Foreign Exchange Management Foreign currency accounts by a person resident in India Regulations, In exercise of the powers conferred by Section 9 and clause e of sub-section 2 of section 47 of the Foreign Exchange Management Act, 42 of , and in supersession of Notification No. Save as otherwise provided in the Act or rules or regulations made there under, no person resident in India shall open or hold or maintain a foreign currency account:.

Provided that a Foreign Currency Account held or maintained before the commencement of these Regulations by a person resident in India with special or general permission of the Reserve Bank, shall be deemed to be held or maintained under these Regulations:.

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Provided further that the Reserve Bank, may on an application made to it, permit a person resident in India to open or hold or maintain a Foreign Currency Account, subject to such terms and conditions as may be considered necessary. However, such resident Indian relative joint account holder shall not be eligible to operate the account during the life time of the resident account holder.

A unit located in a Special Economic Zone may open hold and maintain a Foreign Currency Account with an authorized dealer in India provided that,. Provided that the funds held in these accounts shall not be lent or made available in any manner to any person or entity resident in India not being a unit in Special Economic Zones. An Authorized Dealer Category-I bank in India may allow firms and companies who comply with the eligibility criteria stipulated in the Foreign Trade Policy of Government of India, in force from time to time and the directions as may be issued by Reserve Bank of India, from time to time, to open, hold and maintain Diamond Dollar Accounts DDAs in India subject to the terms and conditions of the DDA Scheme specified in Schedule II.

A person resident in India, being an exporter who has undertaken a construction contract or a turnkey project outside India or who is exporting services or engineering goods from India on deferred payment terms may open, hold and maintain a Foreign Currency Account with a bank in India, provided that -. Provided that the credits to such accounts are only by way of freight or passage fare collections in India or from his principal outside India.

Provided that the Indian investee company has impending foreign currency expenditure and the account shall be closed immediately after the requirements are completed and in no case shall be operational for more than six months from the date of opening of such account. Provided further that the restriction contained in clause b of the first proviso shall not apply in a case where —. A person resident in India, being an exporter who has undertaken a construction contract or a turnkey project outside India or who is exporting services or engineering goods from India on deferred payment terms may open, hold and maintain a Foreign Currency Account with a bank outside India, provided that -.

An Indian party may open, hold and maintain Foreign Currency Account abroad for the purpose of making overseas direct investments subject to the following terms and conditions:.

The Indian party is eligible for making overseas direct investment in terms of Foreign Exchange Management Transfer or Issue of Any Foreign Security Regulations, as amended from time to time.

The host country regulations stipulate that the investment into the country is required to be routed through a designated account.

For the purpose of this regulation, the expression 'Indian party' shall have the same meaning as assigned to it in Foreign Exchange Management Transfer or Issue of any Foreign Security Regulations, The account may be used for putting though all transactions connected with or arising from remittances eligible under this Scheme.

Provided that all credits from India into the account shall be made in accordance with the Act, Rules and Regulations made thereunder. Provided further that on his return to India, after completion of studies, such an account will deemed to have been opened under the Liberalised Remittance Scheme. Unless otherwise specified in these Regulations, a Foreign Currency Account with an authorised dealer in India under these Regulations may be opened, held and maintained:.

Provided that the EEFC account referred to in Regulation 4 A , shall be opened, held or maintained in a manner as prescribed by the Reserve Bank from time to time. A resident nominee of an account held outside India in accordance with Regulation 5 shall close the account and bring back the proceeds to India through banking channels.

Schedule I See Sub-Regulation A of Regulation 4.

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However, the amount so withdrawn in rupees cannot be re-credited to the account. However, such resident Indian relative s shall not be eligible to operate the account during the life time of the resident account holder.

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Schedule II See Sub — regulation E of Regulation 4. Firms and companies may open and maintain DDA with AD Category—I banks, subject to the following terms and conditions: Realisation of export proceeds from shipments of rough, cut, polished diamonds and diamond studded jewellery.

Payment for purchase of cut and polished diamonds, coloured gemstones and plain gold jewellery from local sources. The above transactions are subject to the provisions of the Foreign Trade Policy of Government of India, issued from time to time. The relevant particulars are furnished below: We confirm that we are not maintaining any foreign currency account, excluding EEFC account, with banks in India or abroad.

We declare that we are not maintaining more than 5 DDAs including the one proposed to be opened with your branch. We declare that we are neither on the caution list of exporters of Reserve Bank of India nor on the defaulters list of Export Credit Guarantee Corporation of India Ltd ECGC. Skip to main content. Search the Website Search. Home About Us Notifications Press Releases Speeches Publications Annual Half-Yearly Quarterly Bi-monthly Monthly Weekly Occasional Reports Lectures Statistics Data Releases Database on Indian Economy.

Short title and commencement: Restriction on holding foreign currency account by a person resident in India: Provided that a Foreign Currency Account held or maintained before the commencement of these Regulations by a person resident in India with special or general permission of the Reserve Bank, shall be deemed to be held or maintained under these Regulations: B Resident Foreign Currency Account: E Diamond Dollar Accounts DDAs An Authorized Dealer Category-I bank in India may allow firms and companies who comply with the eligibility criteria stipulated in the Foreign Trade Policy of Government of India, in force from time to time and the directions as may be issued by Reserve Bank of India, from time to time, to open, hold and maintain Diamond Dollar Accounts DDAs in India subject to the terms and conditions of the DDA Scheme specified in Schedule II.

G Other cases 1 The Indian agent of a shipping or an airline company incorporated outside India, may open, hold and maintain a Foreign Currency Account with an authorized dealer in India for meeting the local expenses in India of such airline or shipping company: Opening, holding and maintaining a Foreign Currency Account outside India: D For making Overseas Direct Investment An Indian party may open, hold and maintain Foreign Currency Account abroad for the purpose of making overseas direct investments subject to the following terms and conditions: The Indian party is eligible for making overseas direct investment in terms of Foreign Exchange Management Transfer or Issue of Any Foreign Security Regulations, as amended from time to time The host country regulations stipulate that the investment into the country is required to be routed through a designated account.

The account shall be opened, held and maintained as per the regulation of the host country. Remittances out of the account after the account holder's death: Responsibility of authorised dealers maintaining foreign currency accounts: B P Kanungo Principal Chief General Manager Schedule I See Sub-Regulation A of Regulation 4 Exchange Earner's Foreign Currency EEFC Account Scheme 1. Limit up to which foreign currency may be credited to EEFC account 1 A person resident in India may credit to the EEFC Account with an Authorised Dealer in India percent of the foreign exchange earnings as specified here under: Permissible debits to the EEFC account Following debits may be made to an EEFC Account, namely - i Payment outside India towards a current account transaction in accordance with the provisions of the Foreign Exchange Management Current Account Transactions Rules, and towards a capital account transaction permissible under the Foreign Exchange Management Permissible Capital Account Transactions Regulations, Schedule II See Sub — regulation E of Regulation 4 Diamond Dollar Account DDA Scheme 1.

Realisation in US Dollars from local sale of rough, cut and polished diamonds.

Transfer to rupee account of the exporter. Published in the Official Gazette of Government of India — Extraordinary — Part-II, Section 3, Sub-Section i dated All Months January February March April May June July August September October November December.

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