REPORTING

Reporting under Foreign Exchange Management Act, 1999

(Last updated on 12th May 2023)

Foreign Exchange Management Act, 1999 (FEMA) is administered through the authorised persons and is based on the declarations and averments made to them by persons while undertaking the transactions. The Reserve Bank, therefore, has prescribed various reports and forms under FEMA to be submitted by/ through Authorised Persons/ Authorised Dealer Category – I Banks/ Authorised Banks. Accurate compilations and timely submission of these reports are of critical importance as they not only act as a supervisory tool but also help in fine-tuning the policies relating to foreign exchange transactions regulated under FEMA.

(Please refer to the Master Direction for Annexures stipulated)

Details are summarised as under:

Part I: Remittance Facilities
(i) Money Changing Activity
Authorised Money Changers (AMCs) are entities, authorised by the Reserve Bank under Section 10 of the Foreign Exchange Management Act, 1999. An AMC is a Full Fledged Money Changer (FFMC). In addition to Authorised Dealer Category -I Banks (AD Category–I Banks) and Authorised Dealers Category – II (ADs Category–II), Full Fledged Money Changers (FFMCs) are also authorised by the Reserve Bank to deal in foreign exchange for specified purposes in order to widen the access of foreign exchange facilities to residents and tourists and ensuring efficient customer service through competition. FFMCs are authorised (a) to purchase foreign exchange from non-residents visiting India and residents; and (b) to sell foreign exchange for certain approved purposes. AD Category –I Banks / ADs Category – II / FFMCs may appoint franchisees to undertake purchase of foreign currency.
Prescribed Forms/ Returns:
(a) Application Form for FFMC licence under section 10(1) of FEMA, 1999 (Annex I)
(b) The Reserve Bank permits AD Category – I Banks, ADs Category – II and FFMCs to enter into [franchisee (also referred as agency)] agreements at their option for the purpose of carrying on Restricted Money Changing (RMC) business i.e. conversion of foreign currency notes, coins or travellers’ cheques into Indian Rupees. They are required to obtain information from the franchisee in Form RMC-F (Annex II), scrutinise the same and keep it on record.
(c) Registers in respect of the money-changing transactions to be maintained by AMCs:
(i) Daily Summary and Balance Book (Foreign currency notes / coins) in form
FLM 1 (Annex-III).
(ii) Daily Summary and Balance Book (Travelers’ cheques) in form FLM 2 (AnnexIV).
(iii) Register of purchases of foreign currencies from the public in form FLM 3 (Annex-V).
(iv)Register of purchases of foreign currency notes / coins from authorized dealers and authorized money changers in form FLM 4 (Annex-VI).
(v) Register of sales of foreign currency notes / coins and foreign currency
travelers’ cheques to the public in form FLM 5 (Annex-VII).
(vi) Register of sales of foreign currency notes / coins to authorized dealers / Full Fledged Money Changers / overseas banks in form FLM 6 (Annex-VIII).
(vii) Register of travelers’ cheques surrendered to authorized dealers / authorized money changers / exported in form FLM 7 (Annex-IX).
(viii) FLM 8 (Annex-X).
(ix)
(x) Quarterly Statement showing summation of Foreign Currency Account opened in India out of export proceeds of Foreign Currency Notes/ encashed Travelers’ Cheques (Annex XII)
(xi) Annual Statement of the amount of foreign currency written off during
afinancial year (Annex XIII)
(xii) Profoma giving Information about New Directors/ Change of Directors of the FFMC / non-bank AD Category – II (Annex XIV)

(ii) Money Transfer Service Scheme (MTSS)
Money Transfer Service Scheme (MTSS) is a quick and easy way of transferring personal remittances from abroad to beneficiaries in India. Only inward personal remittances into India such as remittances towards family maintenance and remittances favouring foreign tourists visiting India are permissible. No outward remittance from India is permissible
under MTSS. The system envisages a tie-up between reputed money transfer companies abroad known as Overseas Principals and agents in India known as Indian Agents who would disburse funds to beneficiaries in India at ongoing exchange rates. The Indian Agent is not allowed to remit any amount to the Overseas Principal. Under MTSS the remitters and the beneficiaries are individuals only.
The reporting requirements are given below:
a. List of Sub Agents, Overseas Principal-Indian Agent wise (Annex XV): Indian Agents should forward a full updated list (names and addresses and their location) of their Sub Agents by e-mail, in excel format, in soft form, to the concerned FED Regional Office, whenever they appoint/ remove any Sub Agent. Indian Agents should visit the RBI website and verify the list of Sub Agents on regular intervals and any aberration to the list observed may immediately be brought to the notice of the concerned FED ROs. Further, Indian Agents should confirm the veracity, on quarterly basis, of the list
placed on RBI website to their respective FED ROs, either in form of a letter or by email, within 15 days from the end of a quarter.
b. List of additional locations: To be furnished by the Indian Agents to the ROs concerned of the FED of the Reserve Bank, under whose jurisdiction their registered offices fall, on quarterly basis, within 15 days from the close of the quarter to which it relates.
c. Quarterly statement of the quantum of remittances received (Annex XVI): To be furnished by the Indian Agents 1using the eXtensible Reporting Language (XBRL) (https://secweb.rbi.org.in/orfsxbrl/) within 15 days from the close of the quarter.
d. Half-yearly statement of the collateral held as at the end of June and December every year (Annex-XVII): To be furnished by the Indian Agents to the ROs concerned of the FED of the Reserve Bank, under whose jurisdiction their registered offices fall, within 15 days from the close of the half-year to which it relates.

(iii) Rupee Drawing Arrangements (RDA)
Under the Rupee Drawing Arrangements (RDAs), cross-border inward remittances are received in India through Exchange Houses situated in Gulf countries, Hong Kong, Singapore, Malaysia (for Malaysia only under Speed Remittance Procedure) and all other countries which are FATF compliant (for all other countries which are FATF compliant only under Speed Remittance Procedure).
The reporting requirement is given below:
a. Application (Annex XVIII): AD Category–I banks should apply to the Reserve Bank in the form provided at Annex XVIII with necessary documents the first time they enter into RDAs with non-resident Exchange Houses from Gulf countries, Hong Kong, Singapore, Malaysia and all other countries which are FATF compliant, for opening and maintaining in India the Rupee vostro accounts of those non-resident Exchange Houses.
b. Statement A (Annex XIX): This monthly Exchange House-wise statement is designed to elicit details of operations in Rupee/ foreign currency vostro accounts of Exchange Houses. This statement should be critically examined to ascertain whether funds held in the account are adequate to cover estimated pipeline debits. The Top Management of the ADs Category-I may work out the pipeline data and set their own limits and the adherence to the limits set should be informed to the Top Management on a quarterly basis.
c. Statement B (Annex XX): This is a consolidated half-yearly statement showing position of Rupee/ foreign currency vostro accounts of Exchange Houses which are to be closed/ are in the process of closure.
d. Statement C (Annex XXI): This is a monthly statement giving information regarding Exchange House’s account held at overseas branches of Indian banks under Draft Drawing Arrangement (DDA)/ Non-DDA procedures for holding collection proceeds and additional collaterals.
e. Statement D (Annex XXII): This monthly statement provides information about operations in the foreign currency vostro account of the Exchange House.

f. Statement E (Annex XXIII): This quarterly statement on total remittances received every quarter is required to be submitted 3using the eXtensible Reporting Language (XBRL) system (https://secweb.rbi.org.in/orfsxbrl/) before 15th of the succeeding month to which the quarter relates.
g. Annual Review: AD Category-I banks should submit to the respective Regional Office of the Foreign Exchange Department of the Reserve Bank of India, under whose jurisdiction the registered office of the applicant falls by 30th June every year an annual review note covering the period January 1 to December 31 of the previous year, on the vostro accounts of the Exchange Houses maintained by them under the Rupee/ Foreign Currency Drawing Arrangements (RDAs/ FcyDAs) duly approved by their Board. The Review Note should cover various aspects like (a) credit-worthiness
of the Exchange House (based on financial statements and market reports), (b) validity of licenses of Exchange Houses and compliance of home country KYC/ AML /CFT Guidelines by Exchange Houses (c) financial losses suffered if any by the AD category –I bank on account of transactions, events, disputes, etc., (d) business turnover separately under each arrangement, (e) funding arrangements in respect of vostro accounts, (f) half-yearly inspection of the account of the Exchange House, (g) supervision (system in vogue to monitor operations in the account), (h) internal control and risk management system, (i) overdrafts and interest collected. An extract
of directions, if any issued by the Board should be forwarded to the Reserve Bank along with the Annual Review note. While submitting the annual review note, the particulars such as (a) complete particulars of Drawing Arrangements (DDA/ NonDDA / Speed Remittance) that the AD Category-I banks have with Exchange Houses with the date of approval by RBI and opening of the vostro accounts (b) dates of termination of Drawing Arrangements, if any (including Drawing Arrangements which
could not be concluded), and (c) number of drawee branches under each
arrangement should be included.

Part II: Liberalised Remittance Scheme
Resident individuals are permitted to make remittances up to USD 250,000 per financial year for any permitted current or capital account transactions or a combination of both as per the regulations prescribed under the Foreign Exchange Management (Current Account Transactions) Rules, 2000, as amended from time to time, and the Foreign Exchange Management Act, 1999 (FEMA) or the rules or regulations framed thereunder.

  1. AD Category – I banks are required to furnish the information on remittances made under the Liberalised Remittance Scheme (LRS) on a monthly basis, on or before the fifth of the following month to which it relates through Online Returns Filing System (ORFS) for which purpose they have been given user ID and password by the Reserve Bank. Where
    there is no data to furnish, AD banks are advised to upload ‘nil’ figures in the ORFS system.
  2. In addition, AD Category-I banks are required to furnish the transaction wise information under LRS on a daily (T+1) basis i.e. by the close of business of the next working day. In case no data is to be furnished, AD banks should upload ‘Nil’ report. AD banks can upload the LRS data as CSV file (comma delimited), by accessing XBRL site through the URL
    https://secweb.rbi.org.in/orfsxbrl/ as hitherto.
    AD banks may use the stipulated purpose codes while reporting transactions under LRS.
  1. Transactions relating to LRS are required to be reported in Foreign Exchange Transactions Electronic Reporting System (FETERS) to Department of Statistics and Information Management (DSIM) under respective FETERS purpose codes (e.g. travel, medical treatment, purchase of immovable property, studies abroad, maintenance of close
    relatives; etc.) instead of reporting collectively under the purpose code S0023. This would help AD banks in classification of transactions for similar activity under single purpose code. Therefore, the purpose code S0023 may be read as ‘Opening of foreign currency account abroad with a bank.’
  2. AD banks should continue to ensure that the data pertaining to LRS transactions reported by them in FETERS tallies with that reported by them in ORFS and XBRL.

Part III: Establishment of Branch Office (BO)/ Liaison Office (LO) / Project Office (PO) or any other place of business in India by foreign entities
Applications from foreign companies (a body corporate incorporated outside India, including a firm or other association of individuals) for establishing BO/ LO/ PO in India are considered by the AD Category-I bank as per the guidelines issued by Reserve Bank of India under the provisions of Foreign Exchange Management Act, 1999.
The reporting requirements are given below:

  1. Annual Activity Certificate
    i. The Annual Activity Certificate (AAC) (Annex I) as at the end of March 31 along with the audited financial statements including receipt and payment account are required to be submitted to the designated AD Category – I bank and a copy of the same to the Director General of Income Tax (International Taxation), Drum Shape Building, I.P. Estate, New Delhi 110002, by the BO/LO on or before September 30 of every year. In case the annual accounts of the BO/LO are finalized with reference to a date other than March 31, the AAC along with the
    audited financial statements may be submitted within six months from the due date of the Balance Sheet to the designated AD Category – I bank with a copy to the Director General of Income Tax (International Taxation), Drum Shape Building, I.P. Estate, New Delhi 110002.
    The AAC is to be submitted by the:
    a. BO/ LO concerned, in case of a sole BO/ LO;
    b. Nodal office of the BOs/ LOs, in case of multiple BOs / LOs – a combined
    AAC in respect of all the offices in India.
    ii. AAC from a Chartered Accountant showing the project status and certifying that
    the accounts of the project office have been audited and the activities
    undertaken are in conformity with the general/ specific permission given by Reserve Bank of India may be submitted by the PO to the designated AD Category-I bank.
  1. AD Category-I bank shall send a consolidated list of all the BOs/LOs/ POs opened and closed by them during a month (as per Annex II), by the fifth of the succeeding month, to the General Manager, Reserve Bank of India, Central Office Cell, Foreign Exchange Department, Sansad Marg, New Delhi-110 001.
  4. Entities from Bangladesh, Sri Lanka, Afghanistan, Iran, China, Hong Kong, Macau or Pakistan which are setting up a BO/LO/PO in India should register with the state police authorities and are required to submit an annual report (as per Annex III) within five working days of the BO/LO/PO becoming functional to the Director General of Police
    (DGP) of the state concerned in which the BO/LO/PO has established its office; If there is more than one office of such a foreign entity, a separate annual report is required to be submitted to each of the DGP concerned of the state where the office has been established.

Part IV: Foreign Investment
A. Reports
Foreign Direct Investment (FDI) in India is undertaken in accordance with the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2017 issued vide Notification No. FEMA 20(R)/2017-RB dated November 07, 2017 [hereinafter referred to as FEMA 20(R)]. FEMA 20(R), amongst other things, prescribes the modes of investments i.e. issue or acquisition of capital instruments [capital
instruments as defined in FEMA 20(R)], manner of receipt of funds, pricing guidelines and reporting of the investments made under it.
All the reporting prescribed under this direction, except specifically stated otherwise, is required to be done through the Single Master Form (SMF) available on the FIRMS platform at https://firms.rbi.org.in.The user manual for reporting is available on the website www.rbi.org.in. The format of the SMF and KYC report is available in the user manual.
For the purpose of reporting in the SMF, an Indian entity which has received foreign investment or indirect foreign investment or expects to receive it, is required to file an entity master on the FIRMS platform. The procedure for filing the entity master is available on the website www.rbi.org.in.
The reporting formalities for foreign investment are given below:
1) Reporting for issue of capital instruments
a) Reporting inflows:
(i) The actual inflows on account of issue of capital instruments shall be reported by the AD branch in the R-returns in the normal course.
b) Reporting of issue of Equity instruments:

(i) Foreign Currency – Gross Provisional Return (FC- GPR)26:An Indian company issuing equity instruments to a person resident outside India, and where such issue is reckoned as Foreign Direct Investment under NDI Rules, 2019, shall report such issue in Form FC-GPR 27in the Single Master Form not later than thirty days from the date of issue of the equity instruments. Issue of ‘participating interest/ rights’ in oil fields shall be reported in Form FC-GPR.

(ii) The following cases / instances of issue of shares / equity instruments to persons resident outside India by an Indian company will require filing of Form FC-GPR, (a) bonus or rights shares directly or on amalgamation/ merger/ demerger 29with an existing Indian company (b) equity instruments on account of a cross border merger in terms of Notification 389/ 2018 dated March 20, 2018; (c) shares against any funds payable by the Indian company to the person resident outside India; (d) sweat equity shares and shares issued upon exercise of employees stock option in terms of NDI Rules, 2019; (e) Issue of shares on conversion of convertible notes.

(iii)Allotment of equity instruments under public issue or Qualified Institutional Placement (QIP) under the applicable SEBI Regulations need not be reported in Form FC-GPR

(iv) In case the Indian company issues equity instruments to a person resident outside India other than to the person resident outside India from who the inward remittance has been received, the form FC-GPR has to be filed along with the following documents:

(a) KYC reports of both the remitter and the beneficial owner.

(b) A no-objection certificate (NOC) from the remitter for issuing equity instruments to the beneficial owner mentioning their relationship.

(c) A letter from the beneficial owner explaining the reason for the remitter making remittance on its behalf.

(d) A copy of agreement / board resolution from the investee company for issuing equity instruments to a person other than from who the remittance has been received.

c) Annual Return on Foreign Liabilities and Assets:

An Indian company which has received FDI or an LLP which has received investment by way of capital contribution in the previous year(s) including the current year, shall submit form FLA to the Reserve Bank on or before the 15th day of July of each year. Explanation: Year for this purpose shall be reckoned as April to March. The FLA return can be filed through a web-portal interface https://flair.rbi.org.in provided by RBI to the reporting entities for submitting “User Registration Form”. The successful registration on web-portal will enable users to generate RBI-provided login-name and password for using FLA submission gateway and would include system-driven validation checks on submitted data. The User Manual and FAQs present on the web-portal can be used for further guidance to file the FLA return.

2) Reporting for Transfer of equity instruments

a) The actual inflows and outflows on account of transfer of shares shall be reported by the AD branch in the R-returns in the normal course.

b) Foreign Currency-Transfer of Shares (FC-TRS) :

1) Form FCTRS is required to be filed for transfer of equity instruments40 in accordance with NDI Rules, 2019, between: (i) a person resident outside India holding equity instruments in an Indian company on a repatriable basis and person resident outside India holding equity instruments on a non-repatriable basis; and (ii) a person resident outside India holding equity instruments in an Indian company on a repatriable basis and a person resident in India, The onus of reporting is on the resident transferor/ transferee or the person resident outside India holding equity instruments on a non-repatriable basis, as the case may be.

2) Transfer of equity instruments in accordance with NDI Rules, 2019 41between a person resident outside India holding equity instruments on a non-repatriable basis and person resident in India is not required to be reported in Form FC-TRS.

3) Transfer of equity instruments on a recognized stock exchange by a person resident outside India as prescribed under NDI Rules, 2019 has to be reported by such person in Form FC-TRS.

4) Transfer of equity instruments prescribed in Rule 9(6) of NDI Rules, 2019 viz., payment on deferred basis, shall be reported in Form FC-TRS to the AD bank on receipt of every tranche of payment. The onus of reporting shall be on the resident transferor/ transferee.

5) Transfer of ‘participating interest/ rights’ in oil fields shall be reported in Form FC-TRS.

6) Form FCTRS is required to be filed by the Indian company buying back shares in a scheme of merger/ de-merger/ amalgamation of Indian companies approved by NCLT/ competent authority.
7) The form FCTRS has to be filed with the AD bank within sixty days of transfer of capital instruments or receipt/ remittance of funds whichever is earlier.


c) Know Your Customer (KYC):

The sale consideration in respect of equity instruments purchased by a person resident outside India, remitted into India through normal banking channels, is subject to a KYC check by the remittance receiving AD bank at the time of receipt of funds. In case, the remittance receiving AD bank is different from the AD bank handling the transfer transaction, the KYC check shall be carried out by the remittance receiving AD bank and the KYC report be submitted by the transferor/transferee to the AD bank carrying out the transaction along with the Form FC-TRS. d) In case the foreign remitter and the beneficial owner are different, the conditions (a) to (c) laid down at Para A (1)(b)(iv) of this part shall apply mutatis-mutandis.

4) Reporting of conversion of ECB into equity
Details of issue of shares against conversion of ECB have to be reported to the Regional Office concerned of the Reserve Bank, as indicated below:
(i) In case of full conversion of ECB into equity, the company shall report the conversion in Form FC-GPR as well as in Form ECB-2 (Part V: Annex III) to the Department of Statistics and Information Management (DSIM), Reserve Bank of India, Bandra Kurla Complex, Mumbai – 400 051, 40Contact numbers 022-26572513 and 022- 26573612, within seven working days from the close of month to which it relates. The words “ECB wholly converted to equity” shall be clearly indicated on top of the Form ECB-2. Once reported, filing of Form ECB-2 in the subsequent months is not necessary.
(ii) In case of partial conversion of ECB, the company is required to report the converted portion in Form FC-GPR as well as in Form ECB-2 clearly differentiating the converted portion from the non-converted portion. The words “ECB partially converted to equity” shall be indicated on top of the Form ECB-2. In the subsequent months, the outstanding balance of ECB shall be reported in Form ECB-2 to DSIM.
5) Reporting of ESOPs and sweat equity shares An Indian company issuing employees’ stock option (ESOP) to persons resident outside India who are its employees/ directors or employees/ directors of its holding
company/ joint venture/ wholly owned overseas subsidiary/ subsidiaries shall file FormESOP45 within 30 days from the date of issue of ESOPs.

6) Reporting of ADR/GDR Issues – Form DRR
The domestic custodian shall report the issue/ transfer of sponsored/ unsponsored depository receipts as per DR Scheme 2014 in Form DRR within 30 days of close of the issue/ program.
7) Reporting requirements of Limited Liability Partnerships
a) Form FDI- LLP (I): A Limited Liability Partnerships (LLPs) receiving amount of consideration for capital contribution and acquisition of profit shares is required to submit a report in Form Foreign Direct Investment-LLP (I) within 30 days from the date of receipt of the amount of consideration. The form shall be accompanied by:
(i) copy/ies of the FIRC/s evidencing the receipt of the remittance
(ii) a KYC report in respect of the foreign investor in the format specified in.
b) Form FDI- LLP (II): The LLPs shall report disinvestment/ transfer of capital contribution or profit share between a resident and a non-resident (or vice versa) within 60 days from the date of receipt of funds in Form Foreign Direct Investment-LLP(II).
8) Reporting of issue or transfer of Convertible Notes – Form CN
a) A startup company issuing Convertible Notes (CNs) to a person resident
outside India shall file Form CN within 30 days of issue.
b) Omitted and taken to FCGPR.
c) Transfer of Convertible Notes of a startup company by way of sale between a person resident in India and a person resident outside India shall be reported by the transferor/transferee, resident in India, in Form CN within 30 days of such transfer.

d) The AD bank shall ensure due diligence with regards to KYC of the foreign investor/ buyer.
9) Reporting of foreign portfolio investment
9.1 Investment other than by NRIs/ OCIs
a) Reporting Form LEC(FII): The AD banks have to ensure that the FPIs registered with SEBI who are investing under schedule 2 of FEMA 20(R) and all investment (other than that made by NRIs/ OCIs) which is considered as Foreign Portfolio Investment within the meaning of regulation 2(xix) of FEMA 20(R) is reported in Form LEC(FII). It would be the bank’s responsibility to ensure that the data submitted to Reserve Bank is
reconciled by periodically taking a FPI holding report for their bank.
b) The Indian company which has issued shares to FPIs which is considered as FDI within the meaning of regulation 2(xvii) of FEMA 20(R) shall be reported in Form-FCGPR.
9.2 Investment by NRIs/ OCI
The designated link office of the AD bank shall furnish to the Reserve Bank, a report on a daily basis, for their entire bank, investments made by NRIs/ OCIs which is considered as Foreign Portfolio Investment within the meaning of regulation 2(xix) of FEMA 20(R). It would be the banks responsibility to ensure that the data submitted to Reserve Bank is
reconciled by periodically taking a NRI holding report for their bank.

10) Downstream Investment:
Form DI: An Indian entity or an investment vehicle making downstream investment in another Indian entity which is considered as indirect foreign investment for the investee company in terms of Regulation 14 of FEMA 20 (R) read with Para 9 of Master Direction – Foreign Investment shall file form DI with the Reserve Bank within 30 days from the date of allotment of capital instruments.

11) Investment by Foreign Venture Capital Investor (FVCI)
Investment in equity instruments by FVCIs in terms of Schedule VII to NDI Rules, 2019 is required to be reported in 71Form FC-GPR and transfer of capital instruments between an FVCI and a person resident in India in terms of the Schedule, ibid, is required to be filed in Form FC-TRS. Since pricing guidelines are not applicable for Schedule VII investments, valuation certificate need not be insisted upon.
12) Investment by persons resident outside India in units of an Investment Vehicle
An Investment vehicle which has issued its units to a person resident outside India in terms of Schedule VIII of NDI Rules, 2019 shall file Form InVI within 30 days from the date of issue
of units

Part V: External Commercial Borrowing (ECB)
Indian companies are allowed to access funds from abroad in the following methods:
(i) External Commercial Borrowings (ECB)
(ii) Foreign Currency Convertible Bonds (FCCBs)
(iii) Preference shares
(iv) Foreign Currency Exchangeable Bonds (FCEBs)
ECB can be accessed under two routes, viz., (i) Automatic Route outlined in
paragraph and (ii) Approval Route.
The reporting requirements are given below:
1) Application for raising ECB under the Approval Route and for allotment of Loan Registration Number (LRN) for ECB – Form ECB (Annex I):
2) Reporting of actual transactions of ECB – ECB 2 Return (Annex II)
3) Form for reporting of details of Trade Credit – Form TC (Annex III)
4) Statement on Guarantee/ Letter of Undertaking/ Letter of Comfort issued by AD banks in respect of Trade Credit (Annex IV)

Part VI: Non-resident Foreign Accounts
1) Monthly statement on remittances made from NRO Accounts (Annex I):
With a view to having access to more real time data, information on the details of remittances made by NRIs/ PIOs/ Foreign nationals out of the NRO accounts is collected on a monthly basis. AD – Category I banks are required to furnish the statement in the requisite format to General Manager-in-Charge, Foreign Exchange Department, Foreign Investments Division (NRFAD), Reserve Bank of India, Central Office Cell, Parliament Street, New Delhi 110 001 within 7 days of the end of the reporting month.
2) The accounts opened by an authorised dealer or an authorised bank in respect of individual/s of Bangladesh nationality should be reported by it to its Head Office and the Head Office of such authorised dealer/ authorised bank should forward a quarterly report containing details of Name of the Individual(s), Passport Number, Issuing Country/State, Name of the FRO/ FRRO, Date of issue of Residential Permit and validity thereof, to the Ministry of Home Affairs (Foreigners Division) on Quarterly basis”.
3) Return on non-resident deposits (Annex II): Authorised Banks maintaining nonresident deposits are required to submit detailed monthly data on non-resident deposits to the Reserve Bank of India in NRD-CSR package, the format of which is at Annex II
(available at ttps://rbidocs.rbi.org.in/rdocs/content/pdfs/19APDR_AN10813.pdf ).
For monthly NRD-CSR submission on XBRL platform by nodal office of banks, the Reserve Bank has provided the following two alternatives:
(a) Banks can download the RBI’s NRD-CSR template by logging to the RBI’s
Online Reporting web-page (http://orfs.rbi.org.in) (Path: Homepage → XBRLbased filing → (enter user name / password) → Download Returns Package →
Form NRD-CSR) and use the same to generate instance document (.xml file)
after entering details. The instance document can be uploaded on RBI’s XBRL
page. The Reserve Bank (DSIM, CO) will provide User name and Password to
all banks for NRD-CSR for this purpose.
(b) Banks can use any publically available XBRL tool in relation with their internal database and build NRD-CSR discipline prescribed by RBI, for generation of instance document (.xml file) and upload the same on RBI’s XBRL page.

In addition, banks can also generate instance document in the prescribed format from their internal system, if it provides such flexibility.

Part VII: Immovable Property
Form IPI (Annex I): A person resident outside India who has established in India, a branch, office or other place of business in accordance with the Foreign Exchange Management (Establishment in India of a Branch Office or a Liaison Office or a Project Office or any other Place of Business) Regulations, 2016, as amended from time to time, for carrying on in India any activity, excluding a liaison office, and acquires any immovable property in India, which is necessary for or incidental to carrying on such activity, is required to file with the Reserve Bank, a declaration in the form IPI as prescribed by Reserve Bank from time to time, not later than ninety
days from the date of such acquisition.

Part VIII: Overseas Direct Investment (ODI)

Part VIII: Overseas Investment (OI): The overseas investment framework has been rationalised by issuance of the Foreign Exchange Management (Overseas Investment) Rules, 2022 (hereinafter referred to as ‘OI Rules’) notified vide Notification No. G.S.R. 646(E) dated August 22, 2022 and Foreign Exchange Management (Overseas Investment) Regulations, 2022 (hereinafter referred to as ‘OI Regulations’) notified vide Notification No. FEMA 400/2022-RB dated August 22, 2022 in supersession of
Notification No. FEMA 120/RB-2004 dated July 07, 2004 (Foreign Exchange Management (Transfer or Issue of any Foreign Security) (Amendment) Regulations, 2004). Consequently, Foreign Exchange Management (Overseas Investment) Directions, 2022 (hereinafter referred to as ‘OI Directions’) have been issued vide A.P. (DIR Series) Circular No.12 dated August 22, 2022.

  1. Accordingly, the revised reporting instructions are as under. In terms of Regulation 10 of the OI Regulations,
    a) A person resident in India,
    (i) who has made Overseas Direct Investment (ODI) or is making any financial commitment or undertaking restructuring or undertaking disinvestment in a foreign entity, shall report it in Form FC
    (ii) who has made ODI shall submit an Annual Performance Report (APR)
    b) A person resident in India other than a resident individual, making any Overseas
    Portfolio Investment (OPI) or transferring such investment by way of sale, shall report
    the same in Form OPI
    c) An Indian Entity which has made ODI, shall submit an Annual Return on Foreign
    Liabilities and Assets (FLA).
  1. Form FC (Annex I): This Form captures information relating to financial commitment including ODI, restructuring and disinvestment by Indian entities (as defined under the OI Rules) and resident individuals, as applicable. The Form has seven sections viz. Section A to G. Brief details of each section are given below.
    Section A Details of the Indian entity/ resident individuals/ Trust/ Society
    Section B Details of the foreign entity/ step-down subsidiaries. Section C Details of transaction/ remittance/ financial commitment of the person resident in IndiaSection D Declaration furnished by the Indian entity/ resident individual, undertaking financial commitmentSection E Certificate by the Statutory Auditors of the Indian entity (IE)/ group companySection F Details to be reported at the time of restructuring of the balance sheet of the foreign entity involving diminution in the total value of the outstanding dues towards the person resident in India on account of investment in equity and debtSection G Details to be reported at the time of disinvestment in the foreign entity by way of sale or transfer of equity capital/ buyback of equity capital/ closure/ liquidation/ winding up/ merger/ amalgamation
  2. Form APR (Annex II): This form captures the change in the share-holding pattern, financial position of the foreign entity, repatriation from the foreign entity and details of step-down subsidiaries.
  3. Form OPI (Annex III): This form has subsumed the erstwhile form for portfolio reporting as provided for listed Indian companies, Mutual Fund (MF), Alternative Investment Fund (AIF)/ Venture Capital Fund (VCF) and Employee Stock Ownership Plan (ESOP) reporting. The form has the following sections.

Section A Details of the Indian entity/ Mutual Fund
Section A.(A) Details of OPI by Indian entity as per Schedule II & proviso (iii) to
Para 2 of Schedule V of OI Rules
Section A.(B) Details of OPI by a resident individual by way of ESOP/ Employee
Benefits Scheme (EBS), (reporting to be done by office/ branch/
subsidiary/ Indian entity concerned) as per Para 1(2)(iii)(h) and
Para 3 of Schedule III of OI Rules)
Section A.(C) Details of OPI by MF as per Para 2 of Schedule IV of OI Rules
Section B Details of OPI by AIF/ VCF as per Para 2 of Schedule IV of OI
Rules
Section C Certificate from Indian entity/ MF/ AIF/ VCF, as the case may be

  1. Form FLA: This form is required to be submitted directly by all the Indian entities
    which have made ODI in the previous year(s) including the current year, to the
    Department of Statistics and Information Management (DSIM), Reserve Bank of India.
    The form FLA is available on RBI’s website viz. www.flair.rbi.org.in and needs to be
    reported by July 15th of every year. AD banks are advised to ensure submission of
    Form FLA due, before undertaking any remittance for the Indian entity.
  2. The forms listed at paragraphs 3, 4 and 5 above, are required to be submitted to the
    designated AD bank as per the format provided in these directions.
    i. Form FC is to be submitted (Sections A,B,C,D &E) by a person resident in India
    making a financial commitment in the foreign entity at the time of undertaking
    outward remittance or financial commitment, whichever is earlier.
    ii. Any restructuring of the balance sheet of the foreign entity involving diminution
    in the total value of the outstanding dues towards a person resident in India who
    has made ODI in the foreign entity, on account of investment in equity or debt,
    shall be reported by such person, in Section F of Form FC within 30 days from
    the date of such restructuring.
    iii. A person resident in India undertaking disinvestment in the foreign entity, shall
    report such disinvestment in Section G of Form FC within 30 days from the date
    of receipt of disinvestment proceeds.
    iv. Form OPI is to be submitted by a person resident in India other than a resident
    individual within 60 days from the end of the half-year (i.e., September or March
    end as the case maybe) in which such OPI or transfer by way of sale is made.
  3. The revised forms and these instructions for filling up the forms shall come into effect
    immediately. The revised forms can also be downloaded from the Reserve Bank’s
    website viz. www.rbi.org.in.
  4. It may be noted that as per Regulation 11(1) of OI Regulations, in case a person
    resident in India does not submit the evidence of investment within the time specified
    under Regulation 9(1) of OI Regulations or does not make any filing within the time
    specified under Regulation 10 of OI Regulations, such person may make such
    submission or filing along with Late Submission Fee (LSF) within such period as may
    be advised. However, such facility can be availed within a maximum period of 3
    years from the due date of such submission or filing
  5. In terms of Regulation 11(2) of OI Regulations, in case a person resident in India responsible for submitting the evidence of equity investment or any filing relating to overseas investment in accordance with the Act or regulations made thereunder before the date of publication of OI Regulations in the Official Gazette, who has not made or did not make such submission or filing within the time specified thereunder, may make such submission or filing along with LSF or make payment of LSF where such submission or filing has been done, as the case may be, within such period as may be advised. However, such facility can be availed within a maximum period of 3 years from the date of publication of OI Regulations in the Official Gazette. The rates and the manner in which LSF may be paid is laid down in paragraph 18 of OI Directions
  6. Any person resident in India, who has not submitted any filing relating to overseas investment specified in accordance with FEMA, 1999, or regulations made thereunder before the date of publication of OI Regulations in the Official Gazette, shall report the same using the revised forms. For such submissions, the corresponding extant Regulations, as stipulated by the Reserve Bank from time to time may be referred.
  7. The forms received by the AD bank should be preserved UIN-wise for onward submission to the Reserve Bank, if and when required.
  8. The AD banks should put in place proper processes and systems and issue necessary instructions to all the dealing officials at the bank/ branch to ensure compliance with these Directions. Further, as envisaged under Regulation 12 of OI Regulations, AD banks shall ensure that a person resident in India who has made a financial commitment in a foreign entity as per FEMA provisions, shall not make any further financial commitment whether fund-based or non-fund-based, directly or indirectly, towards the foreign entity or transfer such investment, till any delay in reporting is regularized. Failure to comply with the reporting requirements, with or without LSF, within the time as specified in the OI Regulations shall lead to a contravention under Section 13 of FEMA, 1999.
  9. Reserve Bank reserves the right to place the information received through the forms in the public domain.

Part IX: Trade
1) Exports
(a) EDF Form (Annex I): Export Declaration Form (EDF) is used to declare
export of goods from Non-EDI ports.
(b) Softex form (Annex II): All software exporters are required to file single as well as bulk SOFTEX form in excel format to the competent authority for certification.
(c) Advance Payments against Long term Exports (Annex III): AD Category- I banks can also allow exporters having a minimum of three years’ satisfactory track record to receive long term export advance up to a maximum tenor of 10 years to be utilized for execution of long term supply contracts for export of goods subject to conditions specified. Receipt of such advance of USD 100 million or more should be immediately intimated to the Trade Division, Foreign Exchange Department, Central Office, Reserve Bank of India.
(d) AD Category –I banks are advised to efficiently follow up with the concerned exporters in order to ensure that export performance (shipments in case of export of goods) is completed within the stipulated time period. It is further reiterated that AD category –I banks should exercise proper due diligence and ensure compliance with KYC and AML guidelines so that only bonafide export advances flow into India. Doubtful cases as also instances of chronic defaulters may be referred to Directorate of Enforcement (DoE) for further investigation.
(e) Omitted
(f) Taking into account the recommendation made by the Technical Committee on Facilities and Services to the Exporters (Chairman: Shri G. Padmanabhan), AD banks were permitted to factor the export receivables on a non-recourse basis, so as to enable the exporters to improve their cash flow and meet their working capital requirements subject to conditions as under: After factoring, the Export Factor may close the export bills and report the same in the Export Data Processing and Monitoring System (EDPMS) of the Reserve Bank of India. (https://www.edpms.rbi.org.in)

(g) Follow-up of Overdue Bills: With operationalization of EDPMS on March 01, 2014, realization of all export transaction for shipping documents after February 28, 2014 should be reported in EDPMS. Details of old outstanding bills, prior to March 01, 2014 as reported by AD banks up to half year ended December 31, 2015 have been migrated to EDPMS. Hence, separate reporting of XOS has been discontinued. AD category – I banks are required to mark off / close the XOS data in EDPMS pertaining to period before (pre) March 01, 2014 as and when amount is realised (https://www.edpms.rbi.org.in)
(h) AD banks should report write off of export bills through EDPMS to the Reserve Bank. (https://www.edpms.rbi.org.in)
(i) EFC (Application for opening foreign currency account with a bank in India or abroad by exporters) (Annex V)
(j) To facilitate e-commerce, it has been decided to permit AD Category-l banks to offer the facility of receipt/payment of/for export proceeds/imports by entering into standing arrangements with the OPGSPs. AD Category-I banks desirous of entering into such an arrangement/s should report the details of each such arrangement as and when entered into to the Foreign Exchange Department, Central Office, Reserve Bank of India, Mumbai.

2) Imports
(a) AD Category – I banks are required to submit a statement on half-yearly basis as at the end of June & December of every year, in form BEF furnishing details of import transactions, exceeding USD 100,000 in respect of which importers have defaulted in submission of appropriate document evidencing import within 6 months from the date of remittance using the online eXtensible Business Reporting Language (XBRL) system on a Bank-wide basis (https://secweb.rbi.org.in/orfsxbrl/) and monitoring & follow up is done by respective Regional Offices of RBI. The Statement should be submitted within 15 days from the close of the half-year to which the statement relates till the half year ended December 2017 and discontinued
thereafter.
(b) Head Offices/ International Banking Divisions of AD Category – I banks are required to submit the following statements under XBRL system:
(i) Statement on half yearly basis (end March/ end September), showing the
quantity and value of gold imported by the nominated banks/ agencies/ EOUs/ SEZs in Gem & Jewellery Sector, mode of payment-wise. (Annex VI).
(ii) Statement on monthly basis showing the quantity and value of gold
imports by the nominated agencies (other than the nominated banks)/ EOUs/ SEZs in Gem & Jewellery sector during the month under report as well as the cumulative position as at the end of the said month beginning from the 1st month of the Financial Year. (Annex VII).
Both the statements shall be submitted, even if there is ‘Nil’ position, by the 10th of the following month / half year, to which it relates.
(c) AD bank should ensure one-to-one matching in case of each Merchanting Trade transaction and report defaults if any, in any leg by the traders to the concerned Regional Office of RBI, on half yearly basis in the format as given in Annex VIII, within 15 days from the close of each half year, i.e. June and December
(d) The AD Category –I bank has to obtain a copy of invoice and airway bill from the OPGSP containing the name and address of the beneficiary as evidence of import and report the transaction in R-Return(to respective regional Office of RBI on a fortnightly basis within 7 days of the end of the fortnight) under the foreign currency payment head for NOSTRO
(https://www.rbi.org.in/upload/notification/pdfs/52215.pdf) & VOSTRO
(https://www.rbi.org.in/upload/notification/pdfs/52216.pdf)

Part X: Guarantees
The reporting requirement in case of guarantees are listed below:

Statement for reporting of non-resident guarantees issued and invoked in
respect of fund and non-fund based facilities between two persons resident in India (Annex I): A non-resident can guarantee fund and non-fund based facilities availed by one resident from another. A reporting format has been prescribed to capture such guarantees issued and invoked. Authorized Dealer Category-I banks are required to furnish such details by all its branches, in a consolidated statement, during the quarter, as per the format in Annex to the Chief General Manager, ForeignExchange Department, ECB Division, Reserve Bank of India, Central Office Building, 11th floor, Fort, Mumbai – 400 001 (and in MS-Excel file through email) so as to reach the Department not later than 10th day of the following month.

Part X: Compounding:
The compounding of contraventions under Foreign Exchange Management Act (FEMA), 1999 is a voluntary process by which an applicant can seek compounding of an admitted contravention of any provision of FEMA, 1999 under Section 13(1) of the FEMA, 1999.
The Forms prescribed are given below:
1) The format of the application (Annex-I).
2) The details of irregularities whether relating to Foreign Direct Investment, External Commercial Borrowings, Overseas Direct Investment and Branch Office/ Liaison Office, as applicable (Annex-II).
3) Undertaking that the applicant is not under investigation of any agency such as DOE, CBI, etc. in order to complete the compounding process within the time frame (Annex-III)
4) Mandate and details of their bank account (Annex IV): In case the application has to be returned for any reason, the application fees of Rs.5000/- received along with the application fees is also returned. To expedite the refund of compounding fees in such cases, it has been decided to credit the same to the applicant’s account through NEFT requiring the obtaining of a mandate.

Part XII: Licensing of NBFCs as AD Category-II
In terms of DNBR notification DNBR (PD) CC.No. 098/03/10/001 dated April 16, 2019, Systemically Important Non-Deposit taking Non-Banking Financial Company – Investment and Credit Companies (NDSI-NBFC-ICCs) fulfilling certain conditions have now been made eligible for an Authorised Dealer Category-II licence under section 10(1) of FEMA 1999.
The NBFCs fulfilling the eligibility conditions and desirous of undertaking activities permitted to an AD Category-II under FEMA, may make an application in the prescribed form (Part XII-Annex) and submit the same to the respective Regional Office of the Foreign Exchange Department of the Reserve Bank under whose jurisdiction the registered office of the applicant NBFC falls.