What are the objectives of Foreign Exchange Management Act?

The primary objective of FEMA act was “facilitating external trade and payments and promoting the orderly development and maintenance of foreign exchange market in India”. FEMA was enacted by the Parliament of India in the winter session of 1999 to replace the Foreign Exchange Regulation Act (FERA) of 1973.

What is the definition of foreign exchange under Foreign Exchange Management Act 1999?

o the taking out of India to a place outside India any goods, o provision of services from India to any person outside India; • “foreign currency” means any currency other than Indian currency; • “foreign exchange” means foreign currency and includes,- o deposits, credits and balances payable in any foreign currency.

How many sections are in FEMA?

49 Sections
Foreign Exchange Regulation Act, 1973 (FERA) was replaced by the Foreign Management Act, 1999 (FEMA). FEMA was enacted by Parliament of India and it came into force on 1st June, 2000. There are a total of 49 Sections divided into 7 chapters.

Why is Foreign Exchange Management Act important in transaction?

In India, the Foreign Exchange Management Act (FEMA) governs foreign exchange transactions and remittance payments, and the Reserve Bank overlooks the management of the foreign market. FEMA provides a framework for the smooth functioning of border trades and developing the Indian foreign exchange market.

Why was Foreign Exchange Regulation Act created?

FERA – the four-letter acronym for Foreign Exchange Regulation Act is a codification that was introduced in 1973 with the purpose to rule the dealings in foreign exchange, enforce restrictions on specific payments and to keep an eye on the transactions impinging the foreign exchange and the import and export of …

What is the new name of FERA?

FERA was repealed in 1998 by the government of Atal Bihari Vajpayee and replaced by the Foreign Exchange Management Act, which liberalised foreign exchange controls and restrictions on foreign investment.

Who implements FEMA?

FEMA is a regulatory mechanism that enables the Reserve Bank of India to pass regulations and the Central Government to pass rules relating to foreign exchange in tune with the Foreign Trade policy of India.

What is the foreign exchange Management Act 1999?

The Foreign Exchange Management Act, 1999. An Act to consolidate and amend the law relating to foreign exchange with the objective of facilitating external trade and payments and for promoting the orderly development and maintenance of foreign exchange market in India.

What is the FEMA (foreign exchange Management Act)?

The FEMA, also referred to as the Foreign Exchange Management Act was introduced in the year 1999. The act was a replacement of the FERA or Foreign Exchange Regulation Act. FEMA came into effect on 1st of June, 2000. FEMA was passed since FERA did not meet the requirements of the policies being implemented after liberalization.

What are the objectives of foreign exchange Amendment Act?

Amendment and consolidation of foreign exchange laws and facilitating external trade and payments accounts to the main responsibilities of FEMA. It was formulated for promotion of orderly development and maintenance of foreign exchange market in India.

What is Foreign Exchange Regulation Act of India?

It is a set of regulations that empowers the Reserve Bank of India to pass regulations and enables the Government of India to pass rules relating to foreign exchange in tune with the foreign trade policy of India. Which Act did FEMA replace? FEMA replaced an act called Foreign Exchange Regulation Act (FERA).