Page 50 - BANKING FINANCE November 2015 ONLINE
P. 50
RBI CIRCULAR
per cent to 7.75 per cent with effect from September 29, Registration Number (LRN) through submission of Form 83
2015. where type of ECB is to be specifically mentioned as
borrowing through issuance of Rupee denominated bonds
All penal interest rates on shortfall in reserve requirements, overseas), parking of bond proceeds, security / guarantee
which are specifically linked to the Bank Rate, also stand for the borrowings, conversion into equity, corporates under
revised. investigation, etc., not appearing in the Annex will be
applicable for borrowing by issuance of Rupee denominated
Yours faithfully bonds overseas.
(Lily Vadera)
Chief General Manager AD Category-I banks may bring the contents of this circular
to the notice of their constituents and customers.
External Commercial Borrowings (ECB)
Policy - Issuance of Rupee denominated The directions contained in this circular have been issued
under Section 10(4) and 11(1) of the Foreign Exchange
bonds overseas Management Act, 1999 (42 of 1999) and are without
prejudice to permissions / approvals, if any, required under
RBI/2015-16/193 any other law.
A.P. (DIR Series) Circular No.17
September 29, 2015 Yours faithfully
(B. P. Kanungo)
To, Principal Chief General Manager
All Authorised Dealer Category - I Banks
Madam/ Sir Regularization of assets held abroad by a
In order to facilitate Rupee denominated borrowing from person resident in India under Foreign
overseas, it has been decided to put in place a framework Exchange Management Act, 1999
for issuance of Rupee denominated bonds overseas within
the overarching ECB policy. The broad contours of the September 30, 2015
framework are as follows:
i. Eligible borrowers: Any corporate or body corporate as To
All Category - I Authorised Dealer Banks
well as Real Estate Investment Trusts (REITs) and Madam / Sir,
Infrastructure Investment Trusts (InvITs). 1. The Government of India has enacted The Black Money
ii. Recognised investors: Any investor from a Financial (Undisclosed Foreign Income and Assets) and Imposition
Action Task Force (FATF) compliant jurisdiction. of Tax Act, 2015 (Black Money Act) on May 26, 2015
to address the issue of undisclosed assets held abroad.
iii. Maturity: Minimum maturity period of 5 years. It provides for separate taxation of income and assets
acquired abroad from income not disclosed but
iv. All-in-cost: All in cost should be commensurate with chargeable to tax in India.
prevailing market conditions.
2. To effectively deal with assets held abroad by persons
v. Amount: As per extant ECB policy. resident in India in violation of the Foreign Exchange
Management Act, 1999 (FEMA) for which declarations
vi. End-uses: No end-use restrictions except for a negative have been made and taxes and penalties have been
list.
All other provisions of extant ECB guidelines regarding
reporting requirements (including obtaining Loan
50 | 2015 | NOVEMBER | BANKING FINANCE
Copyright@ The Insurance Times. 09883398055 / 09883380339