Commodity hedge authorization permits residents to use overseas commodity contracts to mitigate price risk under RBI conditions. The Reserve Bank may authorize residents to enter into commodity contracts abroad to hedge price risk subject to conditions and Schedule III procedure; authorized dealer banks can be specially authorized to permit listed domestic companies to hedge imported/exported commodities under RBI directions and may seek RBI authority to grant such permissions. SEZ units may hedge on a stand-alone basis isolated from parent or subsidiary financial contracts, and Schedule III requires authorized dealers to verify documents and forward applications with recommendations to the Reserve Bank where applicable.
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.
Commodity hedge authorization permits residents to use overseas commodity contracts to mitigate price risk under RBI conditions.
The Reserve Bank may authorize residents to enter into commodity contracts abroad to hedge price risk subject to conditions and Schedule III procedure; authorized dealer banks can be specially authorized to permit listed domestic companies to hedge imported/exported commodities under RBI directions and may seek RBI authority to grant such permissions. SEZ units may hedge on a stand-alone basis isolated from parent or subsidiary financial contracts, and Schedule III requires authorized dealers to verify documents and forward applications with recommendations to the Reserve Bank where applicable.
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