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Opening holding and maintaining a Foreign Currency Account outside India

Regulation 5 - Regulation - FEMA - Regulation 5 - 5. :- (A) Accounts of authorised dealers or their branches (1) An authorised dealer in India may open, hold and maintain with his branch or head office or correspondent outside India, a Foreign Currency Account for the purpose of transacting foreign exchange business and other matters incidental thereto, in accordance with the provisions of the Act or the rules or regulations made or the directions issued thereunder. (2) A branch outside India of .....

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porate registered or incorporated in India (hereinafter referred to as the Indian entity ) may open, hold and maintain in the name of its office (trading or non-trading) or its branch set up outside India or its representative posted outside India, a foreign currency account with a bank outside India by making remittances from India for the purpose of normal business operations of the office/ branch or representative; Provided that - (a) the overseas branch/ office has been set up or representat .....

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tive; and (ii) 10 per cent of such average annual sales/ income or turnover during the last financial year where the remittances are made to meet recurring expenses of the branch or office or representative; (c) the overseas branch/ office/ representative shall not enter in any contract or agreement in contravention of the Act, Rules or Regulations made thereunder; (d) the account so opened, held or maintained shall be closed, (i) if the overseas branch/ office is not set up within six months of .....

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ce is set up or representative posted by a 100% Export Oriented Unit (EOU) or a unit in Export Processing Zone (EPZ) or in a Hardware Technology Park or in a Software Technology Park, within two years of establishment of the Unit. Explanation: For the purpose of this sub-Regulation, 1) Purchase of acquisition of office equipment and other assets required for normal business operations of the overseas branch/ office/ representative will not be deemed as a capital account transaction; 2) Transfer .....

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ent terms may open, hold and maintain a Foreign Currency Account with a bank outside India, provided that - a) approval as required under the Foreign Exchange Management (Export of goods and services) Regulations, 2015 has been obtained for undertaking the contract/ project/ export of goods or services, and b) the terms and conditions stipulated in the letter of approval have been duly complied with. (D) For making Overseas Direct Investment An Indian party may open, hold and maintain Foreign Cu .....

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d maintained as per the regulation of the host country. (d) The remittances sent to the account by the Indian party should be utilized only for making overseas direct investment into the Joint Venture/ Wholly Owned Subsidiary (JV/ WOS) abroad. (e) Any amount received in the account by way of dividend and/ or other entitlements from the subsidiary shall be repatriated to India within 30 days from the date of credit. (f) The Indian party should submit the details of debits and credits in the accou .....

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assigned to it in Foreign Exchange Management (Transfer or Issue of any Foreign Security) Regulations, 2004." 3[(E) Accounts in respect of Startups An Indian startup or any other entity as may be notified by the Reserve Bank in consultation with the Central Government, having an overseas subsidiary, may open a foreign currency account with a bank outside India for the purpose of crediting to it foreign exchange earnings out of exports/ sales made by the said entity and/ or the receivables, .....

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17, 2016 issued by Department of Industrial Policy and Promotion, Ministry of Commerce and Industry, Government of India.] 1[(F)] Other Cases (1) Subject to compliance with the conditions in regard to raising of External Commercial Borrowings (ECB) or raising of resources through American Depository Receipts (ADRs) or Global Depository Receipts (GDRs), the funds so raised may, pending their utilisation or repatriation to India, be held in deposits in foreign currency accounts with a bank outsid .....

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the expenditure incidental to the insurance/reinsurance business carried on by them and for that purpose, credit to such account the insurance/reinsurance premia received by them outside India. ] (4) Resident individuals may open, maintain and hold foreign currency accounts with a bank outside India for making remittances under the Liberalised Remittance Scheme (hereinafter referred to as the Scheme ). The account may be used for putting though all transactions connected with or arising from rem .....

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) A person resident in India who has gone abroad for studies may open, hold and maintain a Foreign Currency Account with a bank outside India during his stay outside India. Provided that all credits from India into the account shall be made in accordance with the Act, Rules and Regulations made thereunder. Provided further that on his return to India, after completion of studies, such an account will deemed to have been opened under the Liberalised Remittance Scheme. (7) A person resident in Ind .....

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