Forward contract modification allowed for exporters to enhance hedging flexibility; banks may exclude options and overseas positions from NOOPL.
Exporters may cancel and rebook forward contracts involving the Rupee for hedging contracted export exposures up to an annual capped extent to provide operational flexibility. AD Category I banks may exclude their Net Options Position and positions of overseas branches from the Net Overnight Open Position Limit for Rupee involving positions, provided the bank's board fixes separate limits for these components within the overall NOOPL and communicates them to the Reserve Bank for approval.

Foreign exchange earnings retention restored for EEFC accounts, subject to conversion into rupees by the succeeding month after approved utilisations.
Full credit of foreign exchange receipts to EEFC accounts is permitted, conditioned on conversion of accruals in any calendar month into Rupee balances on or before the last day of the succeeding calendar month after adjusting for approved utilisations and forward commitments; the same procedure applies to Diamond Dollar and Resident Foreign Currency (Domestic) accounts, and authorised dealers must notify customers while other earlier terms remain unchanged.

Compounding of FEMA contraventions: a suo moto compounding application requires initiation of the compounding process.
When a contravention is identified or brought to the Reserve Bank other than via the prescribed compounding application, the Bank will determine whether it is technical/minor (administrative/cautionary advice), material (requires compounding under the prescribed procedure), or sensitive/serious (refer to the Directorate of Enforcement). If an entity files a suo moto compounding application admitting the contravention, it shall not be treated as technical or minor and the compounding process will be initiated under section 15(1) of FEMA read with the compounding rules.

Line of Credit requires majority Indian-sourced supplies, specified LC/disbursement timelines, GR/SDF declarations and FEMA compliance.
A Line of Credit from Exim Bank to Ethiopia finances Indian-sourced eligible goods, services, machinery, equipment and consultancy for sugar-industry development; at least 75 per cent of contract value must be supplied by Indian sellers with up to 25 per cent procured outside India. The Agreement fixes timelines for Letters of Credit and disbursements, mandates GR/SDF shipment declarations, prohibits agency commission under the LOC (subject to exporter-funded commission from own resources or EEFC after realization), and requires AD Category I banks to inform exporters; directions are issued under FEMA.

Line of Credit for infrastructure financing enables import of eligible Indian goods and services with specified domestic content, documentation.
Exim Bank extended a Line of Credit to Nepal to fund infrastructure-related imports of eligible Indian machinery, equipment, goods and consultancy, requiring at least 75% Indian content in contract value (with limited 25% non-Indian procurement), subject to possible reduction with borrower and governmental approval. The Credit Agreement is effective from June 29, 2012; LC opening and disbursement deadlines are set by contract type. Shipments must be declared on GR/SDF forms. No agency commission is payable under the LOC, though exporters may use own funds or EEFC balances for commission remittance subject to realisation and compliance; AD Category-I banks must inform exporters and facilitate compliance.

Resident foreign currency accounts exempted from prior circular; authorised dealer banks must notify customers under FEMA authority.
Provisions of Circular No. 124 dated May 10, 2012 will not apply to Resident Foreign Currency Accounts held as EEFC Accounts. Authorised Dealer Category I banks must inform their constituents and customers of this clarification. The instruction is issued under FEMA authority and is without prejudice to other statutory permissions or approvals.

Qualified Foreign Investor access to Indian corporate debt permitted, subject to single Rupee account, KYC and reporting obligations.
QFIs may invest on a repatriation basis in defined Indian corporate debt instruments through SEBI-registered QDPs or on recognised exchanges, subject to applicable pricing and listing timelines; each QFI must use a single non-interest bearing Rupee Account for all receipts and payments related to eligible securities and maintain a single demat account with a QDP. Eligibility is limited to persons resident in jurisdictions meeting FATF and IOSCO cooperation criteria (excluding certain jurisdictions and existing FII/FVCI registrants). KYC, reporting to RBI and SEBI, an overall investment ceiling, and permission to hedge currency risk apply.

Special Currency Basket valuation revised, requiring authorised dealer banks to adopt the new rupee conversion and notify constituents accordingly.
The Reserve Bank revised and fixed the rupee value of the Special Currency Basket effective in early July 2012, replacing the previously indicated value, for use in conversion and settlement under the Deferred Payment Protocols. Authorised Dealer Category I banks are directed to apply the revised valuation and notify their constituents. The directions are issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999, without prejudice to other legal permissions.

Revised A-2 Form purpose codes updated for foreign remittance filings, requiring authorised dealers to use annexed codes.
The Reserve Bank revised the list of purpose codes appended to Form A-2 to align with amended purpose codes used on R-Returns and annexed the revised list and updated Form A-2 for applicants remitting funds abroad; Authorised Dealers must implement the revised coding under the regulatory authority of the Foreign Exchange Management Act, 1999.

Non-Resident Deposit reporting now requires only electronic submission to the central statistics office; hard copies discontinued for most banks.
Banks dealing in foreign exchange must submit Stat 5 and Stat 8 returns in the prescribed electronic format only to the central statistics office and may stop sending hard copies to that office; Co-operative Banks and Regional Rural Banks should continue submitting both hard and soft copies to the regional offices. The instructions are issued under powers conferred by the foreign exchange legislation and are without prejudice to other statutory permissions or approvals.

Interbank rollover flexibility allows residents to switch authorised dealer banks for hedge contract rollover on maturity date.
The Reserve Bank extended the existing inter-bank switch facility so that residents may rollover hedge transactions by switching Authorised Dealer Category I banks on the contract maturity date. The extension applies to all hedge transactions and remains subject to the established conditions: a commercially warranted reason for the switch, simultaneous cancellation and rebooking on maturity, and the rebooking bank's responsibility to ensure cancellation of the original contract. These directions are issued under the Foreign Exchange Management Act.

Special Currency Basket revision: Rupee value adjusted; authorised banks to apply FEMA directions and notify constituents.
The Reserve Bank revised the Rupee valuation of the Special Currency Basket and instructed Category I Authorised Dealer banks to apply the new value in dealings under the Deferred Payment Protocols with the erstwhile USSR, requiring banks to notify their constituents; the directions are issued under the Foreign Exchange Management Act (FEMA) and without prejudice to other legal permissions.

Buyback of FCCBs permitted under approval route with discount requirement and reporting and compliance obligations.
Continuation of the scheme permitting buyback of Foreign Currency Convertible Bonds (FCCBs) under the approval route, subject to a minimum discount on accreted value and compliance with foreign currency borrowing rules where applicable; other terms of the earlier circular remain applicable and the facility is time-bound. Post-buyback compliance requires submission of the ECB-2 return and a detailed report through the designated Category-I Authorised Dealer bank specifying outstanding FCCB amounts, accreted value bought back, buyback rates, amounts and sources of funds.

Foreign investment in India: rules for FDI and portfolio inflows, routes, sectoral caps, pricing, payment and reporting.
The Master Circular consolidates RBI rules under FEMA governing foreign investment in India: permitted instruments (equity, fully and mandatorily convertible debentures/preference shares), two entry routes (Automatic and Government), investor eligibility, pricing and payment modalities (including conversions of ECBs, royalty/technical fees and import payables into equity), sectoral caps and prohibited activities, and detailed reporting and documentation requirements (FC GPR, FC TRS, KYC, auditor/secretary certificates). It also compiles PIS, FVCI, ADR/GDR/IDR, escrow and account rules, monitoring obligations of AD banks/custodians and annexed sectoral schedules.

Export of Goods and Services regulation consolidated, directing authorised dealer banks to follow unified instructions subject to a temporary sunset.
Export of goods and services is governed by the Foreign Exchange Management Act and Current Account Rules; this Master Circular consolidates existing instructions for Category I Authorised Dealer banks, lists underlying circulars in an appendix, and is issued with a sunset clause after which it will be withdrawn and replaced by an updated master circular.

Advance remittance conditions: banks must obtain guarantees, conduct due diligence and require evidence of import before permitting remittances.
Master Circular directs AD Category I banks to ensure imports comply with Foreign Trade Policy and FEMA, apply KYC/AML, obtain and preserve requisite import documentation (including Exchange Control copies of Bills of Entry), and to follow prescribed time limits and reporting obligations. It prescribes conditions for advance remittances and when guarantees or standby LCs are required, sets sectoral relaxations and documentation substitutes for certain importers, and requires follow up, verification, acknowledgement and retention of import evidence along with specified half yearly and monthly reporting duties.

External commercial borrowings and trade credits framework: routes, eligible parties, cost ceilings, end use limits and reporting requirements.
The Master Circular consolidates RBI rules under FEMA governing External Commercial Borrowings (ECB) and trade credits, delineating two routes-Automatic and Approval-with specified eligible borrowers and recognised lenders, instrument types, amount and maturity thresholds, all in cost ceilings, permitted and prohibited end uses, security and guarantee conditions, mandatory Loan Registration Number before drawdown, AD bank reporting obligations (Form 83, ECB 2), and delegated powers to AD Category I banks for certain post LRN modifications, while reserving other approvals to the Reserve Bank.

Overseas direct investment rules: automatic and approval routes, 400% net worth ceiling, ODI reporting and UIN requirements.
The Master Circular consolidates FEMA Regulation based rules permitting residents to make overseas direct investments in JVs and WOS under the Automatic Route (subject to a 400% of net worth financial commitment ceiling and defined inclusions such as equity, loans and guarantees) or the Approval Route. It prescribes eligible funding sources, sectoral safeguards for financial services, valuation and documentation standards, designated AD bank routing, Form ODI reporting and UIN allotment, APR and disinvestment procedures, rules on guarantees, pledges, hedging, write offs, ESOP treatment, and operational responsibilities of AD Category I banks.

Money changing activities: licensing, net owned funds, branch/franchise approvals, KYC/AML, transaction limits, recordkeeping and reporting requirements.
The Circular prescribes the Reserve Bank's consolidated licensing, expansion and operational requirements for AMCs/FFMCs/ADs: corporate registration and minimum Net Owned Funds; documentation, auditor certification and fit and proper assessments; prior approval for additional branches and franchise arrangements with due diligence, reporting and distance limits; operational rules on purchases/sales, payment modes, encashment certificates, registers (FLM forms) and settlement methods; KYC/AML/CFT policies with risk based customer due diligence, record retention for ten years, CTR/STR reporting to FIU IND; concurrent audit and Reserve Bank inspection powers; and revocation powers for non compliance.

Compounding of FEMA contraventions enables voluntary settlement upon quantification and payment, subject to eligibility and process safeguards.
Compounding under FEMA, 1999 is a voluntary, discretionary mechanism permitting settlement of admitted contraventions by payment of a quantified sum; the RBI may compound all FEMA contraventions except clause (a) of Section 3, which is handled by the Directorate of Enforcement. Applications must be in prescribed form with supporting annexures and fee, and will be disposed within 180 days. Compounding is unavailable where amounts are not quantifiable, where a similar contravention was compounded within three years, where required statutory approvals are not obtained, or where money laundering, national security or serious regulatory concerns require referral to enforcement agencies.