DEA Notifies Foreign Exchange Rules in pursuance of union budget announcement
New Delhi: In pursuance of the Union Budget 2024-25 announcement by Union Minister for Finance and Corporate Affairs Nirmala Sitharaman to simplify rules and regulations for Foreign Investments, the Department of Economic Affairs (DEA) on Thursday notified the Foreign Exchange (Compounding Proceedings) Rules, 2024.
The DEA notified the rules under powers given under Section 46 read with section 15 of the Foreign Exchange Management Act (FEMA), 1999. The amended rules will supersede the existing Foreign Exchange (Compounding Proceedings) Rules, which were issued in 2000.
As part of a broader initiative to streamline and rationalize existing rules and regulations to further facilitate ease of doing business, the compounding proceeding rules were comprehensively reviewed in consultation with the Reserve Bank of India.
The emphasis has been on enabling provisions to expedite and streamline the processing of compounding applications, introduction of digital payment options for application fees and compounding amounts, and a focus on simplification and rationalization of the provisions to eliminate ambiguity and clarify the process.
These amendments indicate commitment of the government towards promoting ‘ease of investment’ for investors and ‘ease of doing business’ for businesses.
