FOREIGN EXCHANGE MANAGEMENT (EXPORT OF GOODS & SERVICES) REGULATIONS, 2015 – AN OVERVIEW
By: – DR.MARIAPPAN GOVINDARAJAN
FEMA – Foreign Exchange Management
Dated:- 11-2-2016
The Reserve Bank of India made 'Foreign Exchange (Export of Goods & Services) Regulations, 2015 ('Regulations' for short) by virtue of the powers conferred by Section 7(3)(1)(a) and Section 47 (2) of the Foreign Exchange Management Act, 1999 ('Act' for short) and in supersession of its Notification No. FEMA.23/2000-RB, dated 03.05.2000 as amended from time to time, which came into effect from 12.01.2016. The Regulations dealt with the exports, the declaration to be filed, the realization of export value etc.,
The Regulation 2(iv) defines the term 'export' as including the taking or sending out of goods by land, sea or air, on consignment or by way of sale, lease, hire purchase or under any other arrangement by whatever name called and in the case of software, also includes transmission through an
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ftware in physical form or through any other form, either directly or indirectly to any place outside India, other than Nepal and Bhutan, shall furnish to the specified authority a declaration in one of the forms EDR or SOFTEX. The declaration shall be supported by such evidence as may be specified containing true and correct material particulars including the amount representing-
* The full export value (Regulation 2(v) defines the term 'export value' in relation to export by way of lease or hire purchase or under any other similar arrangement, includes the charges, by whatever name called, payable in respect of such lease or hire purchase or any other similar arrangement) of the goods or software; or
* If the full value is not ascertainable at the time of export, the value which the exporter, having regard to the prevailing market conditions expects to receive on the sale of the goods or the software in overseas market;
* Realization of export proceeds in respect of export of g
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pects to receive on the sale of the goods in the overseas market.
Procedure
The declaration shall be executed in sets of such number as specified. Regulation 6 provides that Declaration in Form EDF shall be submitted in duplicate to the Commissioner of Customs. After duly verifying and authenticating the declaration form, the Commissioner of Customs shall forward the original declaration form/data to the nearest office of RBI and hand over the duplicate form to the exporter for being submitted to the authorized dealer.
The declaration in form SOFTEX in respect of export of computer software and audio/video/television software shall be submitted in triplicate to the designated official of Ministry of Information Technology, Government of India at the software Technology Parks of India or the Free Trade Zones or Special Economic Zones in India. After certifying ll three copies of SOFTEX form, the designated official shall forward the original directly to the nearest office of RBI and
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tral Government in this behalf or of the military, naval or air force authorities in India for military, naval or air force requirements;
* By way of gift of goods accompanied by a declaration by the exporter that they are not more than ₹ 5 lakh in value;
* Aircrafts or aircraft engines and spare parts for overhauling and/or repairs abroad subject to their reimport into India after overhauling/repairs, within a period of six months from the date of export;
* Goods imported free of cost on re-export basis;
* The following goods which are permitted by the Development Commissioner of SEX, EHTP, STP or FTZ to be re-exported, namely:
* Imported goods found defective, for the purpose of their replacement by the foreign suppliers/collaborators;
* Goods imported from foreign suppliers/collaborators on loan basis;
* Goods imported from foreign suppliers/collaborators free of cost, found surplus after production operations.
* Replacement of goods exported free of charge in
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horized dealer may accept, for negotiation or collection, shipping documents including invoice and bill of exchange covering exports, from his constituent. Before accepting such documents the authorized dealer shall-
* Where the value declared in the declaration form does not differ from the value shown in the documents being negotiated or sent for collection ; or
* Where the value declared in the declaration is less than the value shown in the documents being negotiated or sent for collection, require the constituent concerned also to sin 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 accordingly.
Realization of export value
Regulation 9 provides that the amount representing t
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e payment therefor has not been made, the RBI may give to any person who had sold the goods or who is entitled to sell the goods or procure the sale thereof, such directions as appear to it to be expedient for the purpose of securing-
* The payment therefor if the goods has been sold; and
* The sale of goods and payment thereof, if goods or software has not been sold or reimport thereof into India as the circumstances permit, within such period as the RBI may specify in this behalf;
The omission of the RBI to give directions shall not have the effect of absolving the person committing the contravention from the consequences thereof.
Advance payment against exports
Regulation 15 provides that where an exporter receives advance payment from a buyer/third party named in the declaration made by the exporter, outside India, the exporter shall be under obligation to ensure that-
* The shipment of goods is made within 1 year from the date of receipt of advance payment;
* The rate
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he goods or software is covered by an irrecoverable letter of credit or by such other arrangement or document as may be indicated in the order;
* That any declaration to be furnished to the specified authority shall be submitted to the authorized dealer for its prior approval, which may, having regard to the circumstances, be given or withheld or may be given subject to such conditions as may be specified by the RBI by directions issued from time to time;
* That a copy of the declaration to be furnished to the specified authority shall be submitted to such authority or organization as may be indicated in the order for certifying that the value of goods specified in the declaration represents the proper value.
No direction shall be given by RBI and no approval shall be withheld by the Authorized dealer unless the exporter has been given a reasonable opportunity to make a representation in that matter.
Project imports
Regulation 17 provides that where an export of goods or service
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