Reporting by Indian Companies
The Reserve Bank of India had come up with a New Circular No. A.P. (DIR Series) Circular No. 37 dated 28th June, 2019 which stipulates that all Indian Companies which have received FDI and/or made FDI abroad (i.e. overseas investment) in the previous year(s) including the current year, should file the annual return on Foreign Liabilities and Assets (FLA) by using Web-based system online reporting portal.
It would facilitate data submission by eligible entities {including the alternative investment funds (AIF) registered with the Securities and Exchange Board of India (SEBI) as also the reporting of foreign investment in the form of capital/profit share contribution received/transferred in case of LLPs and investment by persons resident outside India in an investment vehicle and as defined in Foreign Exchange Management (Transfer or issue of security by a person resident outside India) Regulations 2017, dated November 7, 2017}.
Although it is not something which was not known, Earlier the same use to be filed by Companies in the soft form which can be duly filled- in, validated and sent by e-mail to the Reserve Bank of India by 15th July of every year.
(However the Last Date for filing FLA return for the F.Y. 2018-19 has been extended for 15 days and Now the last date for filing the FLA Return is 31st July, 2019).
The New web-based system online reporting portal is introduced with an objective to enhance the security-level in data submission and to further improve the data quality.
IMPORTANT FEATURES OF REVISED Foreign Liabilities and Assets Information Reporting (FLAIR) System:
1. Reserve Bank would provide a web-portal interface https://flair.rbi.org.in to the reporting entities for submitting “User Registration Form” (containing entity identification and business user details, where LLPs and AIFs will no longer required to use dummy CIN). The successful registration on web-portal will enable users to generate RBI-provided login-name and password for using FLA submission gateway and would include system-driven validation checks on submitted data.
2. The form will seek investor-wise direct investment and other financial details on fiscal year basis. (Earlier it was Mandatory only for Subsidiary Companies)
3. Upon Successful submission of the form reporting entities will get system generated acknowledgement receipt.
4. System also offers facility to revise the data, if required, and view/download the information submitted.
5. Entities can also submit FLA data for earlier years but after receiving RBI confirmation on their request mail.
6. The Existing Mechanism of E-Mail based FLA forms will be discontinued.
Indian entities not complying with above, will be treated as non-compliant with Foreign Exchange Management Act, 1999 and regulations made thereunder.
NOTE YOU ARE LOOKING FOR:
These directions will come into force with IMMEDIATE EFFECT and would be applicable for Reporting of information for the YEAR 2018-19.
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