(For Internal Circulation Only

)

HANDBOOK ON

FEMA REGULATIONS
IMPORTS & EXPORTS

STATE BANK STAFF COLLEGE
HYDERABAD (An ISO 9001:2000 Certified Institution)
FEBRUARY 2009

(For Internal Circulation Only)

HANDBOOK ON

FEMA REGULATIONS
IMPORTS & EXPORTS

Compiled by: R. Narotham Reddy,
M.Com, CAIIB, CTF, Ce AML KYC, CDCS,

Member of Faculty, International Banking

STATE BANK STAFF COLLEGE
HYDERABAD (An ISO 9001:2000 Certified Institution)
FEBRUARY 2009

Handbook on FEMA regulations – Imports and Exports Feb’09

State Bank Staff College, Hyderabad

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FOREWORD It gives me immense pleasure in bringing out the fourth edition of ‘Handbook on FEMA Regulations Imports & Exports’. It is updated upto February 2009, incorporating the instructions issued by Reserve Bank of India under FEMA during the last one year. 2. As part of the Government’s efforts to integrate India with the global economy and especially in the wake of the global financial crisis the regulatory framework in the area of foreign exchange is being reviewed frequently and some more liberalization has been brought out during the last quarter of 2008. To enable our staff dealing with Imports and Exports at authorised branches and TFCPCs, to handle their jobs more effectively, this book had been compiled to contain all the FEMA regulations in a handbook form. It was first brought out in January 2006 and based on the encouraging feedback, its second and third updated editions were brought out in January 2007, January 2008 and now the fourth and updated edition. 3. The Handbook details the important FEMA regulations concerning Imports and Exports and is designed to assist the staff in their day-to-day work. The users should, nevertheless, take into account any latest changes in the instructions and circulars issued by Govt., RBI and our Foreign Department. 3. I am sanguine that this volume, just as the earlier editions, will be well received by the Forex branches as a very useful reference book. I trust that the staff at our Forex branches will be benefited in handling day to day issues relating to Imports and Exports in an error free and customer friendly manner. I compliment Shri. Narotham Reddy, Faculty of the College for his efforts in compiling and periodically updating this book. Suggestions are welcome to further improve the quality and usefulness of the Handbook.

March 11, 2009

USHA R. NAIR General Manager and Vice Principal

Handbook on FEMA regulations – Imports and Exports Feb’09

State Bank Staff College, Hyderabad

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INDEX
Introduction Part I - Import of Goods
1. General 2. Form A-1 3. Import Licenses i) General ii) Endorsement on Import Licences iii) Preservation of Import Licences iv) Import Licences for C.I.F.Value v) Imports on C.I.F.basis by Government Departments / Public Sector Undertakings 4. Manner of Rupee Payment 5. Letter of Authority holders / Agents of Importers 6. Obligation of Purchaser of Foreign Exchange 7. Time Limit for Settlement of Import Payments 8. Interest on Import Bills 9. RBI’s Instructions on Trade Credits for Imports into India i) General ii) Amount and Maturity iii) All-in-cost Ceilings iv) Guarantee v) Reporting Arrangements 10. Advance Remittance 11. Advance Remittance for Import of Rough Diamonds 12. Advance Remittance for Import of aircrafts / helicopters / other aviation related purchases 13. Remittances for Import of Aircraft /Aircraft Engine/Helicopter on Lease basis 14. Remittances for Import of films on lease / rental basis 15. Advance Remittances for Import of Services
Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College, Hyderabad

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16. Remittances for War Risk Insurance / Bunker /Congestion Surcharge / Premium for extended Insurance 17. Remittances for Imports under Penalty 18. Remittances against Replacement Imports 19. Guarantees for Replacement Import 20. Evidence of Import i) General ii) Imports in non-physical form iii) Imports on D/A basis iv) Issuing acknowledgement v) Verification by auditors vi) Preservation of evidence of Import vii) Certificate from CEO/Auditor of the Company as evidence of import 21. Follow up for Import Evidence 22. Follow up for Import Evidence – Bank’s instructions 23. Import of Equipments by BPO Companies in India for International Call Centre 24. Handling of Import Documents on collection basis 25. Direct Receipt of Import Bills / Documents 26. Direct receipt of Import Bills / Documents - Import of Rough Diamonds 27. Postal Imports 28. Import of Gold/Platinum/Silver by Nominated Banks/Agencies i) Import of Gold on consignment basis ii) Import of Gold on unfixed price basis 29. Direct Import of Gold 30. Import of Gold on Loan basis 31. Import of Gold, Silver and Jewellery by NRIs 32. Import factoring 33. Merchanting Trade 34. Issue of Bank Guarantee on behalf of service importers

Handbook on FEMA regulations – Imports and Exports Feb’09

State Bank Staff College, Hyderabad

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Part II – Export of Goods and Services
1. General 2. Exemptions from Declarations 3. GR Approval for Exports 4. Numbering of Forms 5. Manner of Payment 6. Payments in foreign currency to units in SEZ 7. Guarantees against Exports 8. Foreign Currency Accounts i) Opening of Foreign Currency Accounts ii) Diamond Dollar Account iii) Exchange Earners’ Foreign Currency (EEFC) Account 9. Acquisition of Immovable Property for Overseas Offices 10. Counter-Trade Agreement 11. Export of Goods on Lease, Hire etc. 12. Participation in Trade Fairs Abroad 13. Project Exports and Service Exports 14. Export on Elongated Credit Terms 15. Export of Goods and Services by Units in Special Economic Zones i. Realisation of Export Proceeds ii. Job Works Abroad iii. Receipts of payment in precious metals for EOUs and units in SEZs iv. Netting off of export receivables against import payments v. Issue of equity shares against import of capital goods vi. Purchase of foreign exchange by units in DTAs 16. Forfaiting 17. Disposal of Copies of Export Declaration Forms (GR/PP/SOFTEX forms) 18. Counter Signature on PP forms 19. Terms of Payment – Invoicing (Software) 20. Disposal of SOFTEX Forms
Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College, Hyderabad

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Trade Discount 28. Reduction of Invoice Value on Account of Prepayment of Usance Bills 36. Export Bills Register 34. Differences in Value due to Freight B. Hyderabad 7 . Opening / Hiring Warehouses Abroad 31. Self Write-off. Consolidation of Air Cargo 23. Handing Over Negotiation Copy of Bill of Lading to Master of Vessel/Trade Representative 33. Freight Payment iii. Transfer of Documents C. Differences in Value due to quality analysis / late shipment penalty 27. Part Drawings 30. Exports by Barges/Country Craft/Road Transport 24. Advance Payments against Exports 29. Consignment Exports i. Payment of Freight and marine Insurance ii. Direct Despatch of Shipping Documents 32. Barter Trade with Myanmar 25. Delay in submission of shipping documents by exporters 26. Scrutiny of Export Declaration Forms i. Follow-up of Overdue Bills 35. Reduction in Invoice Value Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Shut out Shipments and Short Shipments 22. Export Claims 38.21. Inter se discrepancies Notes A. Exports to CIS Countries and East European Countries iii. Reduction in Value 37. Bill of Lading/Shipping Bill ii. Change of Buyer/Consignee 39.

Statement on LCs/Guarantees/LOU/LOC issued by AD Category I Banks Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Payment of Claims by ECGC/ insurance companies registered with IRDA 43.PP. Extension of Time Limit in Other Cases 41.SDF. Hyderabad 8 . Shipments Lost in Transit 42. Exporters’ Caution List 46. Remittance of Agency Commission on Exports 47..40.SOFTEX Forms Annex-4 XOS statement Annex-5 Self Write-off and Extension of time – Annual statement to be submitted by exporter Annex-6 Statement of Advance Remittance without bank guarantee or standby letter of credit where the amount of advance is equivalent to or more than USD 5 million for import of Rough Diamonds Annexure -7 Part I : Approvals of Trade Credit granted by all branches during the (Month / Year)………… Part I: Approvals of Trade Credit granted by all branches during the (Month / Year)………. Return of Documents to Exporters 45. (excel format) Annexure-8 Trade Credits . Utilisation and Debt Servicing of Trade Credit during (month) / (year)………. Refund of Export Proceeds Annexures Annex-1 BEF statement Annex-2 Monthly Statement of Gold Imported Annex-3 GR.(excel format) Part II : Disbursement. “Write off” of Unrealised Export Bills 44.

4.except to the extent permitted under any general permission granted under the Regulations. Hyderabad 9 . Reserve Bank has made the Foreign Exchange Management (Export and Import of Currency) Regulations. Policies and procedures required to be followed for Imports to India and Exports from India are announced by the DGFT. counter trade proposals from Indian exporters with Romania involving adjustment of value of exports from India against value of imports made into India in terms of a voluntarily entered arrangement between the concerned parties.R.FEMA 6/RB-2000 dated 3rd May 2000 and subsequently modified vide Notification No. Export of goods and services against repayment of state credits granted by erstwhile Soviet Union will continue to be governed by the extant directions issued by Reserve Bank. as amended from time to time. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. and amended vide Notification No. Any export of Indian currency of value exceeding Rs.I banks have been permitted to issue guarantees on behalf of exporter clients on account of exports out of India. among others that the Indian exporter should utilise the funds for import of goods from Romania into India within six months from the date of credit to Escrow Accounts allowed to be opened. 2000. 2000. functioning under Ministry of Commerce & Industry. Reserve Bank of India under Foreign Exchange Management Act issues directions from time to time bringing out the changes and operational clarifications that are applicable to foreign trade and all AD Category . Reserve Bank will continue to consider as hitherto. 2.S.Introduction Foreign Exchange Management (Current Account Transactions) Rules. 2001. Government of India. AD Category . while undertaking import and export related transactions. will require prior permission of Reserve Bank.FEMA 38 / 2001 – RB dated 27th February. 5. notified vide Reserve Bank Notification No.5000/.381 (E) dated May 3. 3. SO 301 (E) dated March 30.FEMA 8 / RB dated 3rd May 2000. Department of Commerce. G. are required to ensure that these are in conformity with the Foreign Trade Policy in force. Further. 2000 vide its Notification No. Import and Export of goods and services are regulated by the Directorate General of Foreign Trade (DGFT) and its regional offices. 2001. subject to the condition. AD Category .I banks.I banks in Foreign Exchange are required to strictly adhere to these regulations. 2000 were circulated by Government of India vide Notification No. In terms of Regulation 4 of the Foreign Exchange Management (Guarantees) Regulations.

in. etc.I banks may be governed by normal trade practices. In this Handbook. AD Category . The users of this Handbook are required to check for the updates of these regulations.I banks should follow normal banking procedures and adhere to the provisions of Uniform Customs and Practices for Documentary Credits (UCPDC). 8. Where specific regulations do not exist. wherever applicable. Banks are also expected to meticulously adhere to "Know Your Customer" (KYC) guidelines issued by Reserve Bank (Department of Banking Operations & Development) in all their dealings. Financial year' (April to March) is to be reckoned as time base for all transactions pertaining to trade related issues.org. In respect of import of drawings and designs. AD Category .I banks may also advise importers and exporters to ensure compliance with the provisions of Income Tax Act.6. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Hyderabad 10 . while opening letters of credit for import into India on behalf of their constituents. 7. 1986 may be ensured. Further. These circulars are available on Reserve Bank’s website: rbi. 9. compliance with the provisions of Research & Development Cess Act. the rules and regulations from the foreign exchange angle under Foreign Exchange Management Act that are to be followed by Banks (AD Category I banks) while undertaking import and export related transactions on behalf of their clients are only discussed. AD Category . which are brought out by Reserve Bank of India under ‘AP (DIR) Circulars’ series from time to time.

General Rupee accounts maintained in India by citizens of India. Nepal and Bhutan.I banks may freely open letters of credit and allow remittances for import of goods unless they are included in the negative list requiring licence under the Foreign Trade Policy in force. towards imports into India must be made on Form A-1. or against import into these countries made by residents in India. Nepalese and Bhutanese firms. Import Licenses i) General AD Category . companies or other organizations. licences marked ‘For Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. 3. (b) transfer of rupees to non-resident bank accounts. Form A-1 Applications by persons.PART I . residents in Nepal and Bhutan. Directions contained hereunder are also applicable to imports which are financed in rupees and payment for which is made by crediting rupees to a non-resident account in India or to a rupee account maintained by a non-resident bank. firms and companies for making payments. as well as Indian.I bank for verification by Concurrent Auditors/Internal Auditors and not to be forwarded to RBI. exceeding USD 500 or its equivalent. Appropriate A1 form should be obtained and retained by AD Category . Variants of this form have been devised in different colours to be used for – (a) remittance in foreign currency. including Banks functioning in these countries are regarded as resident accounts and rupee transfers to such accounts. and (c) remittance through Asian Clearing Union. is prohibited. Sale of Foreign Exchange for current account transactions# with persons resident in Nepal and/or Bhutan. for imports in to India may be made freely. # Transactions relating to Imports are current account transactions 2. without reference to the Reserve Bank of India. Hyderabad 11 . In such cases.IMPORT OF GOODS 1.

O.I.B.I. Import licences are normally issued for the C. should be retained by AD Category . When imports are made on F. terms the full amount of import licence (of C.F value) cannot be used. ii) Endorsement on Import Licences AD Category . basis by Government Departments/Public Sector Undertakings In cases where imports are made on C. terms and through ocean transport by Government Departments/Public Sector Undertakings. wherever licences have been obtained by importers. iii) Preservation of Import Licences Exchange Control copy of the import licence submitted by importer for opening of Letter of Credit or making remittance. under their stamp and signature.I. Such approvals will not be required by Public Sector Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.I banks and may be preserved till its scrutiny by the internal auditors or inspectors is completed.F. leaving insurance and freight to be settled by the supplier or his agent. they are required to obtain the approval of the Chartering Wing of Ministry of Shipping for payment of imports on C.B.F. b. Imports are sometimes made on F.I. as additional charges over and above the F. ascertain the actual freight amount paid with reference to the original freight bill or memo issued by the shipping company or the amount stated on the relative bill of lading. value a. Hyderabad 12 . value of the goods to be imported.I.O. if any. AD Category . value are to be paid in rupees.F.Exchange Control purposes’ should be called for and special conditions. v) Imports on C. when fully utilised.O.I banks should note to endorse on the ‘Exchange Control Copy’ of import licences. terms and Indian importers agree to the suppliers paying for the freight to be reimbursed to them along with the cost of the goods. basis. attached to such licences adhered to.F.I.F. the details of letters of credit opened or forward contracts booked or remittances made in foreign currency as also the amount of insurance and freight paid by the importer locally in rupees.B.I banks in such cases should before making the remittance of freight charges. iv) Import Licences for C.

the responsibility for production of the Exchange control copy of the Bill of Entry. if any. inter alia.Undertakings/Government Department. must be received by AD Category . In all such cases. irrespective of amount. to open letters of credit or make remittances for payment towards import under the licence (subject to the terms and conditions. will rest on the letter of authority holder or agent. Obligation of Purchaser of Foreign Exchange (a) In terms of Section 10(6) of the Foreign Exchange Management Act. Payments against bills under no circumstances should be accepted in cash. 6. if the mode of transport is other than ocean transport. AD Category . 5. applicable in this regard as per Foreign Trade Policy in force). Manner of Rupee Payment Payments for retirement of bills drawn under letters of credit as well as bills received from abroad for collection against imports into India. by debit to the account of the importer maintained with them or by means of a crossed cheque drawn by the importer on his other bankers. provided the applicant produces a letter of authority obtained from the import licence holder in his favour authorizing him/her. wherever required.I bank under Section 10(5) of the Act or to use it for any other purpose for which acquisition of exchange is permissible under the said Act.I banks.I banks may open letters of credit or make remittances where the Exchange Control copy of the relative import licence has been issued in the name of a party other than the applicant. Hyderabad 13 . 1999 (FEMA). Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. or Rules or Regulations framed there under.I banks may also open letters of credit or make remittances towards imports permitted without licences on behalf of authorised agents of importers. 4. Letter of Authority holders / Agents of Importers AD Category . after satisfying themselves to the Foreign Trade Policy in force that the importers are permitted to utilize services of agents for the imports in question. any person acquiring foreign exchange is permitted to use it either for the purpose mentioned in the declaration made by him to an Authorised Dealer Category .

Interest in respect of such delayed payments may be permitted in terms of the directions in Para 9. AD Category . Time limit for import of books. Deferred payment arrangements including suppliers and buyers credit providing for payments beyond a period of six months from date of shipment upto a period of less than three years are treated as trade credits (Suppliers Credit and Buyers Credit) for which the instructions and procedural guidelines laid down for trade credits (given in para 9) may be followed. is as per the instructions in para 9 (iii).(b) Where foreign exchange acquired has been utilised for import of goods into India the AD Category . Hyderabad 14 .I banks should ensure compliance with the instructions contained in sub-paragraph (a) above.I banks may permit settlement of import dues delayed due to disputes. Time Limit for Settlement of Import Payments (i). as laid down in paragraph 10. 8. 7. (c) In cases payment for import is made by way of credit to resident account of the overseas exporter maintained with a bank in India. interest payment. AD Category . In terms of the extant regulations. (iii). financial difficulties etc. (d) In cases payment for import is made by way of credit to non-resident account of the overseas exporter maintained with a bank in India. remittances against imports should be completed not later than six months from the date of shipment except in cases where amounts are withheld towards guarantee of performance etc. (e) The directions contained in this paragraph are also applicable to payments for imports in to India are made through ACU mechanism. if any. (ii).I bank should ensure that importer furnishes an evidence of import to his satisfaction. provided. AD Category .I banks should ensure compliance with the instructions contained in sub-paragraphs (a) and (b) above. Interest on Import Bills Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Remittances against import of books may be allowed without restriction as to time limit.

Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. RBI’s instructions on Trade Credits for Imports into India i) General ‘Trade Credits’ (TC) refer to credits extended for imports directly by the overseas supplier. whichever is applicable.I banks have no powers to approve trade credit exceeding USD 20 million per import transaction. such trade credits include suppliers’ credit or buyers’ credit. AD Category . remittances may be allowed after deducting the proportionate interest for the unexpired portion of usance at the prevailing LIBOR of the currency of invoice.I banks may allow payment of interest on usance bills or overdue interest for a period of less than three years from the date of shipment at the rates prescribed for trade credits mentioned in the Para 9 (iii). Hyderabad 15 .i) AD Category . remittances may be made only after reducing the proportionate interest for the unexpired portion of usance at the rate at which interest has been claimed or LIBOR of the currency in which the goods have been invoiced. 9.I banks are permitted to approve trade credits for imports into India up to USD 20 million per import transaction for import of all items (permissible under the Foreign Trade Policy in force) with a maturity period (from the date of shipment) up to one year. Where interest is not separately claimed or expressly indicated. It may be noted that buyers’ credit and suppliers’ credit for three years and above come under the category of External Commercial Borrowings (ECB) which are governed by ECB guidelines. while buyers’ credit refers to loans for payment of imports in to India arranged by the importer from a bank or financial institution outside India for maturity of less than three years. bank and financial institution for original maturity of less than three years. ii) Amount and Maturity AD Category . ii) In case of pre-payment of usance import bills. Depending on the source of finance. For import of capital goods. AD Category I banks may approve trade credits up to USD 20 million per import transaction with a maturity period of more than one year and less than three years. Suppliers’ credit relates to credit for imports in to India extended by the overseas supplier. No rollover/extension will be permitted by the AD beyond the permissible period.

subject to prudential guidelines issued by Reserve Bank from time to time. Mumbai – 400 001 (and in MS-Excel file through email to deapdif@rbi. Reserve Bank of India. The allin-cost ceilings will be reviewed from time to time. P. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. 27 dated October 27. reckoned from the date of shipment. Hyderabad 16 . in a consolidated statement. bank and financial institution. 2008) The all-in-cost ceilings include arranger fee. and repayment of trade credit granted by all its branches. if any. Each trade credit may be given a unique identification number by the AD. upfront fee. (A. 8th floor. up to USD 20 million per transaction for a period up to one year for import of all non-capital goods permissible under Foreign Trade Policy (except gold) and up to three years for import of capital goods. Department of Economic Analysis and Policy. in form TC (format in Annex 9) from April 2004 onwards to the Director. Division of International Finance. management fee. utilisation. drawal. Central Office Building.I banks are required to furnish details of approvals.I banks are permitted to issue guarantee/Letter of Undertaking (LoU) /Letter of Comfort (LoC) in favour of overseas supplier.in ) so as to reach not later than 10th of the following month. during the month. The period of such guarantees/LoU/LoC has to be co-terminus with the period of credit. out of pocket and legal expenses. v) Reporting Arrangements AD Category . Fort. (DIR Series) Circular No.org.iii) All-in-cost Ceilings The all-in-cost ceilings are as under: Maturity period All-in-cost ceilings over 6 months LIBOR* Up to one year More than one year but less than three years 200 basis points * for the respective currency of credit or applicable benchmark. iv) Guarantee AD Category . handling / processing charges.

If the amount of advance remittance exceeds USD 100. Mumbai – 400 001 (and in MS-Excel file through email to fedcoecbd@rbi. is obtained.000 (US dollar five million). Reserve Bank of India. ii).org. ECB Division. at quarterly intervals (format in Annex 10) to the Chief General Manager. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Hyderabad 17 . Fort. irrevocable standby Letter of Credit or a guarantee from an international bank of repute situated outside India or a guarantee of an Authorised Dealer in India. it is required to obtain a specific waiver for the bank guarantee from the Ministry of Finance.000.000. A Public Sector Company or a Department/Undertaking of the Central/State Government/s which is not in a position to obtain a guarantee from an international bank of repute against an advance payment. Foreign Exchange Department. iii). 10.I banks are required to furnish data on issuance of Letters of Credit/Guarantees/Letters of Undertaking/Letter of Comfort by all its branches.I banks may frame their own internal guidelines to deal with such cases as per a suitable policy framed by the bank's Board of Directors. AD Category . if such a guarantee is issued against the counter-guarantee of an international bank of repute situated outside India.I banks may allow advance remittance for import of goods without any ceiling subject to the following conditions: (a) i).in) from December 2004 onwards so as to reach the department not later than 10th of the following month. In cases where the importer (other than a Public Sector Company or a Department/Undertaking of the Government of India/State Governments) is unable to obtain bank guarantee from overseas suppliers and the AD Category .AD Category . an unconditional. Central Office Building. the requirement of the bank guarantee/ standby Letter of Credit may not be insisted upon for advance remittances upto USD 5. Government of India before making advance remittance exceeding USD 100.000 or its equivalent. Advance Remittance AD Category . in a consolidated statement.I bank is satisfied about the track record and bonafides of the importer.

Rules or Regulations made there under. by an importer (other Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. The customer’s account is fully compliant with Reserve Bank’s extant KYC / AML guidelines. a representation was made by the Gems and Jewellery Export Promotion Council (GJEPC) for allowing advance remittances without insisting on bank guarantee in respect of import of rough diamonds from five select mining companies of rough diamonds in addition to the Diamond Trading Company Pvt. With a view to liberalising the procedure further and facilitate import of rough diamonds. Hyderabad 18 . 11. v) Physical import of goods into India should be made within six months (three years in case of capital goods) from the date of remittance and the importer should give an undertaking to furnish documentary evidence of import. AD Category – I banks should evidence for import into India..I banks are. Government of India. UK. vi) vii) AD Category – I banks should follow up submission of documentary In the event of non-import of goods. Advance Remittance for Import of Rough Diamonds Based on the Recommendations of the Expert Committee on Gems and Jewellery Sector. ensure that the amount of advance remittance is repatriated to India or is utilised for any other purposes for which release of exchange is permissible under the Act.I banks should undertake the transactions based on their commercial judgment and after being satisfied about the bonafides of the transactions. within fifteen days from the close of the relevant period.(b) All payments towards advance remittance for imports shall be subject to the following conditions: i) ii) The importer is a customer of the AD Category – I bank. Ltd. AD Category . constituted by the Ministry of Finance. iv) Advance payments should be made strictly as per the terms of the sale contract and should be made directly to the account of the manufacturer / supplier concerned.permitted to allow advance remittance without any limit and without bank guarantee or standby letter of credit. KYC and due diligence exercise should be done by the AD Category – I bank for the Indian importer entity as well the overseas manufacturer / supplier. iii) The AD Category .

vii) RIO TINTO. E. v) ALROSA. Russia. 03 dated August 04. Belgium (A. vi) GOKHARAN.I banks should follow up submission of the Bill of Entry / documents evidencing import of rough diamonds into the country by the importer.. ii) RIO TINTO. UK. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. (DIR Series) Circular No. 2008 and A. UK iii) BHP Billiton. Russia. (iv) KYC and due diligence exercise should be done by the AD Category . P. Belgium and viii) BHP Billiton.than a Public Sector Company or a Department / Undertaking of the Government of India / State Government/s). for import of rough diamonds into India from the undernoted mining companies. 08 dated August 21. (iii) Advance payments should be made strictly as per the terms of the sale contract and should be made directly to the account of the company concerned. viz. P. in terms of the Act / Rules / Regulations / Directions issued in this regard.I banks may ensure the following: (i)The importer should be a recognised processor of rough diamonds as per a list to be approved by GJEPC in this regard and should have a good track record of export realisation. i) De Beers UK Limited.I banks should undertake the transaction based on their commercial judgment and after being satisfied about the bonafides of the transaction. (DIR Series) Circular No. Further. Hyderabad 19 . Angola. Australia iv) ENDIAMA. AD Category . to the ultimate beneficiary and not through numbered accounts or otherwise. due caution may be exercised to ensure that remittance is not permitted for import of conflict diamonds. P. 2008) While allowing the advance remittance. and (v) AD Category . that is.I banks for the Indian importer entity and the overseas company. (ii) AD Category .

I banks are required to submit a report of all such advance remittances made without a bank guarantee or standby letter of credit. 12. Government of India where the advance payments is equivalent to or exceeds USD 100. AD Category – I banks may allow advance remittance.I banks may permit advance remittance subject to the above conditions and a specific waiver of bank guarantee from the Ministry of Finance. for direct import of each aircraft.(USD Five million only). airline companies which have been permitted by the Directorate General of Civil Aviation to operate as a schedule air transport service. as at the end of September and March every year. Accordingly. where the amount of advance payment is equivalent to or exceeds USD 5.(USD one hundred thousand only).I banks should undertake the transactions based on their commercial judgment and after being satisfied about the bonafide of the transactions. Foreign Exchange Department. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. The AD Category . ii. Hyderabad 20 . irrevocable standby Letter of Credit.000/. Reserve Bank of India. up to USD 50 million. helicopter and other aviation related purchases.I banks for the Indian importer entity and the overseas manufacturer company as well. AD Category . in the format given in Annexure-8. Advance payments should be made strictly as per the terms of the sale contract and are made directly to the account of the manufacturer (supplier) concerned. to The Chief General Manager. The remittances for the above transactions shall be subject to the following conditions: i. with the approval of their Board of Directors. without obtaining a bank guarantee or an unconditional. AD Category .000. Mumbai. Central Office. The deadline for submission of the report would be 15 calendar days after the close of each half year.I bank may frame their own internal guidelines to deal with such cases. on a half yearly basis. iii. can make advance remittance without bank guarantee.000/. Advance Remittance for Import of aircrafts / helicopters / other aviation related purchases As a sector specific measure. AD Category . up to USD 50 million. Trade Division.In case of an importer entity in the Public Sector or a Department / Undertaking of the Government of India / State Government/s. KYC and due diligence exercise should be done by the AD Category .

Hyderabad 21 .I bank should ensure that the amount of advance remittance is immediately repatriated to India. In cases where the lease transaction contains option to purchase the asset at the end of the lease period. Prior to making the remittance. Government of India. Prior approval of the concerned Regional Office of the Reserve Bank will be required in case of any deviation from the above stipulations.000. It is clarified that where advance is paid as milestone payments. v. AD Category . Authorised dealers may allow remittance of payment of lease rentals. the AD Category . vii.000.000 (US Dollar one million only) per aircraft towards security deposit (for payment of lease rentals) with lessor for import of aircraft/ Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. the AD Category – I bank may ensure that the requisite approval of the Ministry of Civil Aviation / DGCA / other agencies in terms of the extant Foreign Trade Policy has been obtained by the company for import. Government of India for advance remittances exceeding USD100. it will require prior approval from the Reserve Bank of India.I bank shall ensure that the requirement of bank guarantee has been specifically waived by the Ministry of Finance. opening letter of credit towards security deposit etc. the date of last remittance made in terms of the contract will be reckoned for the purpose of submission of documentary evidence of import. In the case of a Public Sector Company or a Department / Undertaking of Central / State Governments. in respect of import of aircraft/aircraft engine/helicopter on operating lease basis. In the event of non-import of aircraft and aviation sector related products. after verifying that the airline company has obtained necessary approval from the appropriate authorities like Ministry of Civil Aviation/Director General of Civil Aviation. ADs may permit airline companies (other than a Public Sector company or a Department/Undertaking of the Government of India/State Government/s) to remit up to USD 1..iv. 13. b. Physical import of goods into India is made within six months (three years in case of capital goods) from the date of remittance and the importer gives an undertaking to furnish documentary evidence of import within fifteen days from the close of the relevant period. c. vi. Remittances for Import of Aircraft /Aircraft Engine/Helicopter on Lease basis a.

000 (US Dollar one hundred thousand only) per aircraft towards security deposit (for payment of lease rentals) with lessor subject to conditions (i) to (iv) in paragraph (c) above and a specific waiver of bank guarantee from the Ministry of Finance.00. Hyderabad 22 . and Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. ii) The airline company has obtained necessary approval from appropriate authority like Ministry of Civil Aviation/Director General of Civil Aviation.. In case of an airline company in the Public Sector or a Department/Undertaking of the Government of India/State Government/s. the deposit amount may be adjusted towards lease rentals. Government of India for importing the aircraft/helicopter on operating lease. licence fee. wherever required. profit etc. iii) Remittance is permitted as per the Policy on Advance Remittances approved by the Board of Directors of the bank or with the specific approval of the Board of Directors of the bank. iv) The final maturity of the security deposit should not be beyond the date of the last instalment towards lease rental or date of return of the aircraft / helicopter to the lessor. 14.I banks may allow remittance of rent. However. Government of India. Remittances for Import of films on lease / rental basis AD Category . ii) A Chartered Accountant’s certificate is produced indicating that the payment to overseas supplier is due and the amount sought to be remitted is in conformity with the terms of the contract. if any. royalty. the balance security deposit. has been submitted. If required. should be repatriated before expiry of the lease period. d. whichever is later. in connection with import of cinematograph feature films and video films subject to the following conditions: i) A ‘No Objection Certificate’ from Central Board of Film Certification. ADs may permit remittance of amount exceeding USD 1.aircraft engine / helicopter on operating lease without a standby letter of credit or a guarantee from a reputed international bank abroad or a guarantee of an AD in India against the counter-guarantee of a reputed international bank abroad subject to following conditions: i) The AD is satisfied about the bona fides of the transaction.

proforma invoices etc. Hyderabad 23 . Advance Remittances for Import of Services With a view to liberalizing the procedure further.000 or its equivalent. ii) Documentary evidence. Anti Money Laundering (AML) guidelines shall be strictly adhered to. Where the amount of advance exceeds USD 500.000 or its equivalent. failing which. i) The advance remittance will be effected on behalf of our customers only and all KYC. AD Category – I banks should also follow-up to ensure that the beneficiary of the advance remittance fulfils his obligation under the contract or agreement with the remitter in India. the amount should be repatriated to India. The ECCB approved Bank’s policy guidelines for all admissible Current Account transactions for Import of Services. such as agreement. AD Category – I banks may frame their own guidelines to deal with such cases as per the policy approved by the bank’s Board of Directors. iv) Satisfactory Opinion Report on the overseas supplier / accredited agent shall be obtained beforehand. it has been decided by RBI to raise the limit of USD 100.000 or its equivalent are given below. from an independent agency or from our Representative / Foreign Offices / Correspondents abroad.iii) An undertaking / certificate regarding payment of income-tax has been submitted. or a guarantee from an AD Category – I bank in India. a guarantee from a bank of international repute situated outside India. 15.000 and upto USD 500. indicating the cost of the services to be provided /imported and specific demand of the overseas service provider shall be obtained and kept as branch record. without insisting on Bank Guarantee for amounts above USD 100. should be obtained from the overseas beneficiary. iii) The overseas service provider shall also furnish an undertaking that the amount shall be repatriated immediately in case the obligations under the contract / agreement are not fulfilled /met.000 for advance remittance for all admissible current account transactions for import of services without bank guarantee to USD 500. if such a guarantee is issued against the counterguarantee of a bank of international repute situated outside India. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.

Hyderabad 24 . the imports do not fructify as per the agreed terms and conditions / time lines. viii) So far as the borrower customers are concerned. but later allowed to be cleared by the Customs Authorities against payment of penalty. after a reasonable time. branches shall ensure to obtain an undertaking and or a certificate from the Chartered Accountant of the importer / remitter. all efforts should be made to repatriate the funds in terms of the undertaking furnished by the overseas beneficiary. value of the goods indicated on the relative Exchange Control copy of Bill of Entry evidencing import of goods in to India. wherever applicable. ix) The branches shall follow up to satisfy themselves about the import of services. have been deducted / paid. indicating that the services have been procured / imported and taxes. as per the terms / format contained in Section X. x) Remittances exceeding USD 500.F. through banking channel.I banks may make remittances against goods imported without authority. the branch shall report the matter to the Regional Office concerned of RBI after a reasonable time. the remittance shall be made subject to availability of funds in their accounts and Bank is satisfied about the bonafide of the importer and the purpose of the remittance. to the extent of C. vii) For non-borrower customers. 16. Chapter 22 of the FD Codified Circular. 17. vi) Since such imports are in non-physical form. as per extant instructions of RBI. In the event of the repatriation not being made despite all efforts.I banks may make remittances towards War Risk insurance premium. If however.v) Remittances shall be made by the Bank direct to the overseas suppliers. Remittances for Imports under Penalty AD Category . viz 3 months after the agreed / extended date for such import.I. the facility is to be extended to such borrowers with a satisfactory track record. Bunker / Congestion surcharge at foreign ports.. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.000 or its equivalent shall be effected only against a guarantee from a bank of international repute situated outside India or the guarantee issued by an AD Category-I bank in India against the counter-guarantee of a bank of international repute situated outside India. and premia for extended insurance cover etc. Remittances for War Risk Insurance / Bunker / Congestion Surcharge / Premium for Extended Insurance AD Category . which are incidental to imports.

short-landed or lost in transit and the Exchange Control copy of the import licence has already been utilised to cover the opening of a letter of credit against the original goods which have been lost. may be obtained. according to their commercial judgment. to ensure that the importer submits :a. AD Category . a certificate from a Chartered Accountant that the software/data/ drawing/ design has been received by the importer. Hyderabad 25 .I banks may issue guarantees at the request of importer client for despatch/return of the defective goods.000 or its equivalent. 19. The Exchange Control copy of the Bill of Entry for warehousing. damaged.18. Customs Assessment Certificate or Postal Appraisal Form. as declared by the importer to the Customs Authorities. it is obligatory on the part of the AD Category . It may be ensured that the consignment being replaced is shipped within the validity period of the licence.. in case of 100% Export Oriented Units or c. the original endorsement to the extent of the value of the lost goods may be cancelled by AD Category . 20.I banks and fresh remittance for replacement imports permitted without reference to Reserve Bank. or b. Evidence of Import i. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. software or data through internet/datacom channels and drawings and designs through e-mail/fax. Guarantees for Replacement Import In case replacement goods for defective import are being sent by the overseas supplier before the defective goods imported earlier are reshipped out of India. as evidence that the goods for which the payment was made have actually been imported into India.I banks through whom the relative remittance was made. where import has been made by post. The Exchange Control copy of the Bill of Entry for home consumption. i. where value of foreign exchange remitted/paid for import into India exceeds USD 100.e. ii. Remittances against Replacement Imports Where goods are short-supplied. General : In case of all imports. provided the insurance claim relating to the lost goods has been settled in favour of the importer. Imports in non-physical form: Where imports are made in non-physical form.

in respect of cases which are under investigation by investigating agencies.. iv. etc.g. d) Number and date of Exchange Control copy of Bill of Entry/Postal Appraisal Form or Customs Assessment certificate and the amount of import. Issuing acknowledgement: AD Category . delay in delivery/customs clearance of consignment. not exceeding three months from the date of remittance. iii. the documents may be destroyed only after obtaining clearance from the investigating agency concerned. c) Bank’s reference of letter of credit number. Hyderabad 26 .I banks should insist on production of evidence of import at the time of effecting remittance of import bill. etc.Note: AD Category ..g. Preservation of evidence of import: Documents evidencing import into India should be preserved by AD Category .I banks for a period of one year from the date of its verification. vi. AD Category . if satisfied with the genuiness of request. Exchange Control copies of Bills of Entry or Postal Appraisal Forms or Customs Assessment Certificates. from importers by issuing acknowledgement slips containing all relevant particulars such as. Verification by auditors: Internal inspectors or auditors (including external auditors appointed by dealers) should carry out verification of the documents evidencing import.I banks should acknowledge receipt of evidence of import e. Imports on D/A basis: In respect of imports on D/A basis. Exchange Control copy of the Bill of Entry.. b) Import licence number and date (wherever applicable). to the importer to submit the evidence of import. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. AD Category . v. However. allow reasonable time. However. a) Importer’s full name and address with code number. etc.I banks may. Postal Appraisal Form or Customs Assessment Certificate. if importers fail to produce documentary evidence due to genuine reasons such as non-arrival of consignment. and e) Particulars of goods imported..I banks should advise importers to keep Customs Authorities informed of the imports made by them under this clause. if any. etc. e.

within 3 months from the date of remittance involving foreign exchange exceeding USD100.vii. Hyderabad 27 .I banks should rigorously follow-up for the next 3 months. b.000 (USD one million) or its equivalent.000. the AD Category .I. The above facility may also be extended to autonomous bodies. Certificate from CEO/Auditor of the company as evidence of import: AD Category . whose accounts are audited by the Comptroller and Auditor General of India (CAG). the importer is a public sector company or an undertaking of the Government of India or its departments.I banks may accept either Exchange Control copy of Bill of Entry for home consumption or a certificate from the Chief Executive Officer (CEO) or auditor of the company that the goods for which remittance was made have actually been imported into India provided :a. The said half-yearly statement should be submitted to the Regional Office of R.I banks is Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. AD Category . in form BEF (format as per annexure 1) furnishing details of import transactions.000. 21. In case an importer does not furnish any documentary evidence of import.I banks may insist on a declaration from the auditor/CEO of such institutions that their accounts are audited by CAG. including issue of registered letters to the importer. as required under paragraph 17 above. including scientific bodies/academic institutions. Follow up for Import Evidence i. the amount of foreign exchange remitted is less than USD 1. c. under whose jurisdiction the AD Category . ii. exceeding USD 100.I banks should forward to Reserve Bank a statement on halfyearly basis as at the end of June & December of every year. such as Indian Institute of Science / Indian Institute of Technology etc. the importer is a company listed on a stock exchange in India or and whose net worth is not less than Rs.100 crores as on the date of its last audited balance sheet.B.000 in respect of which importers have defaulted in submission of appropriate document evidencing import within 6 months from the date of remittance. AD Category .

functioning. for customers under this category. for such category of customers. Customers not having any borrowing arrangements with us. ii). Therefore. purpose of import etc. follow-up for submission of evidence of import need not be done in case of borrowers having Credit Rating up to SB-5. on account of regular transactional relationship with the borrower. our internal policy guidelines (as per FD Circular No. customers who have received Bills direct from the overseas exporters).e. 105/2005-06 dated 23. a suitable self declaration.12. the following procedure is proposed:Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. may be obtained. customers of other Banks. In case of customers having credit relationship with us. Follow up for Import Evidence – Bank’s instructions a) Where Imports are on DP (Delivery against payment) basis: i). furnishing particulars like details of Bill of Entry. This will adequately address the issue of establishing the genuineness of the transaction. Therefore. such waiver may be permitted on case to case basis by the sanctioning authority. the bonafides of the customer and genuineness of the transactions is also established.2005) on the followup of evidence of import of goods of value upto USD 100. Moreover. there is no credit relationship which will enable the Bank to establish genuineness of transaction on an ongoing basis. iii). In such cases since KYC guidelines will not be complied with.000 or less provided they are satisfied about the genuineness of the transaction and the bonafides of the remitter. In such cases while the KYC requirements are fulfilled. A suitable policy may be framed by the bank's Board of Directors and the AD Category-I banks may set their own internal guidelines to deal with such cases. AD Category-I banks need not follow up submission of evidence of import involving amount of USD 100. In case of borrowers having Credit Rating below SB-5. Customers having borrowing arrangements with us. observance of KYC guidelines is ensured. within 15 days from the close of the half-year to which the statement relates. Hyderabad 28 .000 have been framed and approved by the Central Board as given in para 21 below : 22. Accordingly. Imports made by non-customers (i.

e. Branches should obtain declarations giving details of the import. the equipments are installed at overseas sites without physical import taking place in India. the importers are unable to produce evidence of import. like particulars of Bill of Entry. However. ii) Imports made on non-physical form i. ii) Where the value of import falls between USD 25000 and USD 100. Import of Equipments by BPO Companies in India for International Call Centre Business Process Outsourcing (BPO) companies in India make remittances towards import and installation of equipments at overseas sites in connection with setting up of their International Call Centres. self declaration from the importer. requiring specific permission from the Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. The cut-off limit for self-declaration has been proposed keeping in view the liberalization measures where remittances for all eligible purposes for an amount upto USD 25000 or equivalent has been permitted. as laid down in Section VI. not exceeding three months from the date of remittance. as under: i) If the value of import is upto USD 25000. purpose of import etc. In such cases. in software or data through internet and drawings and designs through email/ fax : A certificate from a Chartered Accountant that the software / data / drawing / design have been received by the importer shall be obtained. will be allowed to the importer to submit the evidence of import. reasonable time.000 or its equivalent. which briefly are as under. Para 8 of Codified FD Circulars updated as on the 30th June. 2005. Certificate from the Chartered Accountant of the importer. shall continue: i) Imports made on DA (Delivery Against Acceptance) Production of evidence of import at the time of effecting remittance of import bill will be insisted upon. b) Imports made on DA basis or Imports in Non-Physical form: The existing / prescribed procedure of follow-up. if the importer fails to produce documentary evidence due to genuine reasons. 23. Hyderabad 29 . As a result.a) The rupee equivalent of the remittance should be invariably received through normal banking channels like Crossed Cheques/Drafts/Pay Orders etc. b) In order to ascertain the genuineness of the transaction.

I banks should. make remittances where import bills have been received directly by the importers from the overseas supplier. 25. where the import bills / documents have been received directly by the importer from the overseas Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. c. it has been liberalised that AD category I banks may. financial standing. Handling of Import Documents on collection basis Due care should be exercised while handling import documents on collection basis on behalf of importer customers with reference to their line of business. subject to the following conditions: a.I banks should not.Reserve Bank. Direct Receipt of import Bills/Documents Import bills and documents should be received from the banker of the supplier by the banker of the importer in India. AD Category . In case of importers who are not their constituents. Hence. In case of bills involving large values. allow BPO companies in India to make remittances towards the cost of equipment to be imported and installed at their overseas sites in connection with the setting up of their International Call Centres. The remittance is made directly to the account of the overseas supplier.I banks should satisfy themselves that the importer is known to be trading in items mentioned in the shipping documents or that the items are required for his actual use. The remittance should be allowed based on the AD Category – I banks’ commercial judgment. except in the following cases: i) AD Category – I banks may make remittances for imports. at the time of acceptance of the documents/making payment. d. The AD Category – I banks should also obtain a certificate as evidence of import from the Chief Executive Officer (CEO) or auditor of the importer company that the goods for which remittance was made have actually been imported and installed at overseas sites. Hyderabad 30 . therefore. The BPO company should have obtained necessary approval from the Ministry of Communications and Information Technology. call for detailed Certificate-cum-Report from their bankers in support of the genuineness of the imports. Government of India and other authorities concerned for setting up of the International Call Centre. the bonafides of the transactions and strictly in terms of the contract. AD Category . to establish the genuineness of the import. frequency of import etc.. b. 24. AD Category .

where the invoice value exceeds USD 300. public limited.000. c.I bank is fully satisfied about bonafides of the transaction and the financial standing/status and track record of the importer customer. provided the AD Category . Import bills received by Status holder exporters as defined under the Foreign Trade Policy. AD Category . At the request of importer clients. v).supplier and the value of import bill does not exceed USD 300. iii). Hyderabad 31 . (A. AD Category . 13 dated September 1. Import bills received by wholly-owned Indian subsidiaries of foreign companies from their principals.I banks should do the due diligence exercise and should be fully satisfied about the financial standing / status and track record of the importer customer. d. subject to the following conditions : a. deemed public limited and private limited companies. . e. P. Import bills received by all limited companies viz. Public Sector Undertakings and Limited Companies. it should be reported through the Suspicious Transaction Report (STR) to FIU_IND (Financial Intelligence Unit in India).I bank should obtain a credit report on each individual overseas supplier from the overseas banker or reputed credit agency. It is customary in that trade to receive import documents directly from the overseas exporter. Before extending the facility. The transactions are based on their commercial judgment and they are satisfied about the bonafides of the transactions. (DIR Series) Circular No. 100% Export Oriented Units / Units in Free Trade Zones. iv).000. Credit report on the overseas supplier (where the import documents are received directly) need not be obtained in cases where the invoice value does not Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.I banks may receive bills direct from the overseas supplier as above. b. f. The import would be subject to the prevailing Foreign Trade Policy. 2008) ii). The importer is a customer of AD Category – I bank and the customer's account is fully compliant with extant KYC / AML guidelines issued by the Reserve Bank. AD Category . In case the AD Category – I bank has suspicions about the genuineness of the transaction.

(iii) AD Category . they should also obtain a report on each individual overseas supplier from the overseas banker or reputed credit agency overseas.I bank is satisfied about the bonafides of the transaction and track record of the importer constituent.I banks are permitted to allow remittance for imports up to USD 300.exceed USD 300. AD Category . the relative parcel receipts must be produced as evidence of despatch through the post and an undertaking to submit Postal Appraisal Form or Customs Assessment Certificate as evidence of import within three months from the date of remittance should be furnished by importers.I banks should do the KYC and due diligence exercise and should be fully satisfied about the financial standing / status and track record of the importer customer. Hyderabad 32 . therefore.000 adds to transaction costs for small importers and have requested the Reserve Bank to consider relaxing this condition for import of rough diamonds by non-status holders. provided that the AD Category . 27.000. Before extending the facility. (ii) The transactions are based on their commercial judgment and they are satisfied about the bonafides of the transactions. to enhance the limit for direct receipt of import bills / documents from USD 100. been decided by RBI. AD Category . 26. It has.import of rough diamonds: The Gems and Jewellery Export Promotion Council (GJEPC) has represented that the restrictions placed on non-status holder exporters for direct receipt of import bills / documents.000 in the case of import of rough diamonds. Postal Imports Remittances against bills received for collection in respect of imports by post parcel made by AD Category . the Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.I banks. Where the remittance is sent subsequent to receipt of the parcel. where the value exceeds USD 100. as a sector specific measure. Direct receipt of import bills / documents .000 to USD 300.000 where the importer of rough diamonds has received the import bills / documents directly from the overseas supplier and the documentary evidence for import is submitted by the importer at the time of remittance.I banks may undertake such transactions subject to the following conditions : (i) The import would be subject to the prevailing Foreign Trade Policy. Accordingly. In these cases. provided the goods imported are such as are normally despatched by post parcel.

Hyderabad These nominated agencies/banks are permitted to to import gold under different arrangements.. Where goods to be imported are not of a kind normally imported by post parcel or where AD Category . Import of Platinum / Palladium / Rhodium / Silver Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. 28. SBI and other agencies authorised by R. for prior approval with full particulars together with relative parcel receipts/and Postal Appraisal Form or Customs Assessment Certificate. Government of India has permitted import of gold by certain nominated agencies viz. ii. as and when the importer sells the gold to the users. Import of gold on consignment basis Gold may be imported by the nominated agencies/banks on consignment basis where the ownership will remain with the supplier and the importer (consignee) will be acting as an agent of the supplier (consignor). Import of gold on unfixed price basis The nominated agency/bank may import gold on outright purchase basis subject to the condition that although ownership of the gold shall be passed on to the importer at the time of import itself. iii. Note: AD Category . Import of Gold/Platinum/Silver by Nominated Banks/Agencies Under the liberalised policy for import. holders of special import licences and domestic users. STC.I.I.I. HHEC. NRIs. the case may be referred to R. exporters.I banks may make remittances towards import of books by post parcel by book sellers / publishers against bills received for collection. without prior approval of R. the price of gold shall be fixed later. They may also make remittances even if import licences covering the imports have been issued subsequent to the date of import subject to endorsement on such import licences. besides outright purchase on D/P basis as follows: i. 33 . MMTC. for sale to jewellery manufacturers.B. Remittances towards the cost of import shall be made as and when sales take place and in terms of the provisions of agreement entered into between the overseas supplier and nominated agency/bank.B.B.Postal Appraisal Form or Customs Assessment Certificate should be produced by the importer.I bank is not satisfied about the bonafides of the application. irrespective of the amounts involved.

Rhodium and Silver should not exceed 90 days from the date of shipment. Palladium. Direct Import of Gold AD Category . Banker's prudence should be strictly exercised for all transactions pertaining to import of gold.I.The present instructions have been reviewed in the context of recent developments and it has been decided by RBI that Suppliers’ and Buyers’ credit. Further. any large or abnormal increase in the volume of business should be closely examined to ensure that the transactions are bonafide and are not intended for interest / currency arbitrage.I banks should ensure that due diligence is undertaken and all Know-Your-Customer (KYC) norms and the Anti-MoneyLaundering guidelines. iii. 29. (DIR Series) Circular No. Hyderabad 34 . subject to the following-i. 12 dated August 28. All other instructions relating to import of these metals shall continue. issued by R. AD Category – I banks should ensure that due diligence is undertaken and Know-Your-Customer (KYC) norms and Anti-Money Laundering (AML) guidelines. including the usance period of LCs opened for direct import of gold.I banks can open Letters of Credit and allow remittances on behalf of EOUs. units in SEZs in the Gem & Jewellery sector and nominated agencies. 2008) NOTE: Instructions contained in this paragraph would also apply to import of platinum and silver.B. issued by the Reserve Bank are adhered to while undertaking import of these metals. Any large or abnormal increase in the volume of business of the importer should be closely examined to ensure that the transactions are bonafide trade transactions. Suppliers’ and Buyers’ Credit. P. are adhered to while undertaking such transactions. should not exceed 90 days. (A. including the usance period of Letters of Credit opened for import of Platinum. ii. for direct import of gold. The import of gold should be strictly in accordance with the Foreign Trade Policy. AD Category . Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.

in case of such transactions banks should also make discreet enquiries from other banks to assess the actual position. 2004. nominated agencies and 100% EOUs/units in SEZ. Foreign Exchange Department. (ii). (iii). The credentials of the supplier should also be ascertained before opening of LCs. Further.I banks should closely monitor such transactions in addition to carrying out the normal due diligence exercise. or as notified by the Government of India from time to time in this regard. Road. which are in the Gem and Jewellery sector.M. v. Central Office. Amar Building. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.I banks may open Standby Letters of Credit (SBLC). where ever required. line of business and the net worth of the importer customer should be commensurate with the volume of business turnover. 30. viz. 2003. Sir P. AD Category . The tenor of the SBLC should be in line with the tenor of the gold loan. to the Trade Division. Head Offices/International Banking Divisions. Hyderabad 35 . The financial standing. Fort. Mumbai 400001. It may be noted that the SBLC can be opened only on behalf of entities permitted to import gold on loan basis. as per the Foreign Trade Policy and Public Notice No. The same is 240 days at present. Apart from the above. all documents pertaining to such transactions must be preserved for at least five years. The maximum tenor of gold loan would be as per the Foreign Trade Policy in force. in order to establish audit trail of import/export transactions. AD Category . for import of gold on loan basis. vi.28/ 2004-09 dated December 1.I banks undertaking gold import transactions are required to submit as per the format (Annexure 2) a monthly statement thereof.I banks should follow up submission of the evidence of import by the importers as mentioned in Para 18 above. Import of Gold on Loan basis (i).iv. Reserve Bank of India. of AD Category . On the other hand EOUs and units in SEZ who are in the Gem and Jewellery sector can import gold on loan basis for manufacturing and export of jewellery on their own account only. as per FEDAI guidelines dated April 1. AD Category . Nominated agencies / approved banks can import gold on loan basis for on lending to exporters of jewellery under this scheme.

the SBLC should be in favour of internationally renowned bullion banks only. regulations and directions applicable to import (except Bill of Entry) are complied with in respect of the import leg of merchanting trade transactions. Import of Gold.B. will continue to be applicable. and c. However. 32. AD Category . all rules.Further.I. 33. with usance period not exceeding 90 days. 31. Import factoring AD Category .I banks will have to ensure compliance with the extant exchange control directions relating to imports. concerned NRI seller.I banks may take necessary precautions in handling merchanting trade transactions or intermediary trade transactions to ensure that: a. b.I banks may enter into arrangements with international factoring companies of repute. without prior approval of R. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Silver and Jewellery by NRIs Gold bought by an NRI in accordance with the Foreign Trade Policy in force. Foreign Trade Policy in force and any other guidelines/directives issued by R.B.I banks can obtain a detailed list of internationally renowned bullion banks from the Gem & Jewellery Export Promotion Council. Hyderabad The amounts so received should only be credited to Non-Resident Ordinary accounts of the 36 . (iv). regulations and directions applicable to export out of India (except Export Declaration Form) are complied with in respect of the export leg and all rules. All other existing instructions on import of gold and opening of Letters of Credit. AD Category . AD Category . preferably members of Factors Chain International.I. in this regard. Merchanting Trade AD Category .I banks must maintain adequate documentation with them to uniquely link all imports with the Standby Letters of Credits issued for the import of gold on loan basis. is permitted to be sold to residents against payment in rupees. goods involved in the transactions are permitted to be imported into India. such transactions do not involve foreign exchange outlay for a period exceeding three months.

and d. provided: a. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. AD Category . the entire merchant trade transaction is completed within a period of 6 months. Foreign Exchange Department. and ii. c. the guarantee is to secure a direct contractual liability arising out of a contract between a resident and a non-resident. In case of invocation of the guarantee. While undertaking bonafide merchanting trade transactions on behalf of their trader clients. Reserve Bank of India. the guarantee amount does not exceed USD 100. Issue of Bank Guarantee on behalf of service importers AD Category-I banks are now permitted to issue guarantee on behalf of their customers importing services. Central Office.I banks should ensure that the terms of payment for the import leg and the export leg of the transactions are such that: i. Hyderabad 37 . the AD Category-I bank is required to submit to the Chief General Manager-in-Charge.I banks may note that short-term credit either by way of suppliers' credit or buyers' credit is not available for merchanting trade or intermediary trade transactions. 34. without any delay. AD Category . the AD Category-I bank ensures submission of documentary evidence for import of services in the normal course. the liability for the import leg of the transaction is extinguished by the payment received for the export leg of the transaction. b.I banks are also required to ensure timely receipt of payment for the export leg of such transactions. Foreign Investments Division (EPD). the AD Category-I bank is satisfied about the bonafides of the transaction.000.AD Category . Mumbai-400001 a report on the circumstances leading to the invocation of the guarantee.

Hyderabad 38 . The AD Category . If for any particular reason. Any reference to Reserve Bank should be made to the regional office of the Foreign Exchange Department situated in the jurisdiction where the applicant person. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Exemptions from Declarations (i) The requirement of declaration of export of goods and software in the prescribed form will not apply to the cases indicated below. a) Trade samples of goods and publicity material supplied free of payment. as amended from time to time. trans-shipment cargo and goods supplied under the orders of Central Government or of such officers as may be appointed by the Central Government in this behalf or of the military.Dollar twenty five thousand) in value or its equivalent. These Regulations have been notified vide Notification No. firm or company resides or functions. be liable to realise and repatriate export proceeds as per FEMA Regulations. FEMA 23/2000-RB dated May 3.I banks should not report all exports of value upto USD 25000 or its equivalent in the XOS half yearly statements falling due on 31st December 2004 and thereafter. whether accompanied or unaccompanied. 2000 relating to export of goods and services from India.S. c) Ship’s stores. Trade and Foreign Exchange Regulations In exercise of the powers conferred by clause (a) of sub-section (1). it may approach the regional office of its jurisdiction for necessary approval. the Reserve Bank has made the Foreign Exchange Management (Export of Goods and Services) Regulations. naval or air force requirements. hereinafter referred to as the ‘Export Regulations’. The exporters shall however. 2. 1999 (42 of 1999). unless otherwise indicated. naval or air force authorities in India for military. sub-section (3) of section 7 and sub-section (2) of section 47 of the Foreign Exchange Management Act. d) Goods or software accompanied by a declaration by the exporter that they are not more than USD 25000 (U. 2000. General i. a firm or company desires to deal with a different office of the Foreign Exchange Department.PART II . b) Personal effects of travellers.EXPORT OF GOODS AND SERVICES 1.

Electronic Hardware Technology Parks. j) Replacement goods exported free of charge in accordance with the provisions of Exim Policy in force. Goods listed at items (i). iii) Goods imported from foreign suppliers/collaborators free of cost. h) Goods not exceeding U.S. i) The following goods which are permitted by the Development Commissioner of the Export Processing Zones. for the time being. Electronic Software Technology Parks or Free Trade Zones to be re-exported.$ 1000 or its equivalent in value per transaction exported to Myanmar under the Barter Trade Agreement between the Central Government and the Government of Myanmar. ii) Goods imported from foreign suppliers/collaborators on loan basis. namely: i) Imported goods found defective. l) Defective goods sent outside India for repair and re-import provided the goods are accompanied by a certificate from an Authorised Dealer in India that the export is for repair and re-import and that the export does not involve any transaction in foreign exchange. found surplus after production operations.e) By way of gift of goods accompanied by a declaration by the exporter that they are not more than five lakhs rupees in value. f) Aircrafts or aircraft engines and spare parts for overhauling and/or repairs abroad subject to their re-import into India after overhauling /repairs. g) Goods imported free of cost on re-export basis. within a period of six months from the date of their export. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. for the purpose of their replacement by the foreign suppliers/collaborators. (ii) and (iii) of clause ( i ) to be re-exported by units in Special Economic Zones. k) Goods sent outside India for testing subject to re-import into India. under intimation to the Development Commissioner of Special Economic Zones/concerned Assistant Commissioner or Deputy Commissioner of Customs. Hyderabad 39 .

for export promotion up to 2 percent of the average annual exports of the applicant during the preceding three years subject to a ceiling of Rs. and subsequently re-imported after necessary repairs / maintenance / calibration / testing. testing etc. Hyderabad 40 .I banks may obtain a certificate issued by the testing agency that the goods have been destroyed during testing. consider grant of GR approval.5 lakhs. GR Approval for export With a view to further liberalise the facilities available to exporters and simplify the procedure for export. It is clarified that in cases where the goods being exported for testing are destroyed during testing. whichever is higher. etc. For status holder exporters.I banks for grant of GR approval in cases where goods are being exported for re-import after repairs / maintenance / testing / calibration. subject to the condition that the exporter shall produce relative Bill of Entry within one month of re-import of the exported item from India. Accordingly.(ii) Exports permitted by the Reserve Bank. (v) Export of goods not involving any foreign exchange transaction directly or indirectly requires the waiver of GR/PP procedure from the Reserve Bank. (iv) AD Category . if any.I banks may. maintenance. AD Category . AD Category . as the case may be 3. calibration. in lieu of Bill of Entry for import. 1992 (22 of 1992) shall be indicated on all copies of the declaration forms submitted by the exporter to the specified authority and in all correspondence of the exporter with the AD Category . Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.10 lakhs or 2 percent of the average annual export realisation during the preceding three licensing years (Apr-March). RBI has delegated powers to AD Category .I banks may consider requests for grant of GR waiver from exporters for export of goods free of cost. as stipulated in the permission. the limit as per the present Foreign Trade Policy is Rs.I bank or the Reserve Bank. on application made to it. (vi) The importer-exporter code number allotted by the Director General of Foreign Trade under Section 7 of the Foreign Trade (Development & Regulation) Act. subject to the terms and conditions. in cases where goods are being exported for repairs. (iii) Gift of goods exceeding Rupees Five lakhs in value requires approval of the Reserve Bank. etc.

I banks only on receipt of funds in their Nostro account or if the AD Category .I banks may also receive payment for exports made out of India by debit to the credit card of an importer where the reimbursement from the card issuing bank/organisation will be received in foreign exchange.I bank in the manner specified in the Foreign Exchange Management (Manner of Receipt & Payment) Regulations. Numbering of Forms GR. FEMA 14/2000-RB dated May 3. Hyderabad 41 . In all applications/ correspondence with the Reserve Bank. In the case of declarations made on SDF form. AD Category . b.I bank concerned is not the Credit Card servicing bank. 2000. banker’s or personal cheques. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Bank draft. is deemed to be realisation of full export value of such goods. 5. in respect of goods sold to overseas buyers during their visits is received in this manner the GR/SDF (duplicate) should be released by the AD Category . the port code number and shipping bill number should be cited. pay order. (ii) Payment for export may also be received by the exporter in the following manner: a. When payment.4. c. Payment out of funds held in the FCNR/NRE account maintained by the Buyer d. within the period specified for realisation of the export value. on production of a certificate by the exporter from the Credit Card servicing bank in India to the effect that it has received the equivalent amount in foreign exchange. PP and SOFTEX forms will bear specific identification numbers. Foreign currency notes/foreign currency travellers’ cheques from the buyer during his visit to India. International Credit Cards. this identification number should invariably be cited. Re-import into India. Manner of Payment (i) The amount representing the full export value of the goods exported shall be received through an AD Category . 2000 notified vide Notification No.

Foreign Currency Accounts i) Opening of Foreign Currency Accounts (a) Reserve Bank may consider applications in Form EFC from exporters having good track record for opening foreign currency accounts with banks subject to certain terms and conditions. hold and maintain in the name of its office/branch set up outside India. Gold / Silver / Platinum by the Gem & Jewellery units in SEZs and EOUs in equivalent to value of jewellery exported on the condition that the sale contract provides for the same and the approximate value of the precious metals is indicated in the relevant GR / SDF / PP Forms.I banks should obtain prior approval of the Reserve Bank for issuing guarantees for caution-listed exporters. Payments in foreign currency to units in SEZ AD Category . 6. The AD Category Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.I banks may permit units in Domestic Tariff Areas (DTA) to purchase foreign exchange for making payment for goods supplied to them by units in Special Economic Zones (SEZ). such payments shall be routed through the ACU mechanism. Precious metals i. Applications for opening such an account with a branch of an AD Category . (b) An Indian entity has also been permitted to open. 7. where the importer has been permitted by the Nepal Rashtra Bank to make payment in free foreign exchange. If the foreign currency account is to be maintained abroad the application should be made by the exporter giving details of the bank with which the account will be maintained. in case of export of goods to Nepal.e. Hyderabad 42 . Guarantees against Exports AD Category . a foreign currency account with a bank outside by making remittance for the purpose of normal business operations of the said office/branch or representative subject to conditions stipulated in Notification No. However. All transactions between a person resident in India and a person resident in Nepal may be settled in Indian Rupees.e. f. 8.I bank in India may be submitted through the branch at which the foreign currency account is to be maintained. FEMA 47/2001-RB dated December 5. 2001.

iv) The details of bank accounts opened in the overseas country should be promptly reported to the Authorised Dealer. ii) Diamond Dollar Account Under the scheme of Government of India. hold and maintain Foreign Currency Account with a bank outside or in India. Any funds rendered surplus should be repatriated to India. with track record of at least three years in import or export of diamonds / coloured gemstones / diamond and coloured gemstones studded jewellery / plain gold 43 Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.I bank in India subject to certain specified conditions. hold and maintain a Foreign Currency Account with an AD Category . . (d) A person resident in India being a project /service exporter may open.I banks may therefore allow remittances for the purpose of normal business operations of the office (trading/non-trading)/ branch or representative outside India as per the provisions of the Regulations in this regard subject to the following terms and conditions: i) The overseas office (trading/non-trading)/branch / representative should not create any financial liabilities contingent or otherwise for the head office in India. iii) The overseas office/branch of software exporter company/firm may repatriate to India 100% of the contract value of each ‘off-site’ contract as also at least 30% of the contract value of each ‘on-site’ contract and may utilize the balance amount (70%) of the contract value of ‘on-site’ contracts for contract related expenses including office/branch expenses abroad. (c) A unit located in a Special Economic Zone (SEZ) may be allowed to open. minakari and / or studded with / without diamond and / or other stones. expenses and repatriation thereon may be sent to the AD Category . A duly audited yearly statement showing receipts under ‘off-site’ and ‘on-site’ contracts undertaken by the overseas office. Hyderabad . subject to the standard terms and conditions in the Memorandum PEM. ii) The overseas office (trading/non-trading)/ branch representative should not invest surplus funds abroad without prior approval of Reserve Bank of India.I bank. firms and companies dealing in purchase/sale of rough or cut and polished diamonds / precious metal jewellery plain.

5 crores or above during the preceding three licensing years (licensing year is from April to March) are permitted to transact their business through Diamond Dollar Accounts and may be allowed to open not more than five Diamond Dollar Accounts with their banks. excluding EEFC accounts. coloured gemstones and plain gold jewellery from local sources. e. Permissible Debits • Payment for import / purchase of rough diamonds from overseas / local sources. f. • Realisation in US Dollars from local sale of rough. The transactions in the DDA would be as under: Permissible Credits • Amount of pre-shipment and post-shipment finance availed in US Dollars . polished diamonds and diamond studded jewellery. subject to the following terms and conditions: a. With a view to liberalising the procedure. • Realisation of export proceeds from shipments of rough. cut and polished diamonds. g. cut. with banks in India or abroad. The account shall only be in the form of current account and no interest should be paid on the balance held in the account. h. • Payment for purchase of cut and polished diamonds. Hyderabad 44 . Exporter firms and companies maintaining foreign currency accounts. No intra-account transfer should be allowed between the DDAs maintained by the account holder. and having an average annual turnover of Rs. The exporter should comply with the eligibility criteria stipulated in the Foreign Trade Policy of the Government of India. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. issued from time to time. c. • Payment for import/purchase of gold from overseas / nominated agencies and repayment of USD loans availed from the bank. The balances held in the accounts shall be subject to Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) requirements. • Transfer to rupee account of the exporter.jewellery. An exporter firm / company shall be permitted to open and maintain not more than 5 DDAs. it has been decided by RBI to delegate powers to AD Category – I banks to permit such firms and companies to open and maintain DDA with AD Category – I banks. d. are not eligible to open Diamond Dollar accounts. The DDA shall be opened in the name of the exporter and maintained in US Dollars only. b.

by the AD Category . The exporter firm / company shall make an application in the format annexed to the AD Category – I bank for opening of the DDA. a foreign currency account to be known as the Exchange Earners’ Foreign Currency (EEFC) Account.I bank in India. all EEFC accounts shall only be permitted to be opened and maintained in the form of non-interest bearing current accounts.I banks. P. at a rate of interest determined by the banks themselves. Viz. the account may be closed immediately. (DIR Series) Circular No. With effect from November 01. EEFC accounts were hitherto permitted to be maintained in the form of non-interest bearing current accounts. c) 100% Export Oriented Unit/s.I banks should assess the track record of the firm / company at the end of every licensing year (April-March). (A. 2009) iii) Exchange Earners’ Foreign Currency (EEFC) Account A person resident in India may open. AD Category . and Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.P. .The above transactions are subject to the provisions of the Foreign Trade Policy of Government of India. 04 dated August 4. Hyderabad 45 . e) Software Technology Parks (STPs). hold and maintain with an AD Category . d) Unit/s in Export Processing Zones (EPZs). a) Status Holder Exporter (as defined in Foreign Trade Policy in force). (A. maturing on or before 31st October 2008. it was possible for account holders to maintain outstanding balances to the extent of US $ 1 million in the form of term deposits up to one year. b) A resident in India for professional services rendered in his personal capacity. (DIR Series) Circular No.. 2008. 2008) No credit facilities either fund-based or non-fund based. 51 dated February 13. In case any firm / company fails to meet the eligibility criteria. should be permitted against the security of balances held in EEFC accounts. P. 2007. As per A. 2008. The limits of eligible credits to the EEFC accounts are 100 per cent all categories of exporters. issued from time to time. The measure of interest payment on EEFC accounts has since been reviewed in consultation with the Government of India and it has been decided by RBI to withdraw the facility from November 01. (DIR Series) Circular No 13 dated October 6.

I bank may allow remittances up to fifteen per cent of the average annual sales/income or turnover during the last two financial years or up to twenty-five per cent of the net worth.I banks may permit their exporter constituents to extend trade related loans / advances to overseas importers out of their EEFC balances without any ceiling. g) All other exporters resident in India The eligible credits represent inward remittance received through normal banking channel.f) Electronic Hardware Technology Parks (EHTPs).I bank.000. AD Category . are to be treated as eligible foreign exchange earnings for the purpose of credit to the EEFC A/c AD Category . iii) The details of bank accounts opened in the overseas country should be promptly reported to the AD Category . if the amount exceeds USD 100. 9. Setting Up Offices Abroad and Acquisition of Immovable Property for Overseas Offices a. other than the remittance received pursuant to any undertaking given to the Reserve Bank or which represents foreign currency loan raised or investment received from outside India or those received for meeting specific obligations by the account holder. Remittances for Recurring expenses: AD Category . Payments received in foreign exchange by a unit in Domestic Tariff Area (DTA) for supplying goods to a unit in Special Economic Zone out of its foreign currency a/c. subject to overseas borrower providing a guarantee from a bank of international repute situated outside India. Any funds rendered surplus should be repatriated to India.I banks may permit exporters to repay packing credit advances whether availed in Rupee or in foreign currency from balances in their EEFC A/c and / or rupee resources to the extent exports have actually taken place. Hyderabad 46 . whichever is higher.I banks may allow remittance up to ten per cent of the average annual sales/income or turnover during the last two financial years for the purpose of normal business operations of the office (trading / nontrading) / branch or representative office outside India as per the provisions of the Regulations in this regard subject to the following terms and conditions that the overseas office (trading / non-trading) / branch / representative should not: i) Create any financial liabilities contingent or otherwise for the head office in India. ii) Invest surplus funds abroad without prior approval of Reserve Bank of India. Remittances for initial expenses: AD Category . Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. b.

on lease. hire. 11. to acquire immovable property outside India for its business and for residential purpose of its staff. dollar will be considered by the Reserve Bank. Export of Goods on Lease. Hyderabad 47 . No fund based/or non-fund based facilities would be permitted against the balances in the Escrow Account.. Counter-Trade Arrangement i) Counter trade proposals involving adjustment of value of goods imported into India against value of goods exported from India in terms of an arrangement voluntarily entered into between the Indian party and the overseas party through an Escrow Account opened in India in U.e. Exporters should apply for Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Repatriation of contract value by overseas office of software export company: In addition to the above. It may utilize the entire amount of the contract value of ‘on-site’ contracts for contract related expenses including office/branch expenses abroad but at least repatriate the profits of ‘on-site’ contract after the completion of the said contract. Hire. d. basis under agreement with the overseas lessee against collection of lease rentals/hire charges and ultimate re-import require prior approval of the Reserve Bank. in a block of 12 months) and the banks may pay interest at the applicable rate. 10. 1999 and the Rules and Regulations made there under. within the above limits for initial and recurring expenses. etc. equipment. No interest will be payable on balances standing to the credit of the Escrow Account but the funds temporarily rendered surplus may be held in a short-term deposit up to a total period of three months in a year (i.c. All imports and exports under the arrangement should be at international prices in conformity with the Foreign Trade Policy and Foreign Exchange Management Act. etc Export of machinery..I bank to the concerned regional office of the Reserve Bank. Acquitsition of immovable property: AD Category . . ii) Application for permission for opening an Escrow Account may be made by the overseas exporter/organisation through his AD Category .S. etc. expenses and repatriation thereon may be sent to the AD Category I bank..I banks may now allow remittances by a company incorporated in India having overseas offices. the overseas office / branch of software exporter company / firm may repatriate to India 100 per cent of the contract value of each ‘off-site’ contract. A duly audited yearly statement showing receipts under ‘off-site’ and ‘on-site’ contracts undertaken by the overseas office.

per exhibition/trade fair. to the concerned regional office concerned of the Reserve Bank.I bank. (b) Unsold exhibit items may be sold outside the exhibition/trade fair in the same country or in a third country.necessary permission. (c) It would also be permissible to `gift' unsold goods up to the value of US $ 5000 per exporter. Exporters may deposit the foreign exchange obtained by sale of goods at the international exhibition/trade fair and operate the account during their stay outside India provided that the balance in the account is repatriated to Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. The exporter shall produce relative Bill of Entry within one month of reimport into India of the unsold items. iii. 2000. (d) AD Category . Repatriation. giving full particulars of the goods to be exported.I banks will be subject to 100% audit by their internal inspectors/auditors. Participation in Trade Fairs Abroad (a) Firms/Companies and other organisations participating in Trade Fair/Exhibition abroad are now permitted to take/export goods for exhibition and sale outside India without the prior approval of the Reserve Bank of India. 12. (e) Participants in international exhibition/trade fair have been granted general permission for opening a temporary foreign currency account abroad.I banks may approve GR Form of export items for display or display-cum-sale in trade fairs/exhibitions outside India subject to the following. and Surrender of Foreign Exchange) Regulations.I bank the method of disposal of all items exported. The sale proceeds of the items sold are repatriated to India in accordance with the Foreign Exchange Management (Realisation. i. ii. Such sales at discounted value are also permissible. as well as the repatriation of proceeds to India. Such transactions approved by the AD Category . through an AD Category . The exporter shall report to the AD Category . Hyderabad 48 .

AD Category .I banks. 13. c) Exporters desiring to submit bids for execution of projects abroad including service contracts have been allowed issue corporate guarantee in lieu of Bid Bond Guarantee.e. Regulations relating to ‘Project Exports’ and ‘Service Exports’ are laid down in the Memorandum on Project Exports (PEM) (furnished in Annexure 4).I bank /Exim Bank/Working Group at post-award stage before undertaking execution of such contracts. Project Exports and Service Exports a) Export of engineering goods on deferred payment terms and execution of turnkey projects and civil construction contracts abroad are collectively referred to as ‘Project Exports’. six months from the date of export and the balance amount within a maximum period of two years from the date of export are not treated as deferred payment exports.I bank concerned.India within a period of one month from the date of closure of the exhibition/trade fair and full details are submitted to the AD Category . The exporters may be allowed to abandon the books which remain unsold at the expiry of the period of the sale contract. Accordingly. In the case of export of books on consignment basis. Export on Elongated Credit Terms Exporters intending to export goods on elongated credit terms may submit their proposals giving full particulars through their banks for consideration to the Regional Office concerned of the Reserve Bank. provided the exporter does not require / avail of any funded or non-funded facilities for such exports from AD Category . the Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. 14.I bank may approve such proposals allowing for realisation of export proceeds up to 360 days from the date of shipment.. b) Pure supply contacts (contracts for export of goods) where at least 90 percent of the export value is realised within the prescribed period i. Hyderabad 49 . Indian exporters offering deferred payment terms to overseas buyers and those participating in global tenders for undertaking turnkey/civil construction contracts abroad are required to obtain the approval of the AD Category . provided the amount of such guarantee shall not exceed 5 percent of the contract value.

iii) Both transactions of sale and purchase in ‘R’ Returns under FET-ERS are reported separately. The netting may be done as on the date of balance sheet of the unit in SEZ. However. there is no prescription of any time limit for realization of export proceeds by units in SEZs. 15. ii. b.exporters may show the value of the unsold books as deduction from the export proceeds in the Account Sales. c) Receipts of payment in precious metals for EOUs and units in SEZs: Payment of export may be received in the form of precious metals i. Realisation of Export Proceeds: At present. The exporter has made satisfactory arrangements for realisation of full export proceeds subject to the usual GR procedure. they will continue to follow GR/PP/SOFTEX procedure. ii) The relative GR/SDF forms will be treated as complete by the designated AD Category . d) Netting off of export receivables against import payments: AD Category I banks may allow ‘netting off’ of export receivables against import payments for units located in SEZs subject to the following: i) The ‘netting off’ of export receivables against import payments is in respect of the same Indian entity and the overseas buyer/supplier. Hyderabad 50 .I bank only after the entire proceeds are adjusted/received. Export of goods and services by Units in Special Economic Zones a. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Job Works abroad: Units in SEZs are permitted to undertake job work abroad and export goods from that country itself subject to the conditions that: i. Gold / Silver / Platinum by the Gem & Jewellery units in SEZs and EOUs in equivalent to value of jewellery exported on the condition that the sale contract provides for the same and the approximate value of the precious metals is indicated in the relevant GR / SDF / PP Forms.e. Processing / manufacturing charges are suitably loaded in the export price and are borne by the ultimate buyer.

A copy of the report may be forwarded to Department of Industrial Policy and Promotion (DIPP). etc.I banks have been permitted to undertake forfaiting. Such remittance may be permitted in advance in one lump sum or at monthly intervals as approved by the agency concerned. v) All the relevant documents are submitted to the concerned AD Category .I bank who should comply with all the regulatory requirements relating to the transactions.iv) The export/import transactions with ACU countries are kept outside the arrangement. Disposal of Copies of Export Declaration Forms (GR / PP / SOFTEX forms) (i) Copies of export declaration forms should be disposed of as under: (a) GR forms should be completed by the exporter in duplicate and both the copies submitted to the Customs at the port of shipment along with the shipping bill. to the concerned Regional Office under whose jurisdiction the SEZ falls. payable by the exporter as approved by the Exim Bank/the AD Category . Forfaiting Export-Import Bank of India (Exim Bank) and AD Category . e) Issue of equity shares against import of capital goods: Units in SEZs are permitted to issue equity shares to non-residents against import of capital goods subject to the following: i) The valuation should be verified by a Committee consisting of Development Commissioner and the appropriate Customs officials.. 17. It would be in order for the AD Category . ii) The SEZ units issuing equity in the above manner should report the particulars of the shared issued in the form ‘FC-GPR’. Customs will give their running serial number on both the copies after Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. for financing of export receivables. 16. Hyderabad 51 .I banks to allow remittance of commitment fee/service charges. Ministry of Commerce and Industry. together with the copy of the valuation certificate. f) AD Category .I bank concerned.I banks may permit units in DTAs to purchase foreign exchange for making payment for goods supplied to them by units in SEZs. Government of India.

I bank named in the GR form. (ii) Where Duplicate copy of GR form is misplaced or lost. After verifying and authenticating the declaration in form SDF. will henceforth be retained by the AD Category . However. They will then return the duplicate copy of the form to the exporter and retain the original for transmission to Reserve Bank. the Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Hyderabad 52 .I bank for negotiation or collection of export bills. the number and date of Reserve Bank approval and/or number and date of the relative RBI circular should be recorded at the appropriate place on the GR form. Exporters should submit the duplicate copy of the GR form again to Customs along with the cargo to be shipped.admitting the corresponding shipping bill. AD Category . After examination of the goods and certifying the quantity passed for shipment on the duplicate copy. (b) Within twenty-one days from the date of export. Note: (i) In the case of exports made under deferred credit arrangement or to joint ventures abroad against equity participation or under rupee credit agreement. The SDF form should be submitted in duplicate (to be annexed to the relative shipping bill) to the Commissioner of Customs concerned.I bank may accept another copy of duplicate GR form duly certified by Customs. the duplicate copy of the form together with a copy of invoice etc.digit running serial number. After the documents have been negotiated / sent for collection. the AD Category .I bank should report the transaction to Reserve Bank in statement ENC under cover of appropriate RSupplementary Return. the calendar year and a six. Customs will return it to the exporter for submission to the AD Category . The Customs serial number will have ten numerals denoting the code number of the port of shipment. exporter should lodge the duplicate copy together with relative shipping documents and an extra copy of the invoice with the AD Category . Customs will certify the value declared by the exporter on both the copies of the GR form at the space earmarked and will also record the assessed value. the existing declaration in GR form is replaced by a declaration in form SDF (Statutory Declaration Form).I bank and may not be submitted to Reserve Bank. (c) On account of introduction of Electronic Data Interchange (EDI) System at certain Customs offices where shipping bills are processed electronically.

Therefore. name of the exporter.... the export declaration (duplicate) form may be certified as under: "Proceeds amounting to. bill number. the share of exporters in the amount so received is disbursed through the bank which had handled the shipping documents.." (ii) The manner of disposal of PP forms is the same as that for GR forms.Commissioner of Customs will hand over to the exporter. submitted by the exporter for collection/negotiation of shipping documents. if any.. Hyderabad 53 . is within the powers delegated to them or has been duly approved by Reserve Bank... (f) Where a part of the export proceeds are credited to an EEFC account. The duplicate copy of the PP form will be Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College... wherever necessary. representing .I bank should ensure by random check of the relevant duplicate forms by their internal / concurrent auditors to confirm that nonrealisation or short realisation allowed.I bank will countersign the forms in accordance with the directions in paragraph B.... name of the AD Category ..I bank within 21 days from the date of export. one copy of the shipping bill marked ‘Exchange Control Copy’ in which form SDF has been appended for being submitted to the AD Category . The certificate will indicate the number of declaration form. The AD Category .. The AD Category . date of negotiation.. (d) In cases where ECGC initially settles the claims of exporters in respect of exports insured with them and subsequently receives the export proceeds from the buyer/buyer’s country through the efforts made by them.% of the export realisation credited to the EEFC account maintained by the exporter with. In such cases.2 and return the original copy to the exporter. (e) The AD Category .I bank.I bank should accept the Exchange Control (EC) copy of the shipping bill and form SDF appended thereto.I bank. PP forms should be first presented by the exporter to an AD Category .. Postal Authorities will allow export of goods by post only if the original copy of the form has been countersigned by an AD Category . who should submit the form to the post office with the parcel. The manner of disposal of EC copy of shipping Bill (and form SDF appended thereto) is the same as that for GR forms.I bank for countersignature. ECGC will issue a certificate to the bank which had handled the relevant shipping documents after full proceeds have been received. invoice value and the amount actually received by ECGC.

that he could do so. The concerned overseas branch or correspondent should be instructed to deliver the parcel to consignee against payment or acceptance of relative bill. 19..e. on the basis of the standing and track record of the exporter and the arrangements made for realisation of the export proceeds. Hyderabad 54 .I banks should countersign the PP forms after ensuring that the parcel is being addressed to their branch or correspondent bank in the country of import.I bank under his stamp and signature. the exporters should bill their overseas clients periodically. AD Category . In such cases. at least once a month or on reaching the ‘milestone’ as provided in the contract entered into with the overseas client and the last invoice/bill should be raised not later than 15 days from the date of completion of the contract. Any alteration in the name and address of consignee on the PP form should also be authenticated by the AD Category . etc.I bank Or b. It would be in order for the exporters to submit a Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. provided: a.retained by the AD Category . 18. The AD Category . Counter Signature on PP Forms PP forms will be presented by the exporter to an AD Category . particulars of advance payment/letter of credit/AD Category .(Software) (i) In respect of long duration contracts involving series of transmissions.I banks may. of the exporter should be furnished on the form under proper authentication.I bank’s certification of standing.Invoicing .I bank to whom the exporter should submit relevant documents together with an extra copy of invoice for negotiation/collection. i.I bank for counter signature.I bank is satisfied. AD Category . Terms of Payment . An irrevocable letter of credit for the full value of the export has been opened in favour of the exporter and has been advised through the AD Category . countersign PP forms covering parcels addressed direct to the consignees. however.. within the prescribed period of twenty-one days.I bank concerned Or The full value of the shipment has been received in advance by the exporter through an AD Category .

by random check of the relevant duplicate forms by their internal / concurrent auditors.. that non-realisation or short realisation allowed. The designated officials may also certify the SOFTEX Forms of EOUs which are registered with them.. Note: (i) In all the above procedures AD Category ...combined SOFTEX form for all the invoices raised on a particular overseas client. (ii) Where a part of the export proceeds are credited to an EEFC account.. will henceforth be retained by the AD Category ... the procedure indicated in Regulation 6 of Export Regulations is to be observed. (ii) In respect of contracts involving only ‘one shot operation’.. if any...I bank and may not be submitted to Reserve Bank.. is within the powers delegated to them or has been duly approved by Reserve Bank. Disposal of SOFTEX Forms As for disposal of SOFTEX forms. Shut out Shipments and Short Shipments Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Hyderabad 55 . (iii) The exporter should submit declaration in Form SOFTEX in triplicate in respect of export of computer software and audio / video / television software to the designated official concerned of the Government of India at STPI / EPZ /FTZ /SEZ for valuation / certification not later than 30 days from the date of invoice / the date of last invoice raised in a month. including advance remittances received in a month.% of the export realisation credited to the EEFC account maintained by the exporter with. the export declaration (duplicate) form may be certified as under: "Proceeds amounting to." 21.. (iv) The invoices raised on overseas clients as at (i) to (iii) above will be subject to valuation of export declared on SOFTEX form by the designated official concerned of the Government of India and consequent amendment made in the invoice value. representing . the invoice/bill should be raised within 15 days from the date of transmission. as indicated above... 20.. However.. the duplicate copy of the form together with a copy of invoice etc.I bank banks should ensure. if necessary. wherever necessary.

Hyderabad 56 . AD Category .I bank to the effect that he has filed the short-shipment notice with the Customs and that he will furnish it as soon as it is obtained.I banks may also accept Forwarder’s Cargo Receipts (FCR) issued by steamship companies or their agents (instead of 'IATA' approved agents).(i) When part of a shipment covered by a GR form already filed with Customs is short-shipped. Consolidation of Air Cargo Where air cargo is shipped under consolidation. relative sale contract with the overseas buyer should also provide that FCR may be accepted in lieu of bill of lading as a shipping document. the form should be presented by exporter or his agent at the Customs station at the border Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. 23. in lieu of bills of lading. the exporter will give notice in duplicate to the Customs in the form and manner prescribed. rail or river transport: a. of export transactions backed by letters of credit.I banks may negotiate HAWBs only if the relative letter of credit specifically provides for negotiation of these documents in lieu of Airway Bills issued by the airline company. In case of delay in obtaining certified short-shipment notice from the Customs. (ii) Where a shipment has been entirely shut out and there is delay in making arrangements to re-ship. If the shipment is made subsequently. In this case. in lieu of bill of lading. 22. Further. AD Category . attaching thereto the unused duplicate copy of GR form and the shipping bill. The Customs will verify that the shipment was actually shut out. In case of exports by barges/country craft/road transport. the airline company’s Master Airway Bill will be issued to the Consolidating Cargo Agent who will in turn issue his own House Airway Bills (HAWBs) to individual shippers. a fresh set of GR form should be completed. certify the copy of the notice as correct and forward it to the Reserve Bank together with unused duplicate copy of the GR form. for negotiation / collection of shipping documents. Exports by Barges/Country Craft/Road Transport Following procedure should be adopted by exporters for filing original copies of GR/SDF forms where exports are made to neighbouring countries by road. the exporter must give notice of short-shipment to the Customs in the form and manner prescribed. the exporter should give an undertaking to the AD Category . the original GR form received earlier from Customs will be cancelled. only if the relative letter of credit specifically provides for negotiation of this document.

24. In respect of goods loaded at stations other than the designated stations. v) There will be no monetary transaction under the barter trade trade agreement. main points of which are listed below: i) Under the Border Trade Agreement between India and Myanmar.17 dated 16th October 2000. Hyderabad 57 .P. by people living along the IndiaMyanmar border on both sides under barter trade arrangement as also trade in freely convertible currency. Customs staff has been posted at certain designated railway stations for attending to Customs formalities. The list of designated railway stations is obtainable from the Railways. vi) The consignment of imports and exports should be invoiced in USD. As regards exports by rail. iv) The border trade will be restricted to items agreed to as per Border Trade Agreement with Myanmar. Barter trade with Myanmar In terms of an agreement on Border Trade between India and Myanmar.through which the vessel or vehicle has to pass before crossing over to the foreign territory. exchange of certain specified locally produced commodities. Such barter trade transactions shall take place only by way of head load or non-motorised transport system. ii) The barter trade shall be restricted to land route as per the Border Trade Agreement between the two countries. For this purpose. imports from Myanmar into India should precede exports from India to Myanmar. exporters must arrange to present GR/SDF forms to the Customs Officer at the Border Land Customs Station where Customs formalities are completed. has been permitted.I banks should follow strictly the revised guidelines issued in terms of A. AD Category .(DIR Series) Circular No. exporter may arrange either to give the form to the person in charge of the vessel or vehicle or forward it to his agent at the border for submission to Customs. iii) Imports from Myanmar to India shall precede export from India to Myanmar. They will collect the GR/SDF forms in respect of goods loaded at these stations so that the goods may move straight on to the foreign country without further formalities at the border. b. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.

viii) Exports from India to Myanmar under barter trade of the value not However. The bank branches will countersign GR forms original and duplicate. such transactions should be exceeding USD 1000 per transaction are exempt from declaration on the prescribed form viz. in a register. RBI. along with a copy of the contract for import and export with Myanmar parties. (a) United Bank of India.. GR form. Hyderabad 58 . submitted to them by the exporters. Guwahati. x) The designated branches of AD Category . xiii) On completion of export against receipt of payment in the form of import of goods/commodities from Myanmar.B. Moreh Branch. within 15 days from the close of the month. where the value exceeds USD 5000. Champai Branch should only handle proposals for barter trade and documents relating to imports and exports thereunder. the concerned designated bank Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. for countersignature on GR forms before submitting them to Customs authorities. Manipur and (b) State Bank of India. They should also submit a monthly statement to Foreign Exchange Department. Both original and duplicate copies of the forms should be returned to the exporter which may be superscribed as under: “Exports under barter arrangement with Myanmar. R. xi) The exporters should approach the designated branches as per (x) above. after satisfying themselves that the GR forms are supported by a Bill of Entry for import of goods from Myanmar to India. Customs authorities at the Indo-Myanmar border will report import/export transactions of value not exceeding USD 1000 to the Foreign Exchange Department.vii) The value of goods exported under barter trade should not exceed USD 20. The payments have been received in the form of goods/commodities of the equivalent value” xii) The designated banks should maintain a record of the transactions under the barter trade arrangement on the basis of GR forms countersigned by them.I banks viz. Guwahati on monthly basis.I.000 per transaction. ix) On import of goods the party should submit documentary evidence such as Bill of Entry to the designated bank. completed in one or two days.

where the marine insurance is taken by the exporters on buyer’s account. F. RBI. Delay in submission of shipping documents by exporters In cases where exporters present documents pertaining to exports after the prescribed period of twenty-one days from date of export. export value or country of destination. Inter se discrepancies: AD Category . Likewise. In the case of SDF form. etc. Bill of Lading/Shipping Bill: The number on the duplicate copy of a GR form presented to them is the same as that of the original which is usually recorded on the Bill of Lading/Shipping Bill and the duplicate has been duly verified and authenticated by appropriate Customs authorities.I banks may handle them without prior approval of Reserve Bank. C. Scrutiny of export declaration Forms AD Category .I.I banks may accept the Bill of Lading/Airway Bill issued on ‘freight prepaid’ basis where the sale contract is on F. in the case of C. it should be ensured that the deduction made is only to the extent of freight declared on GR/SDF form or the actual amount of freight indicated on the Bill of Lading/Airway Bill. contracts where the freight is sought to be paid at destination. Guwahati.& F. etc. Freight Payment: AD Category . ii. provided they are satisfied with the reasons for the delay.I bank Category – I Banks may ensure the following while accepting the export declaration forms (GR/SDF): i.A. 26.B. AD Category . should be the same as that appearing on the Bill of Lading. iii. basis provided the amount of freight has been included in the invoice and the bill. Hyderabad 59 .O. Conversely.I banks to ensure that the documents submitted do not reveal any material inter se discrepancies in regard to description of goods exported. xiv) The transactions relating to barter trade should not be reported in R Returns.should surrender the duplicate copy of GR form and evidence of import to the Foreign Exchange Department. AD Category . Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. the Shipping Bill No.S.I banks should verify that the actual amount paid is received from the buyer through invoice and the bill. 25... whichever is less. along with monthly statement.F.

i. require the constituent concerned also to sign such declaration and thereupon such constituent shall be bound to comply with such requisition and such constituent signing the declaration shall be considered to be the exporter for the purposes of these Regulations to the extent of the full value shown in the documents being negotiated or sent for collection and shall be governed by these Regulations. the final settlement of price may be dependent on the results of quality analysis of samples drawn at the time of shipment. the Authorised Dealer shall a) Where the value declared in the declaration does not differ from the value shown in the documents being negotiated or sent for collection.Notes : A. In these cases. part or whole of any freight increase taking place after the contract was concluded is agreed to be borne by buyers or where as a result of subsequent devaluation of the currency of the contract. Provided that before accepting such documents for negotiation or collection. or b) Where the value declared in the declaration is less than the value shown in the documents being negotiated or sent for collection. buyers have agreed to an increase in price. Hyderabad 60 .f. but the results of such analysis will become available only after the shipment has been made. invoices submitted along with Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Transfer of Documents: AD Category .. Differences in Value due to quality analysis / late shipment penalty: In certain lines of export trade. for negotiation or collection. contracts may provide for payment of penalty for late shipment of goods in conformity with trade practice concerning the commodity. or c. while exporters declare to the Customs the full export value based on the contract price. B. Differences in Value due to Freight : The export realisable value may be more than what was originally declared to/accepted by the Customs on the GR/SDF form in certain circumstances such as where in c. & f. Sometimes.I bank may accept. contracts. shipping documents including invoice and bill of exchange covering exports. C. from his constituent who is not a person who has signed the declaration (GR/PP/SDF/SOFTEX).

27.I bank through whom the advance payment is received. if any. and (3). Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Trade Discount Bills for exports by sea or air which fall short of the value declared on GR/SDF forms on account of trade discount may be accepted for negotiation or collection only if the discount has been declared by the exporter on relative GR/SDF form at the time of shipment and accepted by Customs. 28. payable on the advance payment does not exceed London Inter-Bank Offered Rate (LIBOR) + 100 basis points. as the case may be. the documents covering the shipment are routed through the AD Category . As these variations stem from the terms of contract. Note: Purchase of foreign exchange from the market for refunding advance payment credited to EEFC account may be allowed only after utilising the entire balances held in the exporter’s EEFC accounts maintained at different branches/banks. be ensured that the shipments made against the advance payments are monitored by the AD Category .shipping documents for negotiation/collection may reflect a different value arrived at after taking into account the results of analysis of samples or late shipment penalty. AD Category . from a buyer outside India. (2). the shipment of goods is made within one year from the date of receipt of advance payment. It should. Exporter receiving advance payment (with or without interest).I bank through whom the advance payment is received. the rate of interest. The appropriations made against every shipment must be endorsed on the original copy of the inward remittance certificate issued for advance remittance. Hyderabad 61 . Advance Payments against Exports Exporters may receive advance payments (with or without interest) from their overseas buyers. however. shall be under an obligation to ensure that – (1).I banks may accept them on production of documentary evidence after verifying the arithmetical accuracy of the calculations and on conforming the terms of underlying contracts.

Notwithstanding anything contained in clause (1) above. AD Category . should instruct the latter to deliver them only against trust receipt/undertaking to deliver sale proceeds by a specified date within the period prescribed for realisation of proceeds Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. it is the practice to leave a small part of the invoice value undrawn for payment after adjustment due to differences in weight. Note: In cases where the exporter has not been able to arrange for repatriation of the undrawn balance in spite of best efforts.I banks may negotiate the bills.I bank. within one year from the date of receipt of advance payment. shall be made after the expiry of the said period of one year. on being satisfied with the bona fides of the case. 29. no remittance towards refund of unutilised portion of advance payment or towards payment of interest. The amount of undrawn balance is considered normal in the particular line of export trade. provided: a. while forwarding shipping documents to his overseas branch/correspondent. to be ascertained after arrival for inspection. should ensure that the exporter has realised at least the value for which the bill was initially drawn (excluding undrawn balances) or 90% of the value declared on GR/PP/SDF form. In such cases. without the prior approval of the Reserve Bank. etc. An undertaking is obtained from the exporter on the duplicate of GR/SDF/PP forms that he will surrender/account for the balance proceeds of the shipment within the period prescribed for realisation. 30. whichever is more and a period of one year has elapsed from the date of shipment.In the event of the exporter's inability to make the shipment. quality. subject to a maximum of 10 per cent of the full export value b. AD Category . Consignment Exports (i) When goods have been exported on consignment basis. or analysis of the goods. where the export agreement provides for shipment of goods extending beyond the period of one year from the date of receipt of advance payment. partly or fully. AD Category . Part Drawings In certain lines of export trade.I banks. the exporter shall require the prior approval of the Reserve Bank. Hyderabad 62 .

. stamp duty etc. (ii) The agents/consignees may deduct from sale proceeds of the goods expenses normally incurred towards receipt. Opening / Hiring Warehouses Abroad: AD Category . warehouse rent. a bill for part of the estimated value is drawn in advance against the exports. All transactions should be routed through the designated branch of the AD Category . Exports to CIS Countries and East European Countries: Reserve Bank will permit on application.00. Notes: A.000 during the last year.I banks may consider the applications received from exporters and grant permission for opening / hiring warehouses abroad subject to the following conditions: a) Applicant's export outstanding does not exceed 5 per cent of exports made during the previous year. B. Deductions in Account Sales should be supported by bills/receipts in original except in case of petty items like postage/cable charges. freight and marine insurance must be arranged in India. according to the practice in certain trades. exporters with satisfactory track record. handling charges. such as landing charges. Payment of Freight and Marine Insurance: In case of goods exported on consignment basis.I bank. b) Applicant has a minimum export turnover of USD 1. and remit the net proceeds to the exporter (iii) The account sales received from the Agent/Consignee should be verified by the AD Category . a longer period up to twelve months for realisation of export proceeds for exports on consignment basis made to CIS countries and East European countries financed in any permitted currency.I bank. C. storage and sale of the goods. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. This procedure should be followed even if. c) Period of realisation should be as applicable i. etc.e. 180 days for nonstatus holder exporters and 12 months for status holder exporters.of the export. Hyderabad 63 .

AD Category . (ii) In cases not covered by (i) above also. AD Category . Or They may also despatch shipping documents direct to the consignees or their agents resident in the country (b) Where an irrevocable letter of credit has been received for the full value of the export shipment and the underlying letter of credit provides for despatch of documents direct to the consignee or his agent resident in the country of final destination of goods. of final destination of goods in the following cases: (a) Where advance payment has been received for the full value of the export shipment and the underlying sale contract provides for despatch of documents direct to the consignee or his agent resident in the country of final destination of goods.I banks may permit `Status Holder Exporters' (as defined in the Foreign Trade Policy). Direct Despatch of Shipping Documents (i) While AD Category .I banks should normally despatch shipping documents to their overseas branches/correspondents expeditiously. Hyderabad 64 . direct to the consignee / agent provided the exporter is a regular customer and the AD Category I bank is satisfied.I banks granting such permission / approvals should maintain a proper record of the approvals granted. that the request can be acceded to. on the basis of standing and track record of the exporter and the arrangements made for realisation of export proceeds. (iii) Documents in respect of goods or software which are accompanied with a declaration by the exporter that they are not more than Rupees Twenty Five Thousand in value and not declared on GR/SDF/PP/SOFTEX form. for despatch of documents for whatever reason. (v) AD Category . may be directly sent by the exporter to the consignee. and units in Special Economic Zones (SEZ) to despatch the Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.I banks may accede to the request of the exporter.The above permissions may be granted to the exporters initially for a period of one year and their renewals may be considered subject to the applicant satisfying the requirement at (a) above. in terms of paragraph 26. 31. in terms of paragraph 2 may be directly sent by the exporter to the consignee. (iv) Documents in respect of goods exported against 100% advance remittance.

2008) 32. provides for such delivery. b) The exporter is a regular customer of AD Category . inter alia. (DIR Series) Circular No.I banks may deliver one negotiable copy of the Bill of Lading to the Master of the carrying vessel or trade representative for exports to certain landlocked countries if the shipment is covered by an irrevocable letter of credit and the documents conform strictly to the terms of the Letter of Credit which. b. to regularize cases of dispatch of shipping documents by the exporter direct to the consignee or his agent resident in the country of the final destination of goods. subject to the following conditions: a) The export proceeds have been realized in full. (vi) With view to further liberalise the facilities available to the exporters and to simplify the procedure. it has been decided by RBI to allow AD Category . 33. e) In case of doubt. Export Bills Register Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. P. 06 dated August 13. Handing Over Negotiable Copy of Bill of Lading to Master of Vessel/Trade Representative AD Category . by the exporters within 21 days from the date of export. per export shipment.I bank named in the GR Form. c) The exporter’s account with the AD Category – I bank is fully compliant with Reserve Bank’s extant KYC / AML guidelines. up to USD 1 million or its equivalent. The export proceeds are repatriated through the AD Category .I banks.I bank for a period of at least six months.export documents to the consignees outside India subject to the terms and conditions that: a.I bank for monitoring purposes. The duplicate copy of the GR form is submitted to the AD Category . d) The AD Category – I bank is satisfied about the bonafides of the transaction. the AD Category – I bank may consider filing Suspicious Transaction Report (STR) with FIU_IND (Financial Intelligence Unit in India). Hyderabad 65 . (A.

except in case of undrawn balances covered by Note under paragraph 27. Details of GR/SDF/PP form number. 50 dated 03. where possible. announced in the Annual Policy Statement for the Year 2008-09 (para 134) to enhance the present period of realization and repatriation to India of the amount representing the full export value of goods or software exported. the matter should be promptly taken up with the concerned exporter. Any laxity in the follow up of realisation of export proceeds by Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. from six months to twelve months from the date of export. The bill numbers should be recorded in ENC statement and other relevant returns submitted to Reserve Bank.2008) (i) AD Category . ii. therefore. should be available. subject to review after one year. The duplicate copies of GR / SDF / PP Forms should. It has. January to December). (A. (ii) AD Category . however.i. AD Category . The provisions in regard to period of realization and repatriation to India of the full export value of goods or software exported by a unit situated in Special Economic Zone (SEZ) as well as exports made to warehouses established outside India with the permission of Reserve Bank remain unchanged.I banks should follow up export outstandings with exporters systematically and vigorously so that action against defaulting exporters does not get delayed. the reason for the delay in realising the proceeds.I.B. P. in consultation with Government of India.I banks should maintain Export Bills Register. due date of payment. If the exporter fails to arrange for delivery of the proceeds.I banks should closely watch realisation of bills and in cases where bills remain outstanding. 34. the fortnightly period of R Supplementary Return with which the ENC statement covering the transaction was sent to R. Follow-up of Overdue Bills Reserve Bank has been receiving representations from Exporters / Trade bodies to extend the period of realisation of export proceeds in view of the external environment. within twelve months or seek extension of time beyond twelve months the matter should be reported to Reserve Bank stating. Hyderabad 66 . AD Category .06. in physical or electronic form. been.I bank until the full proceeds are realised. continue to be held by AD Category .I banks should ensure that all types of export transactions are entered in the Export Bills Register and are given bill numbers on calendar year basis (i.e. (DIR Series) Circular No. beyond the due date for payment or twelve months from the date of export.

I banks may allow cash discount to the extent of amount of proportionate interest on the unexpired period of usance. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. The statement should be submitted in triplicate within fifteen days from the close of the relative half-year. Software Technology Parks (STPs) and Bio–Technology Parks (BTPs) Schemes are permitted to realise and repatriate the full value of export proceeds within a period of 12 months from the date of export in respect of export made on or after September 1. The units in SEZs will however continue to follow the GR/ PP / SOFTEX export procedure outlined in this Handbook.I banks will be viewed seriously by R. Reduction in Invoice Value on Account of Prepayment of Usance Bills Occasionally. if satisfied about genuineness of the request. on half-yearly basis. (iii) Exporters who have been certified as `Status Holder' in terms of Foreign Trade Policy are permitted to realise and repatriate the full value of export proceeds within a period of 12 months from the date of shipment. its amount thereof is desired to be reduced for any reason. exporters may approach AD Category . AD Category . Reduction in Value If. (iv) 100% Export Oriented Units (EOUs) and units set up under Electronic Hardware Technology Parks (EHTPs). 36. (vi) AD Category .AD Category .I. 35.B. In such cases AD Category . after a bill has been negotiated or sent for collection. (v) The stipulation of twelve months or extended period thereof for realisation of export proceeds is no longer applicable for units located in Special Economic Zones (SEZs). provided: a.I banks should furnish to Reserve Bank.I banks for reduction in invoice value on account of cash discount to overseas buyers for prepayment of the usance bills.I bank may approve such reduction. leading to the invocation of the penal provisions under FEMA 1999. 2004. The reduction does not exceed 25% of invoice value. Hyderabad 67 . calculated at the rate of interest stipulated in the export contract or at the Prime rate/LIBOR of the currency of invoice where rate of interest is not stipulated in the contract. a consolidated statement in Form XOS giving details of all export bills outstanding beyond six months from the date of export as at the end of June and December every year.

i. It does not relate to export of commodities subject to floor price stipulations. reduction in invoice value may be allowed.b. Hyderabad 68 . 38. if any. the export outstandings do not exceed 5% of the average annual export realisation during the preceding three calendar years. Where the reduction in value exceeds 10%. In all such cases of remittances. received by him.I banks may remit export claims on application. outstanding of exports made to countries facing externalisation problems may be ignored provided the payments have been made by the buyers in the local currency. The exporter is advised to surrender proportionate export incentives availed of. Self write-off. 37. The exporter is not on the exporters’ caution list of Reserve Bank. Change of buyer/consignee Prior approval of Reserve Bank is not required if. they are to be transferred to a buyer other than the original buyer in the event of default by the latter. the exporter should be advised to surrender proportionate export incentive. provided the reduction in value. without any percentage ceiling. and d.e. if any. if any. 39. Export Claims AD Category . subject to the above conditions as also subject to their track record being satisfactory. For the purpose of reckoning the percentage of export bills outstanding to the average export realisations during the preceding three calendar years. after goods have been shipped. Reduction in Invoice Value and Extension of Time All exporters (including Status Holder) have been allowed to: Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. all other relevant conditions stipulated in paragraph 34 should also be satisfied. c.. provided the relative export proceeds have already been realised and repatriated to India and the exporter is not on the caution list of Reserve Bank. involved does not exceed 10% and the realisation of export proceeds is not delayed beyond the period of six months from the date of export. In the case of exporters who have been in the export business for more than three years.

The AD Category . the exporter has sought necessary approval for write-off. AD Category .(a) Write off (including reduction in invoice value) outstanding export dues and. (e) In cases where exporters have failed to comply with the above requirement. (b) Extend the prescribed period of realisation beyond 180 days or further period as applicable.I bank can avail of this facility through each AD.I bank but unrealised as at the end of calendar year will be computed for export proceeds due in the following year. the AD Category .I banks may promptly advise the exporter concerned to seek extension of time/reduction in invoice value/write-off in respect of non-realisation in excess of the 10 per cent limit. realised and not realised to the AD Category . provided the lead bank of the consortium or in case of multiple banking. the limit of 10 per cent for self write-off (including reduction in invoice value) and extension of time for realisation of export proceeds would be applicable for export bills lodged for realisation with that AD Category .I bank. a nodal bank. as the case may be. exporters should submit a statement as per prescribed format.I bank will be required to verify the statement with his records and review the export performance of the exporter during the calendar year to ascertain that in cases where the 10 per cent limit of self extension. giving details of export proceeds due. reduction in invoice value or extension of time.e. provided the aggregate value of such export bills written-off (including reduction in invoice value) and bills extended for realisation does not exceed 10 per cent of the export proceeds due during the calendar year and such export bills are not a subject of investigation by Enforcement Directorate / Central Bureau of Investigation or any other Investigating Agencies. undertakes to verify the exporters’ annual performance on behalf of all the banks. write-off (including reduction in invoice value) and non-realisation has been breached. failing which. Export bills due in the year for which the exporter has extended the period of realisation on his own (within the 10 per cent limit) or sought extension of time from the AD Category . i.I banks may inform the exporter 69 Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.I bank concerned.. (c) Exporters dealing with more than one AD Category . (d) Within a month from the close of the calendar year. However. Hyderabad . for the excess over the 10 per cent limit before the end of the calendar year. exporters operating under a consortium of banks or with multiple banks will also have the option of computing the 10 per cent limit on an aggregate basis with all the banks.

d. but expects to be able to realise proceeds if extension of the period is allowed to him. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. While considering extension beyond one year from the date of export. The date up to which extension has been granted is indicated in the `Remarks’ column of the XOS statement f. extension may be granted irrespective of the amount involved / outstanding. c. whichever is higher.I banks to extend the period of realisation of export proceeds beyond 6 months from the date of export up to a period of six months. e.I bank is satisfied that the exporter has not been able to realise export proceeds for reasons beyond his control. irrespective of the invoice value of the export subject to the following conditions : a. The exporter submits a declaration that he will realise the export proceeds during the extended period. The export transactions covered by the invoices are not under investigation by Enforcement Directorate / Central Bureau of Investigation or other investigating agencies. the total outstanding of the exporter does not exceed USD one million or 10 per cent of the average export realisations during the preceding three financial years. (ii) Reserve Bank of India has permitted the AD Category . for reasons beyond his control. Extension of Time Limit in Other Cases 1. (i) In cases where an exporter has not been able to realise proceeds of a shipment made within the period prescribed. In cases where the exporter has filed suits abroad against the buyer. 40. under advice to the Regional Office concerned of the Reserve Bank.I bank with appropriate documentary evidence in respect of cases not falling under para (ii) below. necessary application (in duplicate) should be made to the Regional Office concerned of Reserve Bank in form ETX through his AD Category . Hyderabad 70 . b. The AD Category .about the withdrawal of this facility of self write-off / extension of time. within a month. at a time.

I banks shall. 42. Place where the claim is payable. the AD Category . Shipments Lost in Transit When shipments from India for which payment has not already been received either by negotiation of bills under letters of credit or otherwise are lost in transit. Note: Sometimes claims on shipments lost in transit are also partially settled directly by shipping companies/airlines under carrier’s liability. Cases which are not covered by the above instructions would require prior approval from the Regional Office of the Reserve Bank. write off the relative export bills and delete them from the XOS statement. A certificate for the amount of claim received should be furnished on the reverse of the duplicate copy. Such write-off will not be restricted to the limit of 10 per cent indicated in paragraph 43 below. Payment of Claims by ECGC / insurance companies registered with IRDA AD Category . In cases where the claim is payable abroad. Name and address of the insurance company. 41. Amount for which shipment was insured. AD Category . Surrender of incentives. Hyderabad 71 . the AD Category . c. b.I banks should ensure that amounts of such claims if settled abroad are also repatriated to India by exporters. in such cases will be as provided in the Foreign Trade Policy. on an application received from the exporter supported by documentary evidence from the ECGC / insurance companies registered with IRDA confirming that the claim in respect of the outstanding bills has been settled by them. The duplicate copy of GR/SDF/PP form should be forwarded to Reserve Bank with following particulars: a. through the medium of his overseas branch/correspondent and release the duplicate copy of GR/SDF/PP form only after the amount has been collected.I bank must arrange to collect the full amount of claim due on the lost shipment.I bank must ensure that insurance claim is made as soon as the loss is known.g. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. if any.

I bank during a calendar year does not exceed 10% of the total export proceeds realised by the concerned exporter through the concerned AD Category . The goods exported have been auctioned or destroyed by the Port/Customs/Health authorities in the importing country. The overseas buyer is not traceable over a reasonably long period of time.I banks may accede to such requests subject to the under noted conditions: a. c. who had handled the relevant shipping documents.I bank. (A. Foreign Chamber of Commerce or similar Organisation. AD Category . The aggregate amount of write off allowed by the AD Category . Hyderabad 72 .I bank during the previous calendar year. Satisfactory documentary evidence is furnished in support of the exporter having made all efforts to realise the dues.P. The overseas buyer has been declared insolvent and a certificate from the official liquidator indicating that there is no possibility of recovery of export proceeds produced.It is clarified that the claims settled in rupees by ECGC / insurance companies should not be construed as export realisation in foreign exchange. 49 dated June 03. v. iv. 2008) 43. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. The unrealised amount represents the balance due in a case settled through the intervention of the Indian Embassy. The relevant amount has remained outstanding for one year or more. iii. with appropriate supporting documentary evidence with a request for write off of the unrealised portion. b. d. The unrealised amount represents the undrawn balance of an export bill (not exceeding 10% of the invoice value) remained outstanding and turned out to be unrealisable despite all efforts made by the exporter. "Write off" of Unrealised Export Bills (i) An exporter who has not been able to realise the outstanding export dues despite best efforts. (DIR Series) Circular No. ii. The case falls under any of the under noted categories: i. may approach the AD Category .

availed of in respect of the relative shipments. The case is not the subject matter of any pending civil or criminal suit.. The AD Category . The exporter has surrendered proportionate export incentives..……… (Amount in words and figures) permitted in terms of paragraph C.. Bills were drawn for the difference between the letter of credit value and actual export value or between the provisional and the actual freight charges but the amount has remained unrealised consequent on dishonour of the bills by the overseas buyer and there are no prospects of realisation.. (ii) Where there is no further amount to be realised against the GR/SDF/PP form covered by the write off.. vii." Stamp & Signature of Date …………………………. Star Trading Houses. The cost of resorting to legal action would be disproportionate to the unrealised amount of the export bill or where the exporter even after winning the Court case against the overseas buyer could not execute the Court decree due to reasons beyond his control.18 of Directions to Authorised Dealers. AD Category .. Authorised Dealer (iii) Status holders exporters (viz. Export Houses.I bank should certify the duplicate form as under: "Write off of. if any. AD Category .. x. Hyderabad 73 . viii.I banks are to put in place a system under which their internal inspectors or auditors carry out random sample check/percentage check of outstanding export bills written off... and recognised as such by DGFT. ix.. may be permitted to "write off" outstanding export bills up to extent of (i) 5 per cent of their average annual realisation during the preceding three financial years or (ii) 10 per cent of the Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.vi. Superstar Trading Houses) and manufacturer exporters exporting more than 50% of their production.I bank should obtain documents evidencing surrender of export incentives availed of before permitting the relevant bills to be written off. The exporter has not come to the adverse notice of the Enforcement Directorate or the Central Bureau of Investigation or any such other law enforcement agency. Trading Houses..

The exporter should submit to the concerned AD Category . Central Bureau of Investigation. the export realisation in the preceding three calendar years and also the amount of "write off " already availed of during the year. if any. Hyderabad 74 . etc. After the "write off" has been permitted Authorised Dealer may certify the duplicate form as under:"Write off of ……………………………(Amount in words and figures) permitted in terms of AP(DIR Series) Circular No.e.30 dated April 4. GR/SDF forms which are under investigation by agencies like. c. 3. the relevant GR/SDF Nos.. AD Category ." Date……………………… Stamp & Signature of Authorised Dealer 4. as also the outstanding bills which are subject matter of civil / criminal suit. 2001. 2.export proceeds due during the financial year. the export benefits. Exports made to countries with externalisation problem i. country of export. Bill No. Enforcement Directorate. availed of by the exporter have been surrendered.I banks may note to take into account the amount written off under this facility while arriving at the eligible amount. The limit will be cumulatively available in a year and subject to the following conditions. to be written off. invoice value. b. Directorate of Revenue Intelligence. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. b. 1. whichever is higher. It is clarified that the following do not qualify for the "write off" facility: a. where the overseas buyer has deposited the value of export in local currency but the amount has not been allowed to be repatriated by the central banking authorities of the country.I bank a Chartered Accountant’s certificate indicating – a. if any. commodity exported.

Remittance of Agency Commission on Exports (i) AD Category . 46.I banks may allow payment of commission. They may approve GR/SDF/PP forms of exporters who have been placed on caution list if the exporters concerned produce evidence of having received an advance payment or an irrevocable letter of credit in their favour covering the full value of the proposed exports.. 45. once submitted to the AD Category . should not ordinarily be returned to exporters. on application submitted by the exporter. The remittance on agency commission may be allowed subject to the following conditions: a. The relative shipment has already been made. Exporters’ Caution List AD Category . provided a valid agreement/written understanding between the exporter and/or beneficiary for payment of commission exists. either by remittance or by deduction from invoice value. Return of Documents to Exporters The duplicate copies of GR/SDF/PP forms and shipping documents. 44. AD Category . indicating details of write offs etc. remittance may be allowed after satisfying the reasons adduced by the exporter for not declaring commission on Export Declaration Form.I banks for negotiation. collection.I banks may forward a statement in form EBW to the Regional Office of Reserve Bank under whose jurisdiction they are functioning.I banks will also be advised whenever exporters are cautioned in terms of provisions contained in Regulation 17 of "Export Regulations". Amount of commission has been declared on GR/SDF/PP/SOFTEX form and accepted by the Customs authorities or Ministry of Information Technology. In cases where the commission has not been declared on GR/SDF/PP/SOFTEX form. except for rectification of errors and resubmission. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Government of India / EPZ authorities as the case may be.5. Such approval may be given even in cases where usance bills are to be drawn for the shipment provided the relative letter of credit covers the full export value and also permits such drawings and the usance bill mature within six months from the date of shipment. b. Hyderabad 75 . etc.

exercise due diligence regarding the track record of the exporter. 47.Dollar. Hyderabad 76 . ii. verify the bonafides of the transactions. in respect of their exports covered under counter trade arrangement through Escrow Accounts designated in U. Refund of Export Proceeds AD Category . The payment of commission satisfies the conditions as at (a) and (b) stipulated in paragraph above. The commission is not payable to Escrow Account holders themselves.(ii) AD Category . obtain from the exporter a certificate issued by DGFT / Custom authorities that no incentives have been availed by the exporter against the relevant export or the proportionate incentives availed. NOTE: Payment of commission is prohibited on exports made by Indian Partners towards equity participation in an overseas joint venture / wholly owned subsidiary as also exports under Rupee Credit Route except for tea & tobacco. c. While permitting such transactions. The commission should not be allowed by deduction from the invoice value. and v. b. In case of export of tea and tobacco to Russia under Rupee Credit Route AD Category . through whom the export proceeds were originally realised.I banks. if any. subject to the following conditions: a. AD Category . for the relevant export have been surrendered.I banks are required to: i. iii. ensure that all procedures as applicable to normal imports are adhered to. iv.S.I banks may allow payment of commission by Indian exporters.I banks may permit payment of commission in free foreign exchange upto 10 percent of invoice value. Annex-1 BEF (Statement showing the details of remittances effected towards import in respect of which documentary evidence has not been received despite reminders) Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. obtain an undertaking from the exporter that the goods will be re-imported within three months from the date of remittance. may consider requests for refund of export proceeds of goods exported from India and being re-imported into India on account of poor quality.

they may ensure submission of Exchange Control copy of the Bill of Entry for Home consumption within a reasonable period of time. ii. and a document to the satisfaction of Authorised Dealer has been produced. which may be duly verified by the AD Category . exceeding USD 100. EEFC accounts/foreign currency accounts maintained in India and abroad.e. Cases where ‘Into Bond Bill of Entry’ has been submitted need not be reported in BEF statement. Hyderabad 77 . irrespective of the source of funding (i..) vi. including advance payments. purpose of remittance was as import and subsequently the exchange has been used for other purpose for which sale of exchange is permissible. v.000 or its equivalent should only be included in the statement. at the time of advance remittance. Details of transactions where the amount of remittance exceeds USD 100. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. However.I bank and accepted as final evidence of import. Name of Controlling Office of AD branch …………….I banks may accept ‘Into Bond Bill of Entry’ as a provisional evidence of import into India. iv. foreign investments in the shares of importers etc. In cases where. In case no transaction is required to be reported. to the Regional Office of Reserve Bank under whose jurisdiction the A. payments out of external commercial borrowings. branch is functioning. ‘NIL’ statement should be submitted. The cases reported in Part I of statement for the previous half-year should not be reported again in Part I of the statement for the current half-year. delayed payments. AD Category .I banks may advise importer to submit a photocopy of the "ex-Bond Bill of Entry" for home consumption after clearance of the goods from the warehouse / bond. Statement for the half-year ended ………………… NOTES: i. The statement should include details of all remittances. AD Category . vii.Name and address of AD branch……………………. such cases should not be treated as default and hence be excluded from the BEF statement. Where EDI system has been implemented by customs and the importer receives only one copy of the "ex-Bond Bill of Entry" from the customs. iii.000 from India or payments from abroad in connection with imports. etc. The statement should be submitted in duplicate.D.

Import by Public Sector Undertakings/Government Departments 1 2 3 4 5 Etc Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Importer/ Name Exporter and Code No.No.and description remittance/ and equivdate of of goods payment amount alent import licences. address of the Importer Brief Date of Currency Rupee No. Hyderabad 78 . Part I Information regarding importers who have defaulted in submission of the documentary evidence of import Sr.viii. Statement should be submitted within 15 days from the close of the half-year to which it relates. Import by parties other than Public Sector Undertakings/Government Departments 1 2 3 4 Etc B. if any Remarks 1 2 3 4 5 6 7 8 9 A.

Name and Period of the Date of Amount of remittance address of BEF statement receipt Currency & Rupee the importer and serial No. We certify that the particulars furnished above are true and correct as per our records. iii.Part II Information regarding subsequent receipt of documentary evidence of Import from importers whose names were reported in Part I of earlier BEF statement/s Sr. Hyderabad : 79 . We undertake to continue to pursue the cases with the importers reported in Part I of the statement. Import by Public Sector Undertakings/Government Departments Note: The transactions reported in Part II of BEF statement of earlier half-year should not be repeated in Part II of the current half-year. (Signature of the Official) Name: Designation : Place: Date: Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. We further certify that the statement includes all cases which are required to be reported under the prescribed procedure. Amount equivalent of the transaction reported earlier in Part I of BEF statement Remarks 1 2 3 4 5 6 A. CERTIFICATE i. ii.No. Import by parties other than Public Sector Undertakings/Government Departments 1 2 3 4 Etc B.

Agency/ Bank (Rs. 2004] Statement of Gold Imported during the month ended ………. Crore) EOU/SEZ Nom. Full details of transactions may be provided in cases where the number of transactions in respect of a single importer exceeds ten transactions in a month or the aggregate value of imports exceeds US Dollar 50 million.2 dated July 9. Name of the Bank : Date of Statement : Number of Transactions EOU/SEZ Nom.(DIR Series) Circular No.P. Details of EOUs/Units in SEZ and Nominated Agencies should be given separately. Hyderabad 80 .Agency /Bank Gold (i) Delivery Against Payment Basis (ii) Suppliers’ Credit Basis (iii) Consignment Basis (iv) Unfixed Price Basis Note: 1. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. 2.Annex-2 [A.Agency/ Bank Value of Gold Imported (USD million) EOU/SEZ Nom.

GR. Hyderabad 81 . No. No. & Kind of Pkgs. Container Nos. Country of Destination No. Consignee fg Export Trade Control If export under: Deferred Credit Joint Venture Rupee Credit Others RBI’s Approval/Cir. SDF. No. Marks & No. & Date Custom House Agent Pre-Carriage by L/C. Exchange Rate u/s 14 of CA Currency of invoice Quantity Value FOB Statistical Code & Description of Goods Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Port of Loading Nature CIF of contract Type of shipment : Outright Sale Consignment Export Others (Specify) /C&F /FOB Vessel/Flight No. Place of Receipt by Pre-Carrier Rotation No. Net Weight Gross Weight Total FOB value (in words) Analysis of Export value FOB Value Freight Insurance Commission Rate Discount Other Deductions Amount Currency Currency Amount Full export value or where not ascertainable. No. the value which exporter expects to receive on the sale of goods. & Date Importer-Exporter Code No. Other (Specify) Port of Discharge S.PP and SOFTEX Forms EXCHANGE CONTROL DECLARATION (GR) FORM NO. Annex-3 ORIGINAL Exporter Invoice No. & Date Q/Cert. & Date AR4/AR4A No. & Date SB No.

having regard to the prevailing market conditions. name of advising bank in India Yes No For customs Customs Assessable value Rs. the date of delivery must be within fifteen months.EXCHANGE CONTROL DECLARATION (GR) FORM NO. but for exports to warehouses established outside India with the permission of the Reserve Bank. in the manner specified in the Regulations under the Act. *Strike out whichever is not applicable SPACE FOR USE BY RESERVE BANK OF INDIA Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Is Export under L/C arrangements? If yes. Hyderabad 82 . I/we further declare that I/we am/are resident in India and I/we have a place of business in India. 1999: I/We hereby declare that I/we am/are the Seller/Consignor of the goods in respect of which this declaration is made and that the particulars given above are true and that (a) *the value as contracted with the buyer is the same as the full export value declared overleaf/ (b) *the full export value of the goods is not ascertainable at the time of export and that the value declared is that which I/we. Dat e (Signature of Exporter) @ State appropriate date of delivery which must be within six months from the date of shipment. expect to receive on the sale of goods in the overseas market. I/We* am/are OR am/are not in Caution List of the Reserve Bank of India. (Rupees) Bank through which payment is to be received Export value Verified Customs Appraiser Whether payment is to be received through the ACU Yes/No Date Shipment of Customs Appraiser Declaration under Foreign Exchange Management Act. I/We undertake that I/we will deliver to the bank named herein the foreign exchange representing the full export value of the goods on or before @.

& Date Consignee Export Trade Control If export under: Deferred Credit Joint Venture Rupee Credit Others RBI’s Approval/Cir. & Date AR4/AR4A No.EXCHANGE CONTROL DECLARATION (GR) FORM NO. & Kind of Pkgs. For customs Is Export under L/C Yes No arrangements? If yes. name of advising bank in India Customs Assessable value Rs. Marks & No. No. Country of Destination No. Net Weight Gross Weight Total FOB value (in words) Analysis of Export value Currenc y Amount Full export value or where not ascertainable. Port of Loading Nature CIF of contract Others (Specify) /C&F /FO B Other (Specify) Port of Discharge S. No. Container Nos. Hyderabad Amount Currency 83 . Rotation No. (Rupees) Bank through which payment is to be received Export value Verified Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. the value which exporter expects to receive on the sale of goods. Exchange Rate u/s 14 of CA Currency of invoice Quantity Value FOB Statistical Code & Description of Goods FOB Value Freight Insurance Commission Rate Discount Other Deductions EXCHANGE CONTROL DECLARATION (GR) FORM NO. & Date Custom Agent House L/C. & Date Importer-Exporter Code No. Pre-Carriage by Place of Receipt by Pre-Carrier Type of shipment : Outright Sale Consignment Export Vessel/Flight No. No. & Date Q/Cert. SB No. No. Duplicate Exporter Invoice No.

*Strike out whichever is not applicable FOR AUTHORISED DEALER’S USE Uniform Number Code *Indicate ( ) in the box applicable Date of *(i) negotiation Type of Bill* (i) DA (ii) DP (ii) receipt collection. for Bill No (iii) Others (Specify) (ii) Consignment Basis Type of shipment : *(i) Firm Sale Contract (iii) Others (Specify) The GR Form was included in the statement sent to the Reserve Bank with the R Return for the fortnight ending . I/We* am/are OR am/are not in Caution List of the Reserve Bank of India. but for exports to warehouses established outside India with the permission of the Reserve Bank. having regard to the prevailing market conditions. Hyderabad 84 . the date of delivery must be within fifteen months. in the manner specified in the Regulations made under the Act.. 1999: I/We hereby declare that I/we am/are the Seller/Consignor of the goods in respect of which this declaration is made and that the particulars given above are true and that (a) *the value as contracted with the buyer is the same as the full export value declared overleaf/ (b) *the full export value of the goods is not ascertainable at the time of export and that the value declared is that which I/we. expect to receive on the sale of goods in the overseas market. Date of receipt Currency Credit to Nostro Account in Country In our name (1) (2) (3) In the name of* (4) (Currency) Debit to NR Rupee Account of a Bank in country Held with us (5) Held with* (6) (amount) as Period of R Return with which the realisation has been reported to RBI (7) *(Write the name of the concerned Indian Authorised Dealer Branch) Any other manner of receipt (Specify) (Stamp & Signature of Authorised Dealer) Address : SPACE FOR USE BY RESERVE BANK OF INDIA Date : Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Dat e (Signature of Exporter) @ State appropriate date of delivery which must be within six months from the date of shipment.Customs Appraiser Cargo shipped in full/part Quantity Value Whether payment is to be received through the ACU Yes/No Date Shipment of Customs Appraiser Declaration under Foreign Exchange Management Act. I/We undertake that I/we will deliver to the bank named herein the foreign exchange representing the full export value of the goods on or before @. I/we further declare that I/we am/are resident in India and I/we have a place of business in India. sent on … We certify and confirm that we have received the total amount of under being the proceeds of exports declared on this form.

The foreign exchange representing the full export value of the goods on or before @ in the manner specified in the Regulations made under the Foreign Exchange Management Act. having regard to the prevailing market conditions. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. *Strike out whichever is not applicable. I/We* am/are OR am/are not in Caution List of the Reserve Bank of India. Act. expect to receive on the sale of goods in the overseas market. Date : Declaration under Foreign Exchange Management. Hyderabad 85 . I/We undertake that I/We will deliver to the bank named herein . Date: (Signature of Exporter) @ State appropriate date of delivery which must be within six months from the date of shipment but for exports to warehouses established outside India with permission of the Reserve Bank. dated are true and that (a) *the value as contracted with the buyer is the same as the full export value declared in the above shipping bill (b) *the full export value of the goods is not ascertainable at the time of export and that the value declared is that which I/We. I/We further declare that I/We am/are resident in India and I/We have a place of business in India. the date of delivery must be within fifteen months. 1999. 1999 : I/We hereby declare that I/We am/are the *Seller/Consignor of the goods in respect of which this declaration is made and that the particulars given in the Shipping Bill No.SDF [In duplicate] Shipping Bill No.

. Hyderabad 86 .. sent on …... (i) DA (ii) DP (iii) Others (ii) Consignment Basis (Specify) (Specify) *Type of Bill *Types of shipment (i) Firm Sale Contract (iii) Others *Indicate ( ) in the box applicable The SDF Form was included in the Statement sent to Reserve Bank with the R Return for the fortnight ending …............ We certify and confirm that we have received the total amount of (Currency amount) as under being the proceeds of exports declared on this form.FOR AUTHORISED DEALER’S USE Uniform Code Number Date of (i) (ii) (iii) ...........Country Debit to NR Rupee Account of a Bank in.. Date of receipt Currenc y Credit to Nostro Account in.... country Held with us (5) Held with** (6) (7) Period of R Return with which the realisation has been reported to RBI (1) (2) In our name (3) In the name of** (4) **(Write the name of the concerned Indian Authorised Dealer Branch) Any other manner of receipt (Specify) (Stamp & Signature of Authorised Dealer) Date : Address : SPACE FOR USE BY RESERVE BANK OF INDIA Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.... negotiation receipt for collection Bill No. .

Country of destination 6.. Description of goods : Quantity of goods : Unit† .. 11. .. 7..... 13. Analysis of export value : Particulars Currency (for RBI use) Amount @Full Export value F.... Exporter’s Name 3... Metre/Metre/Number/Others (Specify)] . Number and date of its approval State Bank Staff College.. Importer/Exporter Code No. Customs Assessable Value (Rupees) If the export is made under general permission of the Reserve Bank of India. Type of Shipment*(i) Outright Sale/(ii) Consignment export/(iii) Others (Specify) .Quantity 10..B.O. 9. Value Freight Insurance Discount (Rate.FORM PP Exporter’s Declaration ORIGINAL Form Number : (Please see ‘Notes to Exporters’) 1. @ Where the full export value is not ascertainable value expected on sale of goods in the oversease market may be shown No application for permission for remittance/deduction from the declared value on account of agency commission and/or discount will be entertained by the Reserve Bank or Authorised Dealer unless these have been declared on this form 12.) Agency Commission (Rate. Buyer’s/Consignee’s Name and address: 5. Nature of contract*(i) CIF/(ii) C&F/(iii)FOB/ (iv) Others (Specify): .. Hyderabad Handbook on FEMA regulations – Imports and Exports Feb’09 87 . 4. ..... 8.) (For Customs Use) Export Value verified (Customs Appraiser) 14.. (a) Name of the Post Office (b) Number and date of Parcel Receipt 2. Currency of Invoice [†Ton/Kilogram/Litre/Cubic Metre/ Sq. Date of despatch .

having regard to the prevailing market conditions. I/We further declare that I/we am/are resident in India and I/we have a place of business in India. 17.’s use) (Signature of Exporter) Stamp & Signature of Authorised Dealer Date : Bank’s Uniform Code No. All documents relating to export of goods from India must be passed through the medium of an Authorised Dealer in foreign exchange in India within 21 days of the date of shipment of the goods. Notes to Exporters (1) (2) (3) Date: Address : (4) (5) Note : This Form should not be pasted on the Parcel. SPACE FOR USE BY RESERVE BANK OF INDIA Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. If the export is made under L/C arrangements. Reserve Bank will advise Authorised Dealers of such arrangements by issue of circulars. I/We undertake that I/we will deliver to the bank named above the foreign exchange representing the full export value of the goods on or before† in the manner prescribed in the Regulations made under Foreign Exchange Management Act 1999.15. I/We* am/are not in the Caution List of the Reserve Bank of India. The Post Office through which the goods have been despatched will forward the Original to the nearest office of Reserve Bank of India. Hyderabad 88 .D. The Original should be submitted by the exporter to the Post Office after having it countersigned by an Authorised Dealer in foreign exchange. †State approximate date of delivery which must be within six months from the date of shipment. The PP Form should be completed in duplicate in all cases. (For A. name of advising bank in India State if the payment is to be received through the Asian Clearing Union: *Yes/No Name & address of bank through whom payment is to be received I/We hereby declare that I/we am/are the *SELLER/CONSIGNOR of the goods in respect of which the declaration is made and that the particulars given above are true and that *(a) the export value as contracted with the buyer is the same as the full export value declared above/*(b) the full export value of goods is not ascertainable at the time of export and that the value declared is that which I/we. *Strike out whichever is not applicable. The amount representing the full export value of goods must be realised within six months from the date of shipment. The PP Form procedure applies to postal exports to all territories outside India excluding Nepal and Bhutan. Government of India/Indian Financial institutions may conclude from time to time Special Trade Agreements with other countries providing for settlement of certain payments from the countries in a specified manner or for exports to be financed from Government to Government Credits. expect to receive on the sale of goods in the overseas market. 16. Methods of payment specified in the individual arrangements will have to be followed in such cases.

....) Agency Commission (Rate ) (For Customs Use) Export Value verified (Customs Appraiser) 14. Date of despatch ... Buyer’s/Consignee’s Name and address: Country of destination Nature of contract*(i) CIF/(ii) C&F/(iii)FOB/ (iv) Others (Specify): . Metre/Metre/Number/Others (Specify)] . 4... Customs Assessable Value (Rupees) 15. (a) Name of the Post Office (b) Number and date of Parcel Receipt 2. Hyderabad Handbook on FEMA regulations – Imports and Exports Feb’09 89 . Value Freight Insurance Discount (Rate.. 6. 5..B. name of advising bank in India State Bank Staff College.. Type of Shipment*(i) Outright Sale/(ii) Consignment export/(iii) Others (Specify) .. 11. Analysis of export value : Particulars Currency (for RBI use) 9.. If the export is made under general permission of the Reserve Bank of India. Exporter’s Name Importer/Exporter Code No.. 3. ..O.. Number and date of its approval If the export is made under L/C arrangements.. Description of goods : Quantity of goods : Unit† . 10. 7..Quantity Currency of Invoice [†Ton/Kilogram/Litre/Cubic Metre/ Sq.FORM PP Exporter’s Declaration DUPLICATE Form Number : 1. 13. 8.. @ Amount @Full Export value F. Where the full export value is not ascertainable value expected on sale of goods in the oversease market may be shown No application for permission for remittance/deduction from the declared value on account of agency commission and/or discount will be entertained by the Reserve Bank or Authorised Dealer unless these have been declared on this form 12.

(For A. †State approximate date of delivery which must be within six months from the date of shipment.’s use) (Signature of Exporter) Stamp & Signature Date: of Authorised Dealer Date Address : : Bank’s Uniform Code No. State if the payment is to be received through the Asian Clearing Union: *Yes/No Name & address of bank through whom payment is to be received I/We hereby declare that I/we am/are the *SELLER/CONSIGNOR of the goods in respect of which the declaration is made and that the particulars given above are true and that *(a) the export value as contracted with the buyer is the same as the full export value declared above/*(b) the full export value of goods is not ascertainable at the time of export and that the value declared is that which I/we. *Strike out whichever is not applicable. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. I/We* am/are not in the Caution List of the Reserve Bank of India. Hyderabad 90 . I/We undertake that I/we will deliver to the bank named above the foreign exchange representing the full export value of the goods on or before† in the manner specified in Regulations made under the Foreign Exchange Management Act 1999. Type of Bill *DA/(ii)DP/ (iii) Others Type of shipment : *(i) Firm Sale Contract/ (ii) Consignment Basis/ (iii) Others (Specify) The PP Form was included in the Statement sent to the Reserve Bank with the R Return for the fortnight ending sent on We certify and confirm that we have received the total amount of (Currency) (Amount) as under being the proceeds of exports declared on this form. expect to receive on the sale of goods in the overseas market.16. Note : All documents relating to export of goods from India must be passed through the medium of an Authorised Dealer in foreign exchange in India within 21 days of the date of shipment of the goods.D. I/We further declare that I/we am/are resident in India and I/we have a place of business in India. having regard to the prevailing market conditions. Date of *(i) negotiation/(ii) receipt for collection * Strike out whichever is not applicable Bill No. FOR AUTHORISED DEALER’S USE Uniform Code Number : . 17.

Date of Receipt Currency Credit to Nostro Account in (Country) Debit to NR Rupee Account of a bank in (country) Period of R Return with which the realisation has been reported to RBI 7 In our name 1 2 3 In the name of† 4 Held with us 5 Held with† 6 († Write the name of the concerned Indian Authorised Dealer branch). please indicate the authority conferred on the Authorised Dealers by or under the Exchange Control Manual or the Authorised Dealer’s Circular or Circulars. Any other manner of receipt (specify) . or the Reserve Bank of India’s approval number and date for reduction. Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Hyderabad 91 . (Stamp & Signature of Authorised Dealer) Date : Address : Notes to Authorised Dealer : 1. In case the net amount received falls short of the full export value declared on the Form for reasons other than deduction of bank charges. . as the case may be. Please ensure that the columns on the face of the PP Form have been completed by the exporter and that they have been duly authenticated by the Postal authorities wherever necessary. 2.

Hyderabad 92 . Yes No b) Type of software exported (Please mark on the appropriate box on the left side).A (For exports through data communication link) 8. Name and address of the exporter STPI Centre within whose jurisdiction the unit is situated Import-Export Code Number Category of exporter Buyer’s name and address including country and their relationship with exporting unit (if any) Date and Number of Invoice a) Whether export contract/ purchase order already registered with STPI. 5. 6. 2. (If ‘No’.SOFTWARE EXPORT DECLARATION (SOFTEX) FORM (For declaration of Software Exports through data-communication links and receipt of Royalty on the Software Packages/Products exported) FORM NO: AB ORIGINAL ___________________________________________________________________ 1. Name of Authorised datacom service provider STPI/VSNL/DOT/Internet/Others (Please specify) No : STP/EHTP/EPZ/SEZ/100% EOU/DTA unit 3. 9. 7. please attach copy of the contract/purchase order) Does contract stipulate payment of royalty Yes SECTION . (a) Computer Software Data Entry jobs and Conversion Software Data Processing Software Development Software Product. 4. Packages Others (Please specify) RBI Code 9 9 9 9 0 0 0 0 6 7 8 9 Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.

advance payment..B (For receipt of Royalty on Software Packages/Products exported) 12. on which exports were declared Royalty agreement details %age and amount of royalty Period of royalty agreement (Enclose copy of Royalty agreement. at the rate of ...(c+d)] 11. __________ SECTION . if not already registered) 13. How royalty value will be realised (as defined in Royalty agreement) Calculation of royalty amount __________________________________ ___________________________________ ___________________________________ ___________________________________ (c) ___________________________________ ___________________________________ State Bank Staff College. How export value will be realised (mode of realisation) (Please mark on the appropriate box) (a) Under L/C (a) Name and address of ________________ Authorised Dealer (b) Authorised Dealer Code No. 14. etc...% Any other deductions as permitted by RBI (please specify) Amount to be realised [(a+b) . Details of Software Package(s)/ Product(s) exported (a) Date of export (b) GR/SDF/PP/SOFTEX Form No. Hyderabad Handbook on FEMA regulations – Imports and Exports Feb’09 93 . __________ (c) Any other arrangement e. Analysis of Export Value (a) Full export value of which :i) Net value of exports without transmission charges ii) (b) (c) (d) (e) Transmission charges included in invoice Transmission charges (if payable separately by the overseas client) Deduct: Agency commission. __________ (b) Bank Guarantee (a) Name and address of ________________ Authorised Dealer (b) Authorised Dealer Code No. including transfer/remittance to bank account maintained overseas (Please specify) (a) Name and address of ________________ Authorised Dealer (b) Authorised Dealer Code No..g.(b) Other Software Video/TV Software Others (Please specify) 9 9 Currency 1 1 0 1 Amount 10.

.. STPI/EPZ/SEZ) on behalf of Ministry of Information Technology Certified that the software described above was actually transmitted and the export/royalty value declared by the exporter has been found to be in order and accepted by us.. within six months from the date of invoice/date of last invoice raised during a month).e.. Place: Date: Designation: _________________________ ================================================================================== Enclosure: (1) Copy of Export Contract [7(a)] (2) Copy of Royalty Agreement [12(c)] (3) Copy of communication from foreign customer [14] ================================================================================== ____________________________ Signature of the Exporter Name: ______________________________ Stamp Space for use of the competent authority (i....... Name and address of designated Authorised ___________________________________ Dealer in India through whom payment has been received/to be received SECTION -C A..D. (i.... Code No.. I/we also declare that the software has been developed and exported by using authorised and legitimate datacom links. _______________________ 16... in the manner specified in the Regulations made under the Foreign Exchange Management Act.e...... Declaration by exporter I/We hereby declare that I/we am/are the seller of the software in respect of which this declaration is made and that the particulars given above are true and that the value to be received from the buyer represents the export value contracted and declared above. 1999.. Hyderabad 94 .(Enclose copy of communication from the foreign customer) 15. I/We undertake that I/we will deliver to the bank named above the foreign exchange representing the full value of the software exported as above on or before .. Place: Date: Stamp _________________________________________ (Signature of Designated Official of STPI/EPZ/SEZ on behalf of Ministry of Information Technology) Name: _______________________________________ Designation: __________________________________ Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.

A (For exports through data communication link) No 6. STPI Centre within whose jurisdiction the unit is situated Import-Export Code Number Category of exporter : STP/EHTP/EPZ/SEZ/100% EOU/DTA unit 3.SOFTWARE EXPORT DECLARATION (SOFTEX) FORM (For declaration of Software Exports through data-communication links and receipt of Royalty on the Software Packages/Products exported) FORM NO: AB DUPLICATE _________________________________________________________________________________ 1. Hyderabad 95 . (a) Computer Software Data Entry jobs and Conversion Software Data Processing Software Development Software Product. please attach copy of the contract/purchase order) Does contract stipulate payment of royalty Yes SECTION . Buyer’s name and address including country and their relationship with exporting unit (if any) Date and Number of Invoice a) Whether export contract/ purchase order already registered with STPI. 5. 7. 4. Name and address of the exporter 2. Packages Others (Please specify) RBI Code 9 9 9 9 0 0 0 0 6 7 8 9 Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Yes No b) 8. (If ‘No’. Name of Authorised datacom service provider STPI/VSNL/DOT/Internet/Others (Please specify) Type of software exported (Please mark on the appropriate box on the left side). 9.

How royalty value will be realised (as defined in Royalty agreement) ___________________________________ Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. ________________ (b) Bank Guarantee (a) Name and address of ______________________ Authorised Dealer ______________________ (b) Authorised Dealer Code No. advance payment. etc. Analysis of Export Value (a) Full export value Of which :i) Net value of exports without transmission charges ii) (b) (c) (d) (e) Transmission charges included in invoice Transmission charges (if payable separately by the overseas client) Deduct: Agency commission..g..B (For receipt of Royalty on Software Packages/Products exported) 12.. Hyderabad 96 . ________________ (c) Any other arrangement (a) Name and address of ______________________ e. on which exports were declared Royalty agreement details %age and amount of royalty Period of royalty agreement (Enclose copy of Royalty agreement... if not already registered) ___________________________________ ___________________________________ ___________________________________ ___________________________________ 13.% Any other deductions as permitted by RBI (please specify) Amount to be realised [(a+b) . Authorised Dealer ______________________ including transfer/remittance to bank account maintained (b) Authorised Dealer Code No. Details of Software Package(s)/ Product(s) exported (a) (b) (c) Date of export GR/SDF/PP/SOFTEX Form No.(c+d)] 11. at the rate of .(b) Other Software Video/TV Software Others (Please specify) 9 9 Currency 1 1 0 1 Amount 10. How export value will be realised (mode of realisation) (Please mark on the appropriate box) (a) Under L/C (a) Name and address of ______________________ Authorised Dealer _______________________ (b) Authorised Dealer Code No. ________________ overseas (Please specify) SECTION ..

. _______________________ 16. I/we also declare that the software has been developed and exported by using authorised and legitimate datacom links... within six months from the date of invoice/date of last invoice raised during a month). (i. A... 1999. in the manner specified in the Regulations made under the Foreign Exchange Management Act.e.. Hyderabad 97 .. I/We undertake that I/we will deliver to the bank named above the foreign exchange representing the full value of the software exported as above on or before . Place: _________________________________________ Date: STPI/EPZ/SEZ Stamp (Signature of Designated Official of Stamp on behalf of Ministry of Information Technology) Name: _________________________________ Designation: ____________________________ Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Calculation of royalty amount (Enclose copy of communication from the foreign customer) Name and address of designated Authorised ___________________________________ Dealer in India through whom payment has been received/to be received SECTION -C ___________________________________ 15..D. STPI/EPZ/SEZ) on behalf of Ministry of Information Technology Certified that the software described above was actually transmitted and the export/royalty value declared by the exporter has been found to be in order and accepted by us............14. Code No....e. Place: Date: _______________________________ Signature of the Exporter Name: ________________________________ Designation: ___________________________ ========================================================================== Enclosure: (1) Copy of Export Contract [7(a)] (2) Copy of Royalty Agreement [12(c)] (3) Copy of communication from foreign customer [14] =========================================================================== Space for use of the competent authority (i. Declaration by exporter I/We hereby declare that I/we am/are the seller of the software in respect of which this declaration is made and that the particulars given above are true and that the value to be received from the buyer represents the export value contracted and declared above...

.................................... The SOFTEX Form included in the ENC statement sent to the Reserve Bank with the ‘R’ Return (NOSTRO/VOSTRO) ..... ............................................... Date of Receipt Currency Credit to Nostro Account in ........................................................................................ (Currency) (Amount) proceeds of exports declared on this form...For Authorised Dealer’s use only Certificate by Authorised dealer AD’s Uniform Code No.................................... (Country) In our name 1 2 3 In the name of ** 4 Debit to Non-Resident Rupee Account of a bank in ....................... (country) Held with Held with us ** 5 6 as under being the Period of R-Return with which the realisation has been reported to RBI 7 (** Write the name of the concerned branch of Authorised Dealer) Any other manner of receipt (Specify) ....... Hyderabad 98 .. for the period ending .............. Place:____________ Date:____________ Stamp ___________________________ (Signature of Authorised Official) Name: ____________________________________ Designation : _______________________________ Name & Address of__________________________ Authorised Dealer ___________________________ Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.................. sent on (Currency name) We certify and confirm that we have received the total amount of.

Hyderabad 99 . Name and address of the exporter 2.SOFTWARE EXPORT DECLARATION (SOFTEX) FORM (For declaration of Software Exports through data-communication links and receipt of Royalty on the Software Packages/Products exported) FORM NO: AB TRIPLICATE _____________________________________________________________________________________ 1. (a) Computer Software Data Entry jobs and Conversion Software Data Processing Software Development Software Product. Name of Authorised datacom service provider STPI/VSNL/DOT/Internet/Others (Please specify) No : STP/EHTP/EPZ/SEZ/100% EOU/DTA unit 3.A (For exports through data communication link) 8. STPI Centre within whose jurisdiction the unit is situated Import-Export Code Number Category of exporter Buyer’s name and address including country and their relationship with exporting unit (if any) Date and Number of Invoice a) Whether export contract/ purchase order already registered with STPI. Packages Others (Please specify) RBI Code 9 9 9 9 0 0 0 0 6 7 8 9 Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Type of software exported (Please mark on the appropriate box on the left side). 5. 4. 6. 7. (If ‘No’. please attach copy of the contract/purchase order) Does contract stipulate payment of royalty Yes SECTION . Yes No b) 9.

. How export value will be realised (mode of realisation) (Please mark on the appropriate box) (a) Under L/C (a) Name and address of ______________________ Authorised Dealer ______________________ (b) Authorised Dealer Code No. Details of Software Package(s)/ Product(s) exported (a) Date of export (b) (c) GR/SDF/PP/SOFTEX Form No.g. Hyderabad 100 .(b) Other Software Video/TV Software Others (Please specify) 9 9 Currency 1 1 0 1 Amount 10. ________________ (b) Bank Guarantee (a) Name and address of ______________________ Authorised Dealer ______________________ (b) Authorised Dealer Code No. etc.. advance payment. on which exports were declared Royalty agreement details %age and amount of royalty Period of royalty agreement (Enclose copy of Royalty agreement.. including transfer/remittance to bank account maintained overseas (Please specify) (a) Name and address of ___ ___________________ Authorised Dealer ______________________ (b) Authorised Dealer Code No. ________________ (c) Any other arrangement e.. at the rate of .(c+d)] 11.. Analysis of Export Value (a) Full export value Of which :i) Net value of exports without transmission charges ii) (b) (c) (d) (e) Transmission charges included in invoice Transmission charges (if payable separately by the overseas client) Deduct: Agency commission.B (For receipt of Royalty on Software Packages/Products exported) 12. How royalty value will be realised (as defined in Royalty agreement) ___________________________________ Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. ________________ SECTION .% Any other deductions as permitted by RBI (please specify) Amount to be realised [(a+b) .. if not already registered) ___________________________________ ___________________________________ ___________________________________ ___________________________________ 13.

(i.. within six months from the date of invoice/date of last invoice raised during a month).... _____________________________ Signature of the Exporter Name: ________________________ Designation: ___________________ =========================================================================== Enclosure: (1) Copy of Export Contract [7(a)] (2) Copy of Royalty Agreement [12(c)] (3) Copy of communication from foreign customer [14] ========================================================================== Space for use of the competent authority (i.. Code No..e... 1999.D... Place: Date: STPI/EPZ/SEZ Stamp ___________________________________ (Signature of Designated Official of on behalf of Ministry of Information Technology) Name: _________________________________ Designation: ____________________________ Place: Date: Stamp Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.14.. specified in the Regulations made under the Foreign Exchange Management Act..e.. I/we also declare that the software has been developed and exported by using authorised and legitimate datacom links. STPI/EPZ/SEZ) on behalf of Ministry of Information Technology Certified that the software described above was actually transmitted and the export/royalty value declared by the exporter has been found to be in order and accepted by us..... _______________________ 16. I/We undertake that I/we will deliver to the bank named above the foreign exchange representing the full value of the software exported as above on or before ... Calculation of royalty amount (Enclose copy of communication from the foreign customer) Name and address of designated Authorised ___________________________________ Dealer in India through whom payment has been received/to be received SECTION -C ___________________________________ 15. A... Hyderabad 101 .. Declaration by exporter I/We hereby declare that I/we am/are the seller of the software in respect of which this declaration is made and that the particulars given above are true and that the value to be received from the buyer represents the export value contracted and declared above...

No . Date of export 5. GR/PP/ SOFTE X form No. Invoice value Currency and Amount 12. 11. Amount Outstanding Currency and Amount 14. Remarks 18. Name & address of the overseas buyer 10. D. and date 2. and date 9. Amount Realised Currency and Amount 13. Bill No. Due date of realisation 6. Port of Shipment Shipping bill No. 4. 16. 1. Commodit y 8. Rupee equivalent of outstanding amount (To be classified as) Cash exports Exports on Undrawn balances consignment basis 15. ___________________________________________________________________ Total ___________________________________________________________________ Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Hyderabad 102 . 7./ IE Code No. 17. Exporter’s Code No.Annex-4 XOS A. Name & Address of exporter 3. Code No…………… Statement of particulars of export bills outstanding beyond prescribed period/ due date of realisation as at 30th June/ 31st December Part I – Outstanding export bills other than those on deferred payment terms Sr.

Part II – Exports on deferred payment terms where instalments (including interest) are outstanding beyond due date
Sr. No. Name & address of exporter 2. Exporter’s Code No./ IE Code No. 3. No. & date of RBI approval for deferred payment term 4. Date of export GR Form No. Port of Shipment Shipping bill No. and date Name & address of the overseas buyer 9. Commodity Invoice value Currency & Amount 10. 11.

1.

5.

6.

7.

8.

Value of goods covered under deferred payment terms(including interest) Currency Amount 12.

Total Amount of deferred instalments (including interest) already received Currency 13. Amount

Total Amount of instalments outstanding (including interest) beyond due date Currency 14. Amount

Rupee equivalent of outstanding amount

Whether ECGC cover obtained (Yes /No)

No. & date of bank certificate issued

Remarks

15.

16.

17.

18.

___________________________________________________________________
Total

___________________________________________________________________

Handbook on FEMA regulations – Imports and Exports Feb’09

State Bank Staff College, Hyderabad

103

Part III

:

Summary Part I Part II
Total Rs. Exports on deferred payment basis Rs.

'Cash' exports Rs.

Export on consignment basis Rs.

Undrawn balances Rs.

Outstandings as on _______________ (End of previous half-year) Add: Addition during the half- year under report Less: Deletion during the half-year

Net position of outstanding as on ______________ (End of half-year under report)

We certify that all export bills i.e. export bills purchased, negotiated and sent for collection, outstanding beyond the prescribed period / due date of realisation of as at the end of half-year under report have been included in this statement.

Place: ___________________ Stamp Date : ___________________

(Signature of Authorised Official) Name: ______________________ Designation: _________________

Handbook on FEMA regulations – Imports and Exports Feb’09

State Bank Staff College, Hyderabad

104

Annex- 5 (Self write-off and extension of time )
(PART A) Annual statement to be furnished to Authorised Dealers by exporters giving details of export performance during a calendar year as on 31 Dec….. (Amount in Rs 000s) Total Export Proceeds Due within the Prescribed period of 180 days or higher period as applicable No.of GR/SOFTEX/ SDF/PP forms due Amount Total Export Proceeds realised within the prescribed period of 180 days or higher period as applicable No.of GR/SOFTEX/ SDF/PP forms Fully Realised Partly Realised (PART B) (Amount in Rs 000s)
Details of Export Bills not Realised (partly or fully) within the prescsribed period Details of Extension / Reduction in invoice value/ Write off by the Exporter himself Amount Revised due date @ (2)

Export proceeds not realised within the Prescribed period of 180 days or higher period as applicable No.of GR/SOFTEX/ SDF/PP forms Amount

Amount

Extension/ Reduction in invoice value / Write off sought from AD Amount (3) Revised due date @

GR/SOFTEX/ SDF/PP No. (1) Total

Amount

NOTE : 1) The exporter should approach AD/RBI for extension of time in respect of bills in Column (3) in PART B. 2) Total of Bills in Column (2) in Part B should not exceed 10% of those in Column 1 of PART A 3) From 2005 onwards Bills in Column 1 of PART A will include those which have been extended for realisation by the exporter himself or with the approval of AD/RBI. 4) In respect of export bills written off (including reduction in invoice value) evidence for surrender of export incentives to be enclosed. @ For cases of extension

Exporters Signature :

Verified by Authorised Dealer

Handbook on FEMA regulations – Imports and Exports Feb’09

State Bank Staff College, Hyderabad

105

BHP Billiton. Name of the AD Category – I Bank : AD Code (12 digit) : Sl. Australia 4. Ltd. Angola ALROSA. GOKHARAN. 3. P. Russia Signature of the authorised official of the bank : Date : Stamp : Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. No. ENDIAMA E. Hyderabad 106 . UK 2. Name of the Company Name of the Amount of Advance Whether document for Importer Entity Payment made evidence of import and IEC No.. Diamond Trading Company Pvt. without BG / Standby submitted LC 1.6 Statement of Advance Remittance without bank guarantee or standby letter of credit where the amount of advance is equivalent to or more than USD 5 million for import of Rough Diamonds for the period ended …………………….Annex . UK RIO TINTO.. 6. Russia 5.

87 dated April 17. (DIR Series) Circular No.inUS Interest chages D in USD 8 9 10 11 1 7 Tota l Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Lender* 2 3 4 5 6 Currency Rate of Other Amount Equiv.P.Annexure 7 Form – TC Annex to A. Amt. No Date of Loan Category of Name of Country Approv Identificatio Borrower Lender* of al n No. Hyderabad 107 . 2004 Part I : Approvals of Trade Credit granted by all branches during the (Month / Year)………… Name of the AD : Address : Contact Person: Tel : Fax : Sr.

/Yr 13 Unit of time period 14 SC / BC 15 STC / LTC 16 17 18 I. 2003 should be entered as 2003/12/31 Note 4:Data on rate of interest (col. Total Trade Credit (TC) (I+II) *: or Supplier **: Please type respective code such as SC or BC. BKG: Banking. 4) may be entered as follows: PUB: Public Sector.) Note 2: Information in column nos. Buyer's Credit (BC) III. no. Short-term Trade Credit (STC) (maturity period up to one year) IV. No 10) & all-in-cost(col no 12) should be entered as follows: 3 per cent per annum is to be typed as '3. 8 to 13 should be numeric only. Supplier's Credit (SC) II. Note 7: Codes for Category of Borrower (in Col.of days/month/year under period of credit may be entered as follows: '90' for 90 days. Note 3:Date format in col. No alphabets should be entered in those columns. STC or LTC. No 2 is YYYY/MM/DD. 2004 Part I: Approvals of Trade Credit granted by all branches during the (Month / Year)………… e-mail: Period of credit Type of Crdit** Item of Import / proposed Import Description Category*** All-incost 12 No.00' without any % sign. Note 5:In the Col. year(YY) to be entered. No 13. ***: Petroleum Oil Lubricants (POL).Form – TC Excel format Annex to A. Others (OT) Note 1: The format of the loan identification number is : TC/(Name of the Bank/branch)/(Identification No. No 14). Long-term Trade Credit (LTC) (maturity period more than one year & less than three years) V. December 31.P. PVT:Private Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Hyderabad 108 . of Days/Mon. months(MM). Note 6:In the case of unit of time period(Col. (DIR Series) Circular No. For example. Capital Goods (CG). only unit of time period such as days(DD). 87 dated April 17.

December 31. No 11. Ident Approv ment ion al ificat ed (USD) (USD) ion (USD) No. 1 2 3 4 5 6 7 Date of Other Total Outstan Shipment charges (6+7+8) ding (46) Final Repaymen t 8 9 10 11 12 Note 1: Information in column nos. utilisation and repayment of all trade credits approved by our branches have been scrutinised and it is cerified that such drawal. 12 is YYYY/MM/DD.N Loan Amount Disburse Utilisat Princip Interest o. The drawal. 3 to 10 should be numeric only. Note 2: Date format in col.Part II : Disbursement. All trade credits for imports approved by all our branches during the month-----------------.1. No alphabets should be entered in those columns. 2. Utilisation and Debt Servicing of Trade Credit during (month) / (year) Repayments (USD) Sr. Hyderabad 109 . For example. 2003 should be entered as 2003/12/31 Certificate by the Authorised Dealer 1. 3.have been included in this statement. utilisation and repayments of trade credits Place:----------------------Date: -----------------------Signature of Authorised Dealer [ Stamp] Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College. Related import documents (including EC copy of Bill of Entry) towards utilisation of such trade credits have been verified and found in order.

Hyderabad 110 .Annexure 8 Statement on LCs/Guarantees/LOU/LOC issued by AD Category I Banks As on quarter ended……………. Name of the AD Address: Email: On behalf of Residents Trade Credits (Les than 3 years) Up to one year Above one year and les than three years** ** limited to import of capital goods Place Date Signature of Authorised Dealer [ Stamp] Contact person: Tel: Fax: LCs/Guarantees/LOU/LOC issued Buyer’s Credit Supplier’s Credit Handbook on FEMA regulations – Imports and Exports Feb’09 State Bank Staff College.