-
Sections
Rule - 1. Short title and commencement.
Foreign
Exchange Management (Current Account Transactions) Rules, 2000
[Foreign Exchange Management (Current Account Transactions) Rules,
2000][1]
[3rd May, 2000]
In exercise of the powers
conferred by Section 5 and sub-section (1) and clause (a) of sub-section (2) of Section 46 of the Foreign Exchange
Management Act, 1999, and in consultation with the Reserve Bank, the Central
Government having considered it necessary in the public interest, makes the
following rules, namely.
Rule - 1. Short title and commencement.
(1) These rules may be called
the Foreign Exchange Management (Current Account Transactions) Rules, 2000.
(2) They shall come into effect
on the 1st day of June, 2000.
Rule - 2. Definitions.
In these rules, unless the
context otherwise requires,
(a) “Act” means the Foreign
Exchange Management Act, 1999 (42 of 1999);
(b) “Drawal” means drawal of
foreign exchange from an authorised person and includes opening of Letter of
Credit or use of International Credit Card or International Debit Card or ATM
Card or any other thing by whatever name called which has the effect of
creating foreign exchange liability;
(c) “Schedule” means a schedule
appended to these rules;
(d) The words and expressions
not defined in these rules but defined in the Act shall have the same meanings
respectively assigned to them in the Act.
Rule - 3. Prohibition on drawal of Foreign Exchange.
Drawal of foreign exchange
by any person for the following purpose is prohibited, namely.
(a) a transaction specified in
the Schedule I; or
(b) a travel to Nepal and/or
Bhutan; or
(c) a transaction with a person
resident in Nepal or Bhutan:
Provided that the
prohibition in clause (c) may
be exempted by RBI subject to such term and conditions as it may consider
necessary to stipulate by special or general order.
Rule - 4. Prior approval of Government of India.
No person shall draw
foreign exchange for a transaction included in the Schedule II without prior
approval of the Government of India:
Provided that this Rule
shall not apply where the payment is made out of funds held in Resident Foreign
Currency (RFC) Account [2][*
* *] of the remitter.
Rule - 5. Prior approval of Reserve Bank.
No person shall draw
foreign exchange for a transaction included in the Schedule III without prior
approval of the Reserve Bank:
Provided that this Rule
shall not apply where the payment is made out of funds held in Resident Foreign
Currency (RFC) Account [3][*
* *] of the remitter.
Rule - [6.
(1) Nothing contained in Rule 4
or Rule 5 shall apply to drawal made out of funds held in Exchange Earners'
Foreign Currency (EEFC) account of the remitter.
(2) Notwithstanding anything
contained in sub-rule (1), restrictions imposed under Rule 4 or Rule 5 shall
continue to apply where the drawal of foreign exchange from the Exchange
Earners' Foreign Currency (EEFC) account is for the purpose specified in Items
10 and 11 of Schedule II, or Items 3, 4, 11, 16 and 17 of Schedule III, as the
case may be.][4]
Rule - [7. Use of International Credit Card while outside India.
Nothing contained in Rule 5
shall apply to the use of International Credit Card for making payment by a
person towards meeting expenses while such person is on a visit outside India.][5]
SCHEDULE
I
[6][Transactions which are
Prohibited
(See Rule 3)]
(1) Remittance out of lottery
winnings;
(2) Remittance of income from
racing/riding etc. or any other hobby;
(3) Remittance for purchase of
lottery tickets, banned/prescribed magazines, football pools, sweepstakes etc.;
(4) Payment of commission on
exports made towards equity investment in Joint Ventures/Wholly Owned Subsidiaries
abroad of Indian companies;
(5) Remittance of dividend by
any company to which the requirement of dividend balancing is applicable;
(6) [7][Payment of commission on
exports under Rupee State Credit Route, except commission up to 10% of invoice
value of exports of tea and tobacco;]
(7) Payment related to “Call
Back Services” of telephones;
(8) Remittance of interest
income on funds held in Non-Resident Special Rupee Scheme a/c.
SCHEDULE
II
[8][Transactions which
require prior approval of the Central Government
(See Rule 4)]
|
Purpose of
Remittance |
Ministry/Department
of Government of India whose approval is required |
|
|
1. |
Cultural Tours |
Ministry of Human Resources
Development (Department of Education and Culture) |
|
[9][2. |
Advertisement in foreign print media
for the purposes other than promotion of tourism, foreign investments and
international bidding (exceeding US $ 10,000) by a State Government and its
Public Sector Undertakings |
Ministry of Finance, Department of
Economic Affairs.] |
|
3. |
Remittance of freight of vessel
charted by a PSU |
Ministry of Surface Transport
(Chartering Wing) |
|
4. |
Payment of import [10][through
ocean transport] by a Govt. Department or a PSU on c.i.f. basis (i.e. other
than f.o.b. and f.a.s. basis) |
Ministry of Surface Transport
(Chartering Wing) |
|
5. |
Multi-modal transport operators
making remittance to their agents abroad |
Registration Certificate from the
Director General of Shipping |
|
[11][6. |
Remittance of hiring charges of
transponders by— |
|
|
|
(a) TV Channels |
Ministry of Information and
Broadcasting |
|
|
(b) Internet service providers |
Ministry of Communication and
Information Technology] |
|
7. |
Remittance of container detention
charges exceeding the rate prescribed by Director General of Shipping |
Ministry of Surface Transport
(Director General of Shipping) |
|
8. |
[12][* * *] |
|
|
9. |
Remittance of prize money/sponsorship
of sports activity abroad by a person other than International/National/State
Level sports bodies, if the amount involved exceeds US$ 100,000 |
Ministry of Human Resource
Development (Department of Youth Affairs and Sports) |
|
10. |
[13][* * *] |
|
|
11. |
Remittance for membership of P &
I Club |
Ministry of Finance (Insurance
Division) |
SCHEDULE
III
(See Rule 5)
(1) [14][* * *]
(2) [15][Release of exchange
exceeding US $ 10,000 or its equivalent in one financial year for one or more
private visits to any country (except Nepal and Bhutan).
(3) Gift remittance exceeding
US $ 5000 per financial year per remitter or donor other than resident
individual;]
(4) [16][(i) Donation exceeding US $ 5000 per financial year per remitter
or donor other than resident individual;
(ii) Donations by corporate, exceeding one per cent of their
foreign exchange earnings during the previous three financial years or US $ 50,00,000,
whichever is less, for,
(a) creation of Chairs in
reputed educational institutes;
(b) to funds (not being an
investment fund) promoted by educational institutes; and
(c) to a technical institution
or body or association in the field of activity of the donor company.
Explanation. For the purposes of these
Item Numbers 3 and 4, remittance of gift and donation by resident individuals
are subsumed under the Liberalised Remittance Scheme.]
(5) Exchange facilities
exceeding [17][US$
1,00,000] for persons going abroad for employment;
(6) Exchange facilities for
emigration exceeding [18][US$
1,00,000] or amount prescribed by country of emigration;
(7) [19][Remittance for maintenance
of close relatives abroad,
(i) exceeding net salary (after
deduction of taxes, contribution to provident fund and other deductions) of a
person who is resident but not permanently resident in India and is a citizen
of a foreign state other than Pakistan.
(ii) exceeding [20][US$
1,00,000] per year recipient, in all other cases.
Explanation: For the purpose of this
item, a person resident in India on account of his [21][employment
or deputation of] a specified duration (irrespective of length thereof) or for
a specific job or assignment, the duration of which does not exceed three
years, is a resident but not permanently resident;]
(8) Release of foreign
exchange, exceeding US$ 25,000 to a person, irrespective of period of stay, for
business travel, or attending a Conference or specialised training or for
maintenance expenses of a patient going abroad for medical treatment or
check-up abroad, or for accompanying as attendant to a patient going abroad for
medical treatment/check-up;
(9) Release of exchange for
meeting expenses for medical treatment abroad exceeding the estimate from the
doctor in India or hospital/doctor abroad;
(10) Release of exchange for
studies abroad exceeding the estimates from the institution abroad or [22][US$
1,00,000] [23][per
academic year], whichever is higher;
(11) [24][Commission, per
transaction, to agents abroad for sale of residential flats or commercial plots
in India exceeding USD 25,000 or 5% of the inward remittance whichever is
more.]
(12) [25][* * *]
(13) [26][* * *]
(14) [27][* * *]
(15) [28][Remittances exceeding US $
1,00,00,000 per project, for any consultancy services in respect of
infrastructure projects and US $ 10,00,000 per project for other consultancy
services procured from outside India.
Explanation. For the purposes of this
item number ‘infrastructure project’ is those related to
(i) Power,
(ii) Telecommunication,
(iii) Railways,
(iv) Roads including bridges,
(v) Sea port and airport,
(vi) Industrial parks, and
(vii) Urban infrastructure (water
supply, sanitation and sewage).]
(16) [29][* * *]
(17) [30][Remittances exceeding five
per cent of the investment brought into India or US $ 1,00,000 whichever is
higher, by an entity in India by way of reimbursement of pre-incorporation
expenses.]
(18) [31][* * *]
[1] Ministry of Finance (Deptt.
of Economic Affairs), Noti. No. G.S.R. 381(E), dated 3-5-2000, published in the
Gazette of India, Extra., Part II, Section 3(i), dated 4-5- 2000, pp. 8-10, No.
249.
[2] The words “or Exchange
Earner's Foreign Currency (EEFC) Account” deleted by S.O. 301(E), dated 30-3-2001 (w.e.f. 30-3-2001).
[3] The words “or Exchange
Earner's Foreign Currency (EEFC) Account” deleted by S.O. 301(E), dated 30-3-2001 (w.e.f. 30-3-2001).
[4] Ins. by S.O. 301(E), dated
30-3-2001 (w.e.f. 30-3-2001).
[5] Ins. by G.S.R. 33(E), dated
15-1-2003 (w.e.f. 16-1-2003).
[6] Subs. for “(See Rule 3)”by G.S.R. 512(E),
dated 27-7-2005 (w.e.f. 28-7-2005).
[7] Subs. by G.S.R. 397(E), dated
1-5-2003 (w.e.f. 14-5-2003).
[8] Subs. for “(See Rule 4)”by G.S.R. 512(E),
dated 27-7-2005 (w.e.f. 28-7-2005).
[9] Subs. by S.O. 301(E), dated
30-3-2001 (w.e.f. 30-3-2001).
[10] Ins. by G.S.R. 849(E), dated
27-10-2003 (w.e.f. 29-10-2003).
[11] Ins. by S.O. 608(E), dated
13-9-2004 (w.e.f. 13-9-2004). Earlier it was omitted by G.S.R. 442, dated 22-10-2002.
[12] Omitted by S.O. 382(E), dated
5-5-2010 (w.r.e.f. 16-12-2009). Prior to omission it read as:
|
“8. |
Remittances under technical
collaboration agreements where payment of royalty exceeds 5% on local sales
and 8% on exports and lump sum payment exceeds US$ 2 million |
Ministry of Industry and Commerce |
[13] Omitted by S.O. 608(E), dated
13-9-2004 (w.e.f. 13-9-2004). Prior to omission it read as:
|
“10. |
Payment for securing Insurance for
health from a company abroad |
Ministry of Finance (Insurance
Division)” |
[14] Omitted by S.O. 608(E), dated
13-9-2004 (w.e.f. 13-9-2004). Prior to omission it read as:
“1.
Remittance by artiste e.g. wrestler, dancer, entertainer etc. (This restriction
is not applicable to artistes engaged by tourism related organisations in India
like ITDC, State Tourism Development Corporations etc. during special festivals
or those artistes engaged by hotels in five star categories, provided the
expenditure is met out of EEFC account);”
[15] Subs. by G.S.R. 349(E), dated
22-5-2009 (w.r.e.f. 20-12-2006).
[16] Subs. by G.S.R. 349(E), dated
22-5-2009 (w.r.e.f. 30-4-2007).
[17] Subs. by G.S.R. 731(E), dated
5-9-2003 (w.e.f. 11-9-2003).
[18] Subs. by G.S.R. 731(E), dated
5-9-2003 (w.e.f. 11-9-2003).
[19] Subs. by S.O. 301(E), dated 30-3-2001
(w.e.f. 30-3-2001).
[20] Subs. by G.S.R. 731(E), dated
5-9-2003 (w.e.f. 11-9-2003).
[21] Subs. by G.S.R. 397(E), dated
1-5-2003 (w.e.f. 14-5-2003).
[22] Subs. by G.S.R. 731(E), dated
5-9-2003 (w.e.f. 11-9-2003).
[23] Ins. by S.O. 301(E), dated
30-3-2001 (w.e.f. 30-3-2001).
[24] Subs. by S.O. 608(E), dated
13-9-2004 (w.e.f. 13-9-2004).
[25] Omitted by S.O. 608(E), dated
13-9-2004 (w.e.f. 13-9-2004). Prior to omission it read as:
“12. Short term credit to
overseas offices of Indian companies;”
[26] Omitted by S.O. 608(E), dated
13-9-2004 (w.e.f. 13-9-2004). Prior to omission it read as:
“13.
Remittance for advertisement on foreign television by a person whose export
earnings are less than Rs 10 lakhs during each of the preceding two years;”
[27] Omitted by S.O. 608(E), dated
13-9-2004 (w.e.f. 13-9-2004). Prior to omission it read as:
“14.
Remittances of royalty and payment of lump sum fee under the technical
collaboration agreement which has not been registered with Reserve Bank;”
[28] Subs. by G.S.R. 349(E), dated
22-5-2009 (w.r.e.f. 30-4-2007).
[29] Omitted by G.S.R. 412(E),
dated 10-7-2006 (w.e.f. 11-7-2006). Prior to omission it read as:
“16.
Remittance for purchase of trademark or franchise in India;”
[30] Ins. by G.S.R. 349(E), dated
22-5-2009 (w.r.e.f. 30-4-2007).
[31] Omitted by S.O. 608(E), dated
13-9-2004 (w.e.f. 13-9-2004). Prior to omission it read as:
“18.
Remittance of hiring charges of transponders.”