Page 50 - Banking Finance April 2018

RBI CIRCULAR

3. The first set of returns should be filed with effect from Discontinuance of Letters of Undertaking
the: (i) last Friday of December 2017 for the weekly (LoUs) and Letters of Comfort (LoCs) for
return; (ii) quarter ended - December 31, 2017 for the
quarterly returns; (iii) half-year ending March 31, 2018 Trade Credits
for the half-yearly returns; and (iv) year ending March
RBI/2017-18/139
31, 2018 for the annual returns. All weekly, quarterly
returns upto December 31, 2017 shall be submitted by A.P. (DIR Series) Circular No. 20
April 15, 2018. Thereafter, these returns shall be
1. Attention of Authorised Dealer Category - I (AD
submitted within the timeline stipulated in the Master
Direction on returns to be submitted by NBFCs. Category - I) banks is invited to paragraph 2 of A.P. (DIR
Series) Circular No. 24 dated November 1, 2004
andparagraph No. 5.5 of Master Direction No.5 dated
Yours faithfully,
January 1, 2016 on 'External Commercial Borrowings,
(Dr. Sathyan David) Trade Credit, Borrowing and Lending in Foreign
Chief General Manager Currency by Authorised Dealers and Persons other than
Authorised Dealers' (Master Direction), as amended
Agency commission payable to banks for from time to time, on the issuance of LoUs/ LoCs/

operating Special Deposit Scheme (SDS) guarantees for Trade Credits for imports into India
under delegated powers of AD banks.
RBI/2017-18/140 2. On a review of the extant guidelines, it has been

DGBA.GBD.2294/15.01.001/2017-18 decided to discontinue the practice of issuance of LoUs/
LoCs for Trade Credits for imports into India by AD
1. Please refer to para 2 of our Master Circular RBI/2017- Category -I banks with immediate effect. Letters of
18/2 dated July 1, 2017 on Conduct of Government Credit and Bank Guarantees for Trade Credits for
Business by Agency Banks- Payment of Agency imports into India may continue to be issued subject to
compliance with the provisions contained in
Commission where in it is mentioned that SDS
Department of Banking Regulation Master Circular No.
transactions undertaken by agency banks are eligible
for agency commission. DBR. No. Dir. BC.11/13.03.00/2015-16 dated July 1,
2015 on "Guarantees and Co-acceptances", as
2. In this connection, it has been decided that agency amended from time to time.
commission claims on SDS related transactions (where
3. AD Category-I banks may bring the contents of this
mirror accounts are maintained in RBI) will be settled circular to the notice of their constituents and
at Central Accounts Section (CAS), Nagpur and not in
customers.
respective Regional Offices of RBI, with immediate
4. The aforesaid Master Direction No. 5 dated January 01,
effect. Accordingly, all agency banks handling SDS are
2016 will be updated to reflect the changes. The
advised to submit their agency commission claims
changes will be applicable from the date of issuance of
related to SDS transactions to CAS, Nagpur on quarterly
this circular.
basis.
5. The directions contained in this circular have been
3. However, agency banks will continue to claim
issued under sections 10(4) and 11(1) of the Foreign
reimbursement of interest paid and withdrawal from
Exchange Management Act, 1999 (42 of 1999) and are
SDS accounts from the respective Regional Offices of without prejudice to permissions/ approvals, if any,
RBI in which the mirror accounts are maintained. required under any other law.
Yours faithfully Yours faithfully
(Partha Choudhuri) Ajay Kumar Misra
General Manager Chief General Manager

50 | 2018 | APRIL | BANKING FINANCE