What are the main objectives of Foreign Exchange Management Act?
The main objective for which FEMA was introduced in India was to facilitate external trade and payments. In addition to this, FEMA was also formulated to assist orderly development and maintenance of the Indian forex market.
What is Foreign Exchange Management Act 1999?
o the taking out of India to a place outside India any goods, o provision of services from India to any person outside India; • “foreign currency” means any currency other than Indian currency; • “foreign exchange” means foreign currency and includes,- o deposits, credits and balances payable in any foreign currency.
What are the main provisions of FEMA 1999?
What are the major provisions covered in FEMA, 1999?
- Dealing in foreign exchange, etc.
- Holding of foreign exchange, etc.
- Current account transactions.
- Capital account transactions.
- Export of goods and services.
- Realization and repatriation of foreign exchange.
- Exemption from realization and repatriation in certain cases.
What is FEMA and its objectives?
The primary objective of FEMA act was “facilitating external trade and payments and promoting the orderly development and maintenance of foreign exchange market in India”. FEMA was enacted by the Parliament of India in the winter session of 1999 to replace the Foreign Exchange Regulation Act (FERA) of 1973.
What do you mean by foreign exchange management?
Foreign exchange management is the process of limiting a company’s exposure to foreign currency fluctuations. In most cases, this is done by companies that engage in foreign trade.
How does foreign exchange management Act work?
The Foreign Exchange Management Act, 1999 (FEMA), is an Act of the Parliament of India “to consolidate and amend the law relating to foreign exchange with the objective of facilitating external trade and payments and for promoting the orderly development and maintenance of foreign exchange market in India”.
Is responsible for enforcement of the Foreign Exchange Management Act 1999?
Reserve Bank of India (RBI) makes regulations for FEMA and the rules are made by Central Government. Authorities governing the enforcement of FEMA: Foreign Exchange Department of Reserve Bank of India (RBI) – fema.rbi.org.in.
What is the main provision of Foreign Exchange Management Act 2000?
This law’s main objective is to increase the flow of foreign exchange in India. Now , under this law , you can bring foreign currency in India without any legal barrier . According to section 3 of FEMA 2000 ,” only authorized person under the govt. terms can deal in foreign exchange in India .
What is the jurisdiction of FEMA Act 1999?
FEMA extends to the whole of India. It also applies to all branches, offices and agencies outside India, which are owned or controlled by a person resident in India, in this respect FEMA can be said to acquire extra-territorial jurisdiction.
What are the salient features of FEMA?
What are the features of FEMA? FEMA gives power to the central government for imposing restrictions on activities like making payments to a person situated outside of the country or receiving money through them. Apart from this, foreign exchange as well as foreign security deals are also restricted by FEMA.
What are the three major functions of the foreign exchange market?
The following are the important functions of a foreign exchange market:
- To transfer finance, purchasing power from one nation to another.
- To provide credit for international trade.
- To make provision for hedging facilities, i.e., to facilitate buying and selling spot or forward foreign exchange.
What was the objective of the foreign exchange Management Act?
3. FERA vs FEMA The objective of FERA was to conserve forex and prevent its misuse. The objective of FEMA is to facilitate external trade and payments and maintenance of foreign exchange in India. Violation of FERA was considered a criminal offence.
How is foreign exchange Management Act ( FEMA ) checked?
This criteria is checked by the number of days a person stays in India for more than 182 days in the preceding financial year. Central Government has the authority given by FEMA to impose restrictions on and supervise three things which are- payments made to any person outside India or receipts from them, forex and foreign security deals.
What was the Foreign Exchange Regulation Act of 1973?
In the backdrop of acute shortage of Foreign Exchange in the country, the Foreign Exchange Regulation Act of 1973 (FERA) was enacted. This legislation was passed by the Indian Parliament by the government of Indira Gandhi but it came into force with effect from January 1, 1974.
Which is the best foreign exchange management exam?
We provide all important questions and answers for all Exam. 37. Foreign Exchange Management Act Passed int he year 38. Euro was launched on 39. In a _________ transaction the quoting bank parts with foreign currency and acquires home currency 40.