Quick Answer: What Is Difference Between FEMA And FERA?

Is Fera better than Fera?

These are the main differences between FERA vs FEMA….Difference between FERA and FEMA – UPSC Notes:- Download PDF Here.Foreign Exchange Regulation Act (FERA)Foreign Exchange Management Act (FEMA)FERA has 81 sectionsFEMA has 49 sections14 more rows.

What is FEMA declaration?

Foreign Exchange Management Act or in short (FEMA) is an act that provides guidelines for the free flow of foreign exchange in India. It has brought a new management regime of foreign exchange consistent with the emerging frame work of the World Trade Organisation (WTO).

What are the features of FEMA?

1. FEMA gives power to the central government for imposing restriction on activities like making payments to a person situated outside of the country or receiving money through them. Apart from this, foreign exchange as well as foreign security deals is also restricted by FEMA. 2.

What was the need of FEMA when Fera was there?

The primary objective of FEMA act was “facilitating external trade and payments and promoting the orderly development and maintenance of foreign exchange market in India”. FEMA was enacted by the Parliament of India in the winter session of 1999 to replace the Foreign Exchange Regulation Act (FERA) of 1973.

What is the purpose of Fera companies?

FERA – the four-letter acronym for Foreign Exchange Regulation Act is a legislation that came into existence in 1973 with the purpose to regulate certain dealings in foreign exchange, impose restrictions on certain kinds of payments and to monitor the transactions impinging the foreign exchange and the import and …

Which transactions are permitted without any approval under FEMA?

In terms of Section 5 of the FEMA, persons resident in India 1 are free to buy or sell foreign exchange for any current account transaction except for those transactions for which drawal of foreign exchange has been prohibited by Central Government, such as remittance out of lottery winnings; remittance of income from …

What do you mean by FERA?

Foreign Exchange Regulation ActThe Foreign Exchange Regulation Act (FERA) was legislation passed in India in 1973 that imposed strict regulations on certain kinds of payments, the dealings in foreign exchange (forex) and securities and the transactions which had an indirect impact on the foreign exchange and the import and export of currency.

When was FERA created?

May 1933Federal Emergency Relief Administration/Founded

What are the main provisions of FEMA?

The major provisions of FEMA, 1999 relate to following matters :Dealing in foreign exchange, etc.Holding of foreign exchange, etc.Current account transactions.Capital account transactions.Export of goods and services.Realization and repatriation of foreign exchange.More items…•

What was FEMA called before?

the Federal Civil Defense AdministrationHarry Truman started FEMA’s forerunner, the Federal Civil Defense Administration, in 1950.

Why was Fera replaced by FEMA?

The Foreign Exchange Regulation Act (FERA) was passed in 1973; the main purpose of which was to ensure the use of foreign exchange. The FERA was creating obstacles in the development of the country so government replaced it by FEMA in 1999.

How many sections are in FEMA?

49 sectionsFEMA contains 7 Chapters divided into 49 sections of which 12 sections cover operational part and the rest contravention, penalties, adjudication, appeals, enforcement directorate, etc.

Is FEMA a civil law?

6) This FEMA Act is a civil law and any kind of contraventions of the Act provide for arrest only in the exceptional cases.

What is FEMA limit?

Under the LRS, Indian citizens can transfer money to bank accounts abroad without needing to get special permission. However, money can only be intended for a set number of purposes, and remittances are allowed only up to a maximum annual limit which is currently set at USD 250,000.2.

How does RBI regulate foreign exchange?

The Reserve Bank’s exchange rate policy focusses on ensuring orderly conditions in the foreign exchange market. For the purpose, it closely monitors the developments in the financial markets at home and abroad. When necessary, it intervenes in the market by buying or selling foreign currencies.

What is the importance of FEMA?

The main objective of FEMA was to help facilitate external trade and payments in India. It was also meant to help orderly development and maintenance of foreign exchange market in India. It defines the procedures, formalities, dealings of all foreignexchange transactions in India.