/ Foreign Exchange Management Act

FAQs ON RBI REPORTING UNDER SINGLE MASTER FORM

 

RBI reserve bank of india

FAQs ON RBI REPORTING UNDER SINGLE MASTER FORM

Q.1 the primary step for creating the specified reporting under a brand-new structure?

Ans: Registration as Entity user is that the initial step within the new reporting system, if you’re registered as Entity user then you’ll file the Entity Master for providing the main points of Foreign Direct Investment including indirect foreign investment. Submission of Entity master doesn’t mean that you just have done regulatory filings under FEMA 20(R).
You firstly must last https://firms.rbi.org.in/firms/ and choose Registration Form for Entity User.

Q.2 What does mean Entity and Entity user?
Ans:

  • A company within the meaning of section 1(4) of the businesses Act, 2013;
  • A financial obligation Partnership (LLP) registered under the indebtedness Partnership Act, 2008;
  • A startup which complies with the conditions laid down in Notification No. G.S.R 180(E) dated February 17, 2016, issued by Department of commercial Policy and Promotion, Ministry of Commerce and Industry, Government of India

They need to authorize one one who would be solely authorized to add/update the foreign investment details of an Entity within the Entity Master and would be entirely accountable for the info entered, this person is thought as Entity User.

Q.3 Can Entity user be changed?

Ans: Yes, if the entity wishes to alter the Entity user, it’s going to contact RBI helpdesk, the main points of which are available under “Contact Us” on https://firms.rbi.org.in/firms/.
Also, the Entity may send asking to fedsupport@rbi.org.in for updating the registered email id and resetting the password.

Q.4 Documents required to register the entity for Entity master form?

FAQs ON RBI REPORTING UNDER SINGLE MASTER FORM
Ans:

  • Signed copy of authorization letter within the prescribed format which is obtainable within the user manual for Entity Master;
  • A copy of pan card of authorized person;
  • A copy of pan card issued in the name of the said entity.

Maximum attachment size is 1 MB for all attachments.

Q.5 How will the Entity get the registration for filling the Master Entity Form?

Ans: Authority Letter submitted by the entity user are verified by RBI and after RBI’s approval, the user will receive the password on their registered email ID from RBI email ID autoreplyfid@rbi.org.in.
(Note: If the user doesn’t receive the mail notification for approval/rejection of the registration within the subsequent 48 hrs. he/she may contact at helpfirms@rbi.org.in).

Q.6 how to rectify the incorrect data filled in Entity Master?

Ans: For any correction within the entity master details, the request is made at fedsupport@rbi.org.in and helpfirms@rbi.org.in within the following format:

  • User ID:
  • CIN/LLP Number:
  • Registered Email Id:
  • Issue description (Reasons for the change):
  • What are the changes must be done?
Sr. No. Data field to be updated Old value (existing) New Value (to be updated)

Also, the applicant is required to submit a signed request letter, authorized by the Director/MD/authorized signatory of Company or Designated partner of LLP for confirming such change.

Q.7 What to try to if registration is canceled by RBI?

Ans: just in case of rejection of registration, use another User Name for fresh registration (other than the one given earlier).

Q.8 a way to proceed for the second step for completing mandatory reporting of FDI related transactions?

Ans: After getting the Entity user registration, the entity required to urge the business user registration yet. For this, you wish to travel on https://firms.rbi.org.in/firms/ and choose Registration Form for Business User and fill the mandatory details and fasten the authorization letter (the format of this letter is given in user manual for SMF). Please note that this registration can even be availed by a private within the case where a resident individual is required to report.

Q.9 During filing a form in SMF, the pre transactions values within the shareholding pattern don’t seem to be correct?

Ans: The pre-transaction values within the Shareholding pattern are carried from the main points entered within the Entity Master. Please check the identical and if the entries filled in entity Master are wrong then you’ll be able to apply for rectification. Please see pt.no. 6.

Q.10 After filing the shape in SMF, how we will get the update on the filing?

Ans: since the AD banks process such filing, the person shall contact their AD bank to whom such reporting was made (as per the IFSC chose or branch at the time of Business User registration).

Q.11 Maximum time provided to AD for processing the form?

Ans: All forms filed within the SMF shall be processed within 3 working days of receiving the identical.

Q.12 Who will process the filed form and therefore the pattern of processing of form?

Ans: a group of the checklist as applicable to it particular return is being provided to the AD bank together with the filed form. AD bank is required to test only those details and if found to be so as, approve the return.

In case the Business user has not provided the main points, AD Bank shall reject the shape. it should be noted that there’s no provision for resending or resubmission or attaching any clarification once the shape is submitted.

Therefore, AD may take due caution while approving or rejecting the identical. In exceptional cases where for the precise reasons the AD has to refer the shape to RBI. RBI would supply the recommendation on whether the shape is approved or rejected to the AD bank.

Q.13 Will the ARF be required to be filled in SMF?

Ans: After the introduction of SMF, ARF stands discontinued with effect from September 01, 2018. Now, a user is required to form a report of FDI received within the section under FCGPR only.

Q.14 What happens just in case of delay in reporting?

Ans: User has to attach the rationale for the delay and AD could also be forwarded to the respective regional office for advice on Late Submission Fee (LSF) as could also be decided by the banking company, in consultation with the Central Government, for any delays in reporting.

Q.15. How was reporting done before the RBI Single Master Form?

Ans: Before the RBI Single Master Form was introduced in 2018, the reporting compliances were meted out by the RBI through an internet system. this method is named the e-biz online application system. When reporting a far-off Investment or Foreign currency in India, the appliance was made through Foreign Currency Transfer of Shares (FCTRS) through the net portal called the e-biz portal. This initiative was taken by the govt of India so as to attach government to businesses and to realize simple doing business in India. Under the previous e-biz reporting regime, investment in shares or transfer of shares may be made by a far-off company to Indian Company and contrariwise.

The online process facilitated a gateway through which the applicants could apply for foreign investment within the country. After uploading the appliance for foreign investment, the Authorized dealer or bank would review the applying and forward the identical to the RBI. On receipt of the appliance under the e-biz portal, the RBI would scrutinize the appliance for foreign investment. After examining, the RBI would approve and reject the identical associated with Foreign Investment was present until 2018. This has been replaced by a replacement RBI Single Master

Q.16. Whether compounding option is out there for reporting delays?

Ans: The payment in respect of LSF is a penalty levied for regularizing reporting delays without undertaking the compounding procedure. However, this doesn’t mean that the applicant cannot apply for compounding. It is provided that the applicant is eligible for both options, in respect of transactions undertaken on or after November 7, 2017.

Q.17. Amount of LSF prescribed by RBI for delay reporting?
Ans:

AMOUNT TO BE REPORTED (RS) LATE SUBMISSION FEE AS PROVIDED IN % OF THE AMOUNT TO BE REPORTED MAXIMUM CAP OF LSF

 
UP TO 10 MILLION 0.05 % RS.1 MILLION OR 300% OF THE AMOUNT INVOLVED, WHICHEVER IS LOWER
MORE THAN 10 MILLION 0.15 % RS.10 MILLION OR 300% OF THE AMOUNT INVOLVED, WHICHEVER IS LOWER
* THE % OF LSF WILL BE DOUBLED EVERY TWELVE MONTHS;

THE FLOOR (MINIMUM APPLICABLE AMOUNT) FOR LSF WILL BE RS. 100

 

Q.18 Some checks for LSF for delay reporting?
Ans:

  • Amount involved X time rounded off to the subsequent higher month X 0.05 % or 0.15 % because the case is also. For the aim of calculation, “months” shall include Sundays/ Holidays;
  • In case the reporting form (whether in physical or electronic form) is incomplete then the delay will continue till such time the shape is received complete all told respects. Hence, you would like to be assured that everyone the mandatory information and documents are filed with the AD. Incomplete form will result into rejection of your form and you wish to submit the fresh form.
  • The late submission fee is levied in respect of delay in reporting. Contravention in respect of non-issue/ late issue of capital instruments or non-transfer/ late transfer of capital instruments and other contraventions under the provisions of FEMA 20(R) are proceeded against according to the procedure laid down under sections 13 and 15 of FEMA, 1999.
  • The LSF could also be paid by way of a requirement draft drawn in favor of “Reserve Bank of India” and payable at the Regional Office concerned.

Q.19. Who can make an application under the RBI Single Master Form?

The following entities can make an application under the RBI Single Master Form:

  • A company incorporated under the Companies’ act 2013
  • An LLP
  • A start-up

Q.20. What are the benefits of Single Master Form?

With the introduction of the RBI Single Master Form reporting of Foreign Investment in India, the following benefits have been provided –

  • Improves the Economy and GDP of India.
  • Assists in keep track of the quantity of foreign investment received in India.
  • Assists in monitoring the applying status of the applicant regarding the grant or opposition of the investment.
  • Through the RBI Single Master Form, compliance with the FEMA is often controlled.

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