The Foreign Exchange Management Act (FEMA) was a regulation brought by the Indian government in 1991 in order to regulate cross-border Forex Transactions. It replaced the much more stringent Foreign Exchange Regulation Act (FERA) and was aimed at fostering a more liberal economy in India. FEMA details the procedures for all Forex Transactions in India. Some of the entities or transactions that FEMA applies to are as follows:
- Foreign Exchange.
- Export or Import of any good or service from or to India.
- Purchase, sale, and exchange (cross-border transactions).
- Indian citizens residing within or outside India (Non-Resident Indians).
- Securities as defined under Public Debt Act 1994.
Though FEMA intends to facilitate the transactions, among others and is not nearly as restrictive as FERA was, it is still one of the most stringent laws in the country. For businesses indulging in Forex Transactions, being compliant with it is a must. Falling afoul of this law may mean hefty penalties.
Some transactions are prohibited by FEMA, while others require government approval before they can go through. Still, others may require the permission of the Reserve Bank of India. Further, the rules associated with the foreign exchange are quite dynamic and need to keep pace with the change in forex rules by other countries. Given this sensitive and dynamic nature, it becomes imperative for businesses to ensure that they remain FEMA Compliant. Companies can setup a team for doing the same or can outsource the function to a FEMA Advisory.
Boston Financial Advisory Group (BFAG) is a firm that offers FEMA Advisory Services. They have a skilled team that understands the complexity of the regulation and its applicability to both inbound and outbound transactions. With their support, a company can easily navigate the intricacies of forex compliance.
The team at Boston Financial Advisory Group is an expert at managing compliance. They use advanced technological tools to track changes in regulation and how it can impact your business. They undertake a systematic analysis of all Forex Transactions of your company, thereby ensuring compliance with rules. They also flag your company if it is violating norms under FEMA. If there is some flouting of regulation, they suggest necessary precautionary measures to rectify the issue.
This in-depth analysis of all Forex Transactions, from the perspective of compliance, ensures that your company can carry out its business normally without any intrusion by regulatory authorities. The team at BFAG can help you with compliance under the following four heads:
- Foreign Direct Investment
- Overseas Direct Investment
- Liberalized Remittance Scheme
- External Commercial Borrowing
Do reach out to them for support on queries related to forex advisory.
So, get in touch with us to avail our services.
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Visit our website: www.bostonfagroup.com