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RBI mandates ADs to obtain Form A2 for all cross-border remittances
Under the erstwhile norms[ A.P.(DIR Series) Circular No. 16 dated September 12, 2002 read with A.P.(DIR Series) Circular No. 55 dated December 23, 2003 and A. P. (DIR Series) Circular No.118 dated May 07, 2012], Authorized Dealers could release foreign exchange for current account transactions up to USD 25,000 based on a simple letter with basic information. They did not need to obtain any other documents, including Form A2, and the payment was to be made by the applicant via Demand Draft or a cheque from their bank account.
Now, the RBI has mandated that the authorised dealers (ADs) shall obtain Form A2 in physical or digital form for all cross-border remittances, irrespective of the value of the transaction. Consequently, the above-mentioned norms stand withdrawn with immediate effect.
RBI removes limit on the amount of remittance via online submission of Form A2
Earlier, remittances that did not require any documentation, such as certain transactions under the Liberalised Remittance Scheme (LRS), could be made using only Form A2. Additionally, online submissions were limited to transactions up to USD 25,000 for individuals and USD 100,000 for corporates.
Now, to improve the ease of doing business, the Reserve Bank of India (RBI) has decided to allow all Authorised Dealers (AD Category-I banks and AD Category-II entities) to facilitate remittances based on the online or physical submission of Form A2 and any necessary documents. There will be no limit on the amount that can be remitted using the ‘online’ Form A2.
SEBI reduces face value for private placement of debt securities/non-convertible preference shares to Rs 10,000
SEBI has reduced the face value for issuing debt security or non-convertible redeemable preference shares on a private placement basis from Rs 1 lakh to Rs 10,000, subject to certain conditions. The condition is that the issuer must appoint at least one merchant banker, and such debt security or non-convertible redeemable preference share must be an interest/dividend-bearing security paying coupon/dividend at regular intervals with a fixed maturity.
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