SEZ units foreign commodity hedging allowed without prior approval, subject to stand-alone isolation requirement for export-import transactions. A proviso to the Foreign Exchange Management (Foreign exchange derivative contracts) Regulations, 2000 permits a unit in a Special Economic Zone to enter into commodity exchange contracts outside India to hedge export/import price risk without prior Reserve Bank approval, provided such contracts are entered on a stand-alone basis, meaning the SEZ unit is completely isolated from financial contracts with its parent or subsidiary for those transactions.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
SEZ units foreign commodity hedging allowed without prior approval, subject to stand-alone isolation requirement for export-import transactions.
A proviso to the Foreign Exchange Management (Foreign exchange derivative contracts) Regulations, 2000 permits a unit in a Special Economic Zone to enter into commodity exchange contracts outside India to hedge export/import price risk without prior Reserve Bank approval, provided such contracts are entered on a stand-alone basis, meaning the SEZ unit is completely isolated from financial contracts with its parent or subsidiary for those transactions.
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