FEMA 1999 on Trade Finance


FEMA training

Recently some of leading corporate received notice from Reserve Bank of India for non submission of bill of entry, non fulfilment of export obligations after receiving advance remittances and cases where import of goods not done after sending advance remittance to overseas suppliers. It is also learnt that issuance of bill of entry hard copy is dispensed with.  EDPMS and IDPMS are put to operation.  These are the some of the developments in the recent past.

In the advent of electronic data taking over the export and import transactions most of the guidelines of under FEMA 1999 has been modified.

From the time FEMA was introduced in June 2000, till today lot of relaxations have been introduced by Reserve Bank for smooth facilitation of trade operations.  In most of the cases exchange control administration is decentralized and the Authorized Dealers are being delegated with powers to handle the transactions.

In case of exports, dispatch of documents directly to consignee, reduction in invoice value, write off, netting off export receivables, allowing export through ware house abroad, agency commission remittance, export claims, handling advance remittance and delayed presentation of regulatory documents etc., powers are delegated to Authorized Dealers for approving such transactions subject to certain conditions.

Likewise, import transactions are also liberalized.  Authorized dealers are delegated with requisite powers to approve advance remittance for imports with/without the guarantee from the overseas seller, trade credit transactions (supplier’s credit / buyer’s credit), merchanting trade and high-sea sales transactions etc.,

Regarding outward remittances Authorised Dealers can permit most of the current account transactions and also capital account transactions subject to certain limits.

In spite of the wide range of delegated authority, still there are some gaps in understanding and interpreting these guidelines.

This workshop will exclusively address the changes introduced by Reserve Bank of India through Master Directions and AP DIR circulars with case studies on the following issues.

  • Clear distinction between current and capital account transactions
  • Export related regulatory issues – trade discount, reduction in invoice value, Regulatory waiver, and dispatch of documents directly to the consignee, advance remittance, write off, netting off
  • Import related regulatory issues – time limit for import payment, interest payments, advance remittance for imports, import of services, trade credit – supplier’s credit and buyer’s credit, High sea sales, Merchanting trade.
  • Remittances other than imports

Programme Schedule:

Session 1

Introduction to FEMA 1999 – Distinction between current and capital account transactions – Full convertibility of Indian Rupee – Decentralisation of exchange control administration – Role of Authorised Dealers in handling foreign exchange transactions –

Session 2

FEMA 1999 on export of goods and services – Regulatory compliance – Responsibilities of AD in handling export transactions – Export of services – software exports – Time limit for presentation of export documents – time limit for realizing export payments – change of buyer – extension of time limit – export write off – handling export advance remittances – netting off – direct dispatch of documents to the consignee – GR Waiver – export related remittances – legal expenses, export claims, storage and warehousing charges, demurrage and agency commission – with case studies.

Session 3

FEMA 1999 on Import of goods services – handling advance remittances for imports – responsibilities of an authorised dealer in handling import transactions – time limit for import payments – approved method of payments – submission of documentary evidence – reporting system for import remittances – delayed remittances under AD’s discretionary powers, cases to be referred to RBI, difference between high sea sales and merchanting trade – trade credits – suppliers credit and buyers credit – with case studies

Session 4

Inward remittances – for residents and non residents;

Outward remittances – other than imports

Question and answer session

Target Audience
Who should attend

  • Managers who are handling exports, banking and regulatory compliance
  • Managers who are handling imports and remittances
  • Procurement department dealing with imports
  • Finance personnel who deal with banks and regulatory authorities
  • Bankers who are dealing in trade finance and compliance

How to Register

  • Fees: Rs. 3,500/- + 18% GST per person.
  • Please write to register@princetonacademy.co.in / Call -022 67256200
  • Mention the name of participant, company, contact details .
  • Cheque favoring Princeton Academy Mumbai II Pvt. Ltd. payable at Mumbai.