Foreign Liabilities & Assets Information Reporting (FLAIR) System – Introduction of New Reporting Mechanism by RBI

Background : Every Indian Company (‘the Company’) who has received FDI or has made an investment in foreign countries i.e. overseas investment in the previous year including current year needs to file a return called as Annual Return on Foreign Assets & Liabilities (‘FLA or the form’) with RBI, giving details of the foreign assets/liabilities. This form has to be filed by the Company every year on or before 15 July. The objective of introducing this form was to capture the statistics relating to the foreign assets and liabilities in a more comprehensive manner. Further, if the Partnership firms, Branches or Trustees having any overseas investment outstanding in the previous year, then they are required to report the same to RBI by filing such return.

1. Scenario’s where the Companies are not required to file the FLA return

In the following scenarios the Companies need not file the FLA return with RBI:

1. If the company does not have any outstanding investment in respect of inward and outward FDI as on 31st March i.e. end of reporting year.

2. If the company has received only share application money and does not have any foreign direct investment or overseas direct investment outstanding as on 31st

3. If all non-resident shareholders of a company has transferred their shares to the residents during the reporting period and the company does not have any outstanding investment as on 31st

4. Shares issued by the company to non-resident on Non-Repatriable basis should not be considered as foreign investment and therefore companies which have issued the shares to non-resident on Non-Repatriable basis.

2. Earlier Mechanism to submit the FLA Return with RBI

Earlier, the FLA return was an excel based utility form which had to be submitted every year with RBI via email. The return was required to be prepared based on the audited/unaudited accounts of the Company. The said return had to be mailed to RBI from official email id of authorized person of the Company like CFO, Director, Company Secretary etc. The Partnership firms, Branches or Trustees are required to send a request mail to get a dummy CIN number which will enable them to file the excel based FLA Return. These dummy CIN numbers as provided by RBI had to be used only for filling the excel based FLA return and not for any other purpose.

3. Introduction of New Reporting Mechanism for filing FLA Return

The RBI vide its notification A.P.(DIR Series) Circular No 37 dated 28 June 2019 has introduced new reporting mechanism for filing the FLA return with an objective to enhance the security level in data submission and to improve the data quality by replacing the existing email based reporting system with web based online reporting system.

4. Main features of revised Foreign Liabilities and Assets Information Reporting (FLAIR) system 

1. Reserve Bank has provided a web-portal interface the reporting entities for submitting “User Registration Form” .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 as hitherto, where all reporting entities are required to provide information on FATS related variables (it was mandatory only for subsidiary companies earlier). In addition, the revised form seeks information on first year of receipt of FDI/ODI and disinvestment.

3. Reporting entities will get system-generated acknowledgement receipt upon successful submission of the form.

4. They can revise the data, if required, and view/download the information submitted.

5. Entities can submit FLA information for earlier year/s after receiving RBI confirmation on their request email.

6. The existing mechanism of email-based submission of FLA forms will be discontinued.

Indian Companies not complying with above, will be treated as non-compliant with Foreign Exchange Management Act, 1999 and regulations made there under.

5. Additional disclosures/reporting requirements in new FLAIR System

Sr No Particulars New Reporting Mechanism
1 User Registration Form The Reporting Company needs to create a login account by filling a user registration form along with attaching a authority letter and verification letter.

This requirement is similar to the requirement of creating business user account while filing Single Master Form on the RBI Portal.

2 Details of Employees working in the Company The Reporting Company needs to submit the total number of employees working with them in the current year and the previous year.
3 First Year of receipt of FDI The Reporting Company needs to submit the First year of receipt of FDI.
4 Disinvestment during the year The Reporting Company needs to submit the total disinvestment done during the year.
5 Foreign Assets The Reporting Company needs to provide Total turnover, export turnover, Total purchases, import purchases and total employees of the Investee Company in which the Reporting Company has made investments.

Disclaimer: The information contained in this write up is to provide a general guidance to the intended user. The information should not be used as a substitute for specific consultations.

Source- RBI/2018-19/226 A.P. (DIR Series) Circular No. 37 Dated 28/06/2019


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    I would like to ask that suppose if FLAIR is filed on the basis of provisional Financials then whether it will be revised and filed again?
    Secondly, when I am trying to file again on basis of final Statement then its showing prior approval of RBI is required as the survey year is already closed.


    Earlier they had introduced EMF & SMF, where new login id were to be created. Now for reporting FLA again new id & password will need to be created. Authorities can simplify the system and allow submission through id of EMF & SMF.

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September 2021