In exercise of
the powers conferred by clause (h) of sub-section (2) of Section 47 of the Foreign
Exchange Management Act, 1999 (42 of 1999), the Reserve Bank hereby makes the
following amendments in the Foreign Exchange Management (Foreign Exchange Derivative
Contracts) Regulations, 2000, (Notification
No.FEMA 25/RB-2000 dated May 3, 2000), namely:-
1. Short
Title and Commencement:
(i) These Regulations may
be called the Foreign Exchange Management (Foreign Exchange Derivative Contracts)
(Amendment) Regulations, 2007.
(ii) These regulations shall come into force
on the dates specified hereunder @.
2. Amendment
of Regulation 6 - In the Foreign Exchange Management (Foreign Exchange
Derivative Contracts) Regulations, 2000 (Notification No. FEMA 25/RB-2000 dated
May 3, 2000), (hereinafter referred to as ‘the principal regulations’), in Regulation
6, in sub-regulation (ii), the words 'imported/exported by it' shall be omitted
and shall be deemed to have been omitted with effect from 31st day
of May, 2007.
3. Insertion of new Regulation 8
– In the principal regulations, after Regulation 7, the following new regulation
shall be inserted and shall be deemed to have been inserted with effect from the
23rd day of July, 2005, namely :-
' 8. Remittance
related to a Commodity Derivative Contract - An authorised dealer in India
may remit outside India foreign exchange in respect of a transaction, undertaken
in accordance with these Regulations, in the following cases, namely : -
(a)
option premium payable by a person resident in India to a person resident outside
India;
(b) remittance by a person resident in India of amount
incidental to a commodity derivative contract entered into in accordance with
Regulation 6,
(c) any other remittance related to a commodity
derivative contract approved by Reserve Bank. '
4. Amendment
of the Schedules - In the principal regulations,
(i)
in Schedule I, after paragraph 'A', the following new paragraph shall be inserted
and shall be deemed to have been inserted with effect from the 13th
day of December, 2006, namely :-
' AA. Forward Contract
in respect of Economic Exposure - A person resident in India may, subject
to such terms and conditions as may be stipulated by the Reserve Bank from time
to time, enter into a forward contract with an authorised dealer in India to hedge
an economic exposure to exchange risk in respect of such transactions as may be
prescribed by the Reserve Bank from time to time.'
(ii)
in Schedule II, in paragraph 1, for clause (b), the following shall be substituted
and shall be deemed to have been substituted with effect from the 8th
day of February 2007, namely :-
' (b) forward contracts
may be cancelled and rebooked subject to such terms and conditions as may be stipulated
by the Reserve Bank from time to time, or may be rolled over on or before maturity.'
(Salim
Gangadharan)
Chief General Manager
Footnote:-
1.
@ It is clarified that no person will be adversely affected as a result
of retrospective effect being given to these regulations.
2.
The principal regulations were published in the Official Gazette vide GSR No.411(E)
dated May 8, 2000 in Part II, Section 3, sub-section (i) and subsequently amended
vide -
GSR No.756(E) dt. 28.9.2000,
GSR No.264(E) dt.
09.4.2002,
GSR No.579(E) dt. 19.8.2002,
GSR No.222(E) dt. 18.3.2003,
GSR
No.532(E) dt. 09.7.2003,
GSR No.880(E) dt. 11.11.2003,
GSR No.881(E) dt.
11.11.2003.
SR No.750(E) dt. 28.12.2005.
GSR No.222(E) dt. 19.4.2006, and
GSR
No.223(E) dt. 19.4.2006