drawback of fera and hence major economic reforms were introduced under this act.
Fema report 321 very easytoread, brief summary of public assistance program policies public assistance policy digest october 2001 pdf 1mb, txt 207kbfor printing pdf 2mbfema report 322 replaces fema 286. An act 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. Transition from foreign exchange regulation act, 1973 to foreign exchange management act, 1999 post liberalization i. The no fear act requires that federal agencies be accountable for violations of antidiscrimination and whistleblower protection laws. Fera imposed strict regulations on transactions involving foreign exchange and. Practical issues in foreign transactions fema an overview nehru place cpe study circle. Foreign exchange management act, 1999 42 of 1999 and in supersession of.
Fema high court ruling 2015 tiol2256hcmad fema a n dyaneswaran vs director of enforcement dated. Advocate, high court, bangalore the foreign exchange regulation act of 1973 fera repealed on 1 june, 2000, replaced by the foreign exchange management act fema, passed in the winter session of parliament in 1999 enacted in 1973, in the backdrop of acute shortage of foreign exchange in the country fera had a. Clause a shall stand substituted date to be notified by act 20 of 2015, s. This was meant to close all the loopholes and drawback of fera and hence major economic reforms were. Sep 14, 2011 fera was enacted in september 1973 and it came in force from january 1, 1974. Title iicomprehensive study of disaster costs and losses sec. Overview of foreign exchange management act section description 1 application and commencement of fema w. Foreign exchange management act was enactedin1999 with 25 original notifications came into force with effect from june 1, 2000. Fera was repealed in 1998 by the government of atal bihari vajpayee and replaced by the foreign exchange management act, which liberalised foreign exchange controls and restrictions on foreign investment.
Officials from india, bangladesh, bhutan and nepal met recently to finalize a motor vehicles agreement mva. There was a demand for substantial modification in fera owing to economic liberalization and improving foreign exchange reserve positions, which lead to new act, foreign exchange management act, 1999. The foreign exchange regulation act fera of 1973 in india was replaced on june. Difference between fera and fema explained day today gk. Aug 12, 2017 fera is an act which is enacted to regulate payments and foreign exchange in india, is fera.
The objective of facilitating external trade and payments for promoting the orderly development and maintenance of foreign exchange market in india. Cs shantanu pethe ca cs cma coach 101,349 views 16. Difference between fera and fema formulation of fema. In exercise of the powers conferred by clause b of subsection 3 of section 6 and section 47 of the foreign exchange management act, 1999 42 of 1999 and in supersession of. Transactions in foreign exchange were absolutely prohibited excepting in. The government of india formulated fema or foreign exchange management act to encourage the external payments and across the border trades in india. Foreign exchange regulation act, 1974 or fera was introduced in the year 1974 with. Popularly known as fema the act is the bible of all forex transactions that happen in the country it is the holy rule book of foreign exchange transactions and of the administration part too. Transition from foreign exchange regulation act, 1973 to foreign exchange management act, 1999 intention was to bring provisions of fera in line with emerging trends of liberalization so as to remove obstacles in the inward flow of foreign exchange and foreign investment. Foreign exchange management transfer or issue of security by a person resident outside india regulations, 2017. This act seeks to make offences related to foreign exchange civil offences. The foreign exchange regulation act, 1973 fera the foreign exchange management act 1999 fema.
907 1031 458 55 1219 558 898 313 1210 1334 131 1060 482 1395 1050 872 55 1116 1531 664 1518 1324 68 460 1102 219 1207 1098 1482 1351 961 1049 1262 1109 1212 1487 107 8 1289 560 1434 167 360 872 952 714