25-08-2017, 09:32 PM
Foreign Exchange Management Act (FEMA)
Foreign Exchange.docx (Size: 16.26 KB / Downloads: 31)
FERA and FEMA - Comparison
• SIMILARITIES
• DIFFERENCES
• CHANGES / PROGRESSION FROM FERA TO FEMA - A STEP AHEAD
Similarities
The similarities between FERA and FEMA are as follows:
• The Reserve Bank of India and central government would continue to be the regulatory bodies.
• Presumption of extra territorial jurisdiction as envisaged in section (1) of FERA has been retained.
• The Directorate of Enforcement continues to be the agency for enforcement of the provisions of the law such as conducting search and seizure
A Step ahead From FERA To FEMA
Enactment of FEMA has brought in many changes in the dealings of Foreign Exchange, as compared to FERA. Some of them are restrictive, and some has widened the scope.
However some of the relevant progress made, from FERA to FEMA, are as follows:
Withdrawal of Foreign Exchange
Now, the restrictions on withdrawal of Foreign Exchange for the purpose of current Account Transactions, has been removed. However, the Central Government may, in public interest in consultation with the Reserve Bank impose such reasonable restrictions for current account transactions as may be prescribed.
FEMA has also by and large removed the restrictions on transactions in foreign Exchange on account of trade in goods, services except for retaining certain enabling provisions for the Central Government to impose reasonable restriction in public interest.