Fema Compliances | Startup India Registration Online

By Author: NIshant
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Foreign Exchange Management Act, 1999 (FEMA) is the legislation that governs foreign currency transactions in and out of India. The main aim of FEMA is to facilitate cross-border trade, the balance of payments, promote the orderly development of fair trade, and ensure effective compliance with relevant laws.

Mandatory compliances as per the FEMA, 1999:

Annual Return on Foreign Liabilities And Assets

Every Indian Resident company that has made a Foreign Direct Investment (FDI) in the preceding year, including the current year, must submit the Foreign Liabilities and Assets (FLA) Return. If no such investment is made, then the company is not under any obligation to submit the FLA. Such a return must be submitted every year.

Annual Performance Report

Annual Performance Report is submitted by those Indian Party or Resident Individual who has made an Overseas Direct Investment (ODI). Annual Performance Report is provided in Form ODI Part II to the AD bank in respect of Joint Venture, Wholly Owned Subsidiaries (WOS) outside India on or before 31st December every year.

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... External Commercial Borrowing

Borrowers need to report to the RBI regarding all ECB transactions via an AD Category-I Bank in the form of ‘ECB 2 Return’ every month.

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