Question
Download Solution PDFWhich of the following acts provides the regulations for 'Transfer or issue of security by a person living outside India'?
Answer (Detailed Solution Below)
Detailed Solution
Download Solution PDFThe correct answer is Foreign Exchange Management Act (FEMA).
Key Points
- The Foreign Exchange Management Act (FEMA), enacted in 1999, regulates foreign exchange transactions in India to ensure economic stability.
- FEMA governs the transfer or issue of securities by individuals or entities residing outside India, ensuring compliance with Reserve Bank of India (RBI) guidelines.
- Its primary objective is to facilitate external trade and payments and promote the orderly development of India's foreign exchange market.
- The act replaced the Foreign Exchange Regulation Act (FERA) of 1973, introducing a liberalized and modern framework for managing foreign exchange.
- Under FEMA, regulations related to foreign direct investment (FDI), external borrowings, and remittances are enforced to support India's economic growth.
Additional Information
- Foreign Contribution (Regulation) Act (FCRA):
- FCRA regulates the acceptance and use of foreign contributions by individuals, associations, or companies in India.
- Its aim is to prevent foreign influence on India's political, economic, and social activities.
- The act does not govern the transfer or issue of securities, making it unrelated to the given question.
- Securities and Exchange Commission (SEC) Act:
- This act is applicable in the United States and establishes the SEC to regulate securities markets.
- It ensures transparency, fairness, and investor protection in the US market and is irrelevant to Indian laws.
- Key Objectives of FEMA:
- To regulate external financial transactions and promote orderly foreign exchange market development.
- To facilitate capital flow for India's economic development while preventing illegal activities like money laundering.
- To govern international transactions, including cross-border investments and export-import payments.
- Difference Between FEMA and FERA:
- FERA was more stringent and focused on regulation, while FEMA is liberal and focuses on management.
- FEMA allows free and smoother flow of foreign investments compared to FERA's restrictive approach.
Last updated on Jul 4, 2025
-> The UP Police Sub Inspector 2025 Notification will be released by the end of July 2025 for 4543 vacancies.
-> A total of 35 Lakh applications are expected this year for the UP Police vacancies..
-> The recruitment is also ongoing for 268 vacancies of Sub Inspector (Confidential) under the 2023-24 cycle.
-> The pay Scale for the post ranges from Pay Band 9300 - 34800.
-> Graduates between 21 to 28 years of age are eligible for this post. The selection process includes a written exam, document verification & Physical Standards Test, and computer typing test & stenography test.
-> Assam Police Constable Admit Card 2025 has been released.