TMI BlogTRADE CREDITSX X X X Extracts X X X X X X X X Extracts X X X X ..... denominated Trade Credits), as per the framework given in the table below: Sr. No. Parameters FCY denominated Trade Credits INR denominated Trade Credits I Forms of Trade Credit Buyers Credit and Suppliers Credit. Ii Eligible borrower Person resident in India acting as an importer. Iii Amount under automatic route (i) Up to USD 150 million or equivalent per import transaction for oil/gas refining marketing, airline and shipping companies . (ii) For others than (i) , up to USD 50 milli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s . Benchmark rate plus 250 bps spread. Vii Exchange rate Change of currency of FCY Trade Credits into INR Trade Credits can be at the exchange rate prevailing on the date of the agreement between the parties concerned for such change or at an exchange rate, which is less than the rate prevailing on the date of agreement, if consented to by the Trade Credit lender. For conversion to Rupee, exchange rate shall be the rate prevailing on the date of settlement. viii Hedging provision The entities raising Trade Credits are required to follow the guidelines for hedging, if any, issued by the concerned se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with applicable provisions of SEZ Act, 2005 as amended from time to time. For Trade Credit transactions related to SEZ, date of transfer of ownership of goods will be treated as Trade Credits date . As there will be no bill of entry for sale transactions within SEZ , the inter unit receipt generated through NSDL can be treated as an import document. 4. Security for Trade Credit: The provisions regarding security for raising Trade Credits are as under: 1. Bank guarantees may be given by the Authorised Dealers, on behalf of the importer, in favour of overseas lender of Trade Credits not exceeding the amount of Trade Credits. Period of such guarantee cannot be beyond the maximum permissible period for Trade Credi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions contained in Foreign Exchange Management (Acquisition and Transfer of Immovable Property in India) Regulations, 2018 and Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2017, as amended from time to time, or any other relative Regulations framed under the Foreign Exchange Management Act, 1999 and should also comply with applicable FDI/FII/SEZ policy/ rules/ guidelines. Note: The directions on issuance of corporate or personal guarantee mentioned under this provision shall come into force from the date of publication, in the Official Gazette, of the relative Regulations issued under FEMA. 5. Reporting requirements: Trade Credits transactions are subject to the follo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a on issuance of bank guarantees for Trade Credits by all its branches, in a consolidated statement, at quarterly intervals on the XBRL platform . For the above purpose Authorised Dealer banks may login to the site https://secweb.rbi.org.in/orfsxbrl/ using their User name, Password and Bank code. For downloading the relevant form, Authorised Dealer banks may follow the link Download Returns Package and download the form. After following the successive steps , Authorised Dealer banks may upload the file. For User name and Password, Authorised Dealer banks may write at [email protected] along with contact details. Clarification required, if any, may also be sent to the aforesaid email of the Reserve Bank and/ or may be comm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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