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RBI Eases FEMA Norms to Encourage investment

Published on November 10, 2017
The Reserve Bank of India (RBI) has simplified the Foreign Exchange Management Regulations, by putting all the 93 amendments under one notification.

  • This step will make it easier for foreign investors to invest in the country.
  • The new notification combines two regulations on foreign investments: one which is popularly called investment in an Indian company or a partnership, or in a limited liability partnership, or FEMA 20, and the other — FEMA 24, which is investment in a partnership firm. 
  • Another significant change is the introduction of a late submission fee that could allow an investor to regularise any contravention due to non-reporting, by paying the fee.
  • “It is going to impact in a very big manner because 60-70% of the contravention cases which RBI receives are due to delays in reporting,
  • Any transfer of investment from non-resident Indians to any non-residents has been brought under the automatic route
  • The Foreign Exchange Management Act (FEMA), introduced in 1999, was amended 93 times.

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