RBI has issued circulars on the following subjects.
Deregulation of Savings Bank Deposit Interest Rate - Guidelines
OTC Foreign Exchange Derivatives – Foreign Currency – INR swaps
External Commercial Borrowings (ECB) Policy
ECB Policy – Parking of ECB proceeds
Interest Rates on Non-Resident (External) Rupee (NRE) Deposits and FCNR(B) Deposits
Interest Rates on Non-Resident (External) Rupee (NRE) Deposits and FCNR(B) Deposits
RBI/2011-12/275
DBOD.Dir.BC. 59/13.03.00/2011-12
All Scheduled Commercial Banks
(excluding RRBs)
Dear Sir/Madam
DBOD.Dir.BC. 59/13.03.00/2011-12
November 23, 2011
All Scheduled Commercial Banks
(excluding RRBs)
Dear Sir/Madam
Interest Rates on Non-Resident (External) Rupee (NRE) Deposits and FCNR(B) Deposits
1. Interest Rates on Non-Resident (External) Rupee (NRE) Deposits
Please refer to paragraph 1 of our circular DBOD.No.Dir.BC.82/13.03.00/2008-09 dated November 15, 2008 on Interest Rates on Deposits held in Non-Resident (External) Rupee (NRE) Accounts. In view of the prevailing market conditions, it has been decided that until further notice and with effect from close of business in India as on November 23, 2011, the interest rates on Non- Resident (External) Rupee (NRE) Term Deposits will be as under:
Interest rates on fresh Non-Resident (External) Rupee (NRE) Term Deposits for one to three years maturity should not exceed the LIBOR/SWAP rates plus 275 basis points, as on the last working day of the previous month, for US dollar of corresponding maturities (as against LIBOR/SWAP rates plus 175 basis points effective from close of business on November 15, 2008). The interest rates as determined above for three year deposits will also be applicable in case the maturity period exceeds three years. The changes in interest rates will also apply to NRE deposits renewed after their present maturity period.
2. Interest Rates on FCNR(B) deposits
Please refer to paragraph 2 of our circular No.DBOD.Dir.BC.82/13.03.00/2008-09 dated November 15, 2008 on Interest Rates on Deposits held in FCNR(B) Accounts. It has also been decided that until further notice and with effect from the close of business in India as on November 23, 2011, the interest rates on FCNR(B) Deposits will be as under:
In respect of FCNR (B) deposits of all maturities contracted effective from the close of business in India as on November 23, 2011, interest shall be paid within the ceiling rate of LIBOR/SWAP rates plus 125 basis points for the respective currency/corresponding maturities (as against LIBOR/SWAP rates plus 100 basis points effective from close of business on November 15, 2008). On floating rate deposits, interest shall be paid within the ceiling of SWAP rates for the respective currency/maturity plus 125 basis points. For floating rate deposits, the interest reset period shall be six months.
3. All other instructions in this regard, as amended from time to time, will remain unchanged.
4. An amending directive DBOD.No.Dir.BC. 58/13.03.00/2011-12 dated November 23, 2011 is enclosed.
Yours faithfully,
(P.R.Ravi Mohan)
Chief General Manager
--------------------------------------------------------------------------------
DBOD.Dir.BC. 58 /13.03.00/2011-12
November 23, 2011
Interest Rates on Non-Resident (External) Rupee (NRE) Deposits and FCNR(B) Deposits
In exercise of the powers conferred by Section 35A of the Banking Regulation Act, 1949, and in modification of the directive DBOD.No.Dir.BC.81/13.03.00/2008-09 dated November 15, 2008 on Interest Rates on Deposits held in Non-Resident (External) (NRE) Accounts and FCNR(B) Accounts, the Reserve Bank of India being satisfied that it is necessary and expedient in the public interest so to do, hereby directs that Interest Rates on Non-Resident (External) Rupee (NRE) Deposits and FCNR(B) deposits shall be as under:
Interest Rates on Non-Resident (External) Rupee (NRE) Deposits
"With effect from close of business as on November 23, 2011, interest rates on fresh Non-Resident (External) Rupee (NRE) Term Deposits for one to three years maturity should not exceed the LIBOR/SWAP rates plus 275 basis points, as on the last working day of the previous month, for US dollar of corresponding maturities (as against LIBOR/SWAP rates plus 175 basis points effective from the close of business on November 15, 2008). The interest rates as determined above for three year deposits will also be applicable in case the maturity period exceeds three years. The changes in interest rates will also apply to NRE deposits renewed after their present maturity period."
Interest Rates on FCNR(B) deposits
"In respect of FCNR(B) deposits of all maturities contracted effective from the close of business in India as on November 23, 2011, interest shall be paid within the ceiling rate of LIBOR/SWAP rates plus 125 basis points for the respective currency/corresponding maturities (as against LIBOR/SWAP rates plus 100 basis points effective from the close of business on November 15, 2008). On floating rate deposits, interest shall be paid within the ceiling of SWAP rates for the respective currency/maturity plus 125 basis points. For floating rate deposits, the interest reset period shall be six months."
(B. Mahapatra)
Executive Director
Related Press Release
Nov 23, 2011
ECB Policy – Parking of ECB proceeds
RBI/2011-12/274
A.P. (DIR Series) Circular No. 52
To
All Authorised Dealer Category I Banks
Dear Madam / Sir,
A.P. (DIR Series) Circular No. 52
November 23, 2011
To
All Authorised Dealer Category I Banks
Dear Madam / Sir,
External Commercial Borrowings (ECB) Policy – Parking of ECB proceeds
1.Attention of Authorized Dealer Category-I (AD Category-I) banks is invited to A.P. (DIR Series) Circular No. 26 dated October 22, 2008 relating to the External Commercial Borrowings (ECB).
2. At present, borrowers are permitted to either keep ECB proceeds abroad or remit these funds to India, pending utilization for permissible end-uses. ECB proceeds parked overseas can be invested in liquid assets, such as, deposits or Certificates of Deposit or other products offered by banks ( rated not less than AA (-) by Standard and Poor/Fitch IBCA or Aa3 by Moody's), Treasury bills and other monetary instruments of one year maturity having minimum rating as indicated above and deposits with overseas branches / subsidiaries of Indian banks abroad. The underlying principle is that funds should be invested in such a way that the investments can be liquidated as and when funds are required by the borrower. ECB funds may also be repatriated to India for credit to the borrowers Rupee accounts with AD Category I banks in India pending utilization for the permissible end-uses.
3. Based on a review of the current macro economic conditions, it has been decided that henceforth the proceeds of the ECB raised abroad meant for Rupee expenditure in India, such as, local sourcing of capital goods, on-lending to Self-Help Groups or for micro credit, payment for spectrum allocation, etc. should be brought immediately for credit to their Rupee accounts with AD Category I banks in India. In other words, ECB proceeds meant only for foreign currency expenditure can be retained abroad pending utilization. The rupee funds, however, will not be permitted to be used for investment in capital markets, real estate or for inter-corporate lending, as hitherto.
4. The amended ECB policy will come into force with immediate effect and is subject to review. All other aspects of ECB policy would remain unchanged.
5. AD Category - I banks may bring the contents of this circular to the notice of their constituents and customers.
6. The directions contained in this circular have been issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.
Yours faithfully,
(Rashmi Fauzdar)
Chief General Manager
Related Press Release
Nov 23, 2011
ECB Policy
RBI/2011 -12/273
A. P. (DIR Series) Circular No. 51
To,
All Category - I Authorised Dealer Banks
Dear Madam / Sir,
A. P. (DIR Series) Circular No. 51
November 23 , 2011
To,
All Category - I Authorised Dealer Banks
Dear Madam / Sir,
External Commercial Borrowings (ECB) Policy
1.Attention of Authorised Dealer Category-I (AD Category-I) banks is invited to A. P. (DIR Series) Circular No. 19 dated December 9, 2009 relating to the all-in-cost ceiling of External Commercial Borrowings ( ECB ).
2. On a review of developments in the global financial markets and the fact that borrowers are experiencing difficulties in raising ECBs within the existing all-in-cost ceiling, it has been decided to revise the all-in-cost ceiling for ECB as under:
| Average Maturity Period | All-in-cost over 6 month LIBOR* | |
| Existing | Revised | |
| Threeyears and up to five years | 300 bps | 350 bps |
| Morethan five years | 500 bps | 500 bps ( no change) |
| * for the respective currency of borrowing or applicable benchmark | ||
3. The enhancement in all-in-cost ceiling is applicable up to March 31, 2012 and subject to review thereafter. The change in the all-in-cost ceiling will come into force immediately. All other aspects of ECB policy remain unchanged.
4. AD Category-I banks may bring the contents of this circular to the notice of their constituents and customers concerned.
5. The directions contained in this circular have been issued under sections 10 (4) and 11 (1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.
Yours faithfully,
(Rashmi Fauzdar)
Chief General Manager
Related Press Release
Nov 23, 2011
OTC Foreign Exchange Derivatives – Foreign Currency – INR swaps
RBI/2011-12/272
A. P. (DIR Series) Circular No. 50
To,
All Category - I Authorised Dealer Banks
Madam / Sir,
A. P. (DIR Series) Circular No. 50
November 23, 2011
To,
All Category - I Authorised Dealer Banks
Madam / Sir,
Comprehensive Guidelines on Over the Counter (OTC) Foreign Exchange Derivatives – Foreign Currency – INR swaps
1.Attention of the Authorised Dealer Category - I (AD Category - I) banks is invited to A.P. (DIR Series) Circular No. 32 dated December 28, 2010, which sets out the guidelines governing the foreign exchange derivative contracts. In terms of the sub-para (iv) (c) on Foreign Currency-INR swaps in para 1 of the Part B.I. of the Section B in the Annex to the A.P. (DIR Series) Circular No. 32 dated December 28, 2010 the extant instructions state that "Swap transactions may be undertaken by AD Category I banks as intermediaries by matching the requirements of corporate counterparties. While no limits are placed on the AD Category I banks for undertaking swaps to facilitate customers to hedge their foreign exchange exposures, a limit of USD 100 million is placed for net supply of foreign exchange in the market…."
2. On a review, it has been decided to remove the above limit of USD 100 million placed for these swap transactions.
3. AD Category - I banks may bring the contents of this circular to the notice of their constituents and customers concerned.
4. The directions contained in this circular have been issued under Sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions /approvals, if any, required under any other law.
Yours faithfully,
(Meena Hemchandra)
Chief General Manager-in-Charge
Deregulation of Savings Bank Deposit Interest Rate - Guidelines
RBI/2011-12/272
RPCD.CO.RRB.BC.No.33/ 03.05.33/2011-12
All Regional Rural Banks
Dear Sir,
RPCD.CO.RRB.BC.No.33/ 03.05.33/2011-12
November 23, 2011
All Regional Rural Banks
Dear Sir,
Deregulation of Savings Bank Deposit Interest Rate - Guidelines
1.Please refer to our circular RPCD.CO.RRB.BC.No.68/03.05.33/2010-11 dated May 3, 2011.
2. As indicated in the Second Quarter Review of Monetary Policy announced on October 25, 2011, it has been decided to deregulate the savings bank deposit interest rate with immediate effect. Accordingly, the following Guidelines will be effective from October 25, 2011:
- Banks are free to determine their savings bank deposit interest rate, subject to the following two conditions:
- First, each bank will have to offer a uniform interest rate on savings bank deposits up to Rs.1 lakh, irrespective of the amount in the account within this limit.
- Second, for savings bank deposits over Rs.1 lakh, a bank may provide differential rates of interest, if it so chooses, subject to the condition that banks will not discriminate in the matter of interest paid on such deposits, between one deposit and another of similar amount, accepted on the same date, at any of its offices.
3. The above revised Guidelines would be applicable to savings bank deposits of resident Indians only.
4. Interest rate on Non-Resident (External) Accounts Scheme and Ordinary Non-Resident Deposit under savings account, which has been prescribed at 4 per cent per annum at present, will continue to be regulated until further review.
5. An amending directive RPCD.CO.RRB.BC.Dir.No.27/03.05.33/2011-12 dated October 25, 2011 is enclosed.
6. Please acknowledge receipt of this circular to the Regional Office concerned.
Yours faithfully,
(C.D.Srinivasan)
Chief General Manager
Encl: As above
--------------------------------------------------------------------------------
RPCD.CO.RRB.BC.Dir.No.27/03.05.33/2011-12
October 25, 2011
Deregulation of Savings Bank Deposit Interest Rate
In exercise of the powers conferred by Section 35 A of the Banking Regulation Act, 1949 and in partial modification of its directive RPCD.CO.RRB.BC.No.67/03.05.33/2010-11 dated May 3, 2011, the Reserve Bank of India, being satisfied that it is necessary and expedient in the public interest so to do, hereby directs that banks are free to determine their savings bank deposit interest rate for resident Indians only with immediate effect subject to two conditions. First, each bank will have to offer a uniform interest rate on savings bank deposits up to Rs.1 lakh, irrespective of the amount in the account within this limit. Second, for savings bank deposits over Rs.1 lakh, a bank may provide differential rates of interest, if it so chooses, subject to the condition that banks will not discriminate in the matter of interest paid on such deposits, between one deposit and another of similar amount, accepted on the same date, at any of its offices.
(V.K.Sharma)
Executive Director
Friday, November 18, 2011
"Set-off" of export receivables against import payables - Liberalization of Procedure
RBI/2011-12/264
A.P. (DIR Series) Circular No. 47
To
All Category – I Authorized Dealer Banks
Madam/Sir,
A.P. (DIR Series) Circular No. 47
November 17, 2011
To
All Category – I Authorized Dealer Banks
Madam/Sir,
"Set-off" of export receivables against import payables-Liberalization of Procedure
Attention of Authorized Dealer Category – I (AD Category – I) banks is invited to the fact that the requests received from the exporters through their AD branches for set-off of export receivables against import payables are considered by the Reserve Bank of India. As a measure of further liberalization, it has been decided to delegate power to AD Category – I banks to deal with the cases of "set-off" of export receivables against import payables, subject to following terms and conditions:
a.The import is as per the Foreign Trade Policy in force.
b.Invoices/Bills of Lading/Airway Bills and Exchange Control copies of Bills of Entry for home consumption have been submitted by the importer to the Authorized Dealer bank.
c.Payment for the import is still outstanding in the books of the importer.
d.Both the transactions of sale and purchase may be reported separately in 'R' Returns.
e.The relative GR forms will be released by the AD bank only after the entire export proceeds are adjusted / received.
f.The " set-off" of export receivables against import payments should be in respect of the same overseas buyer and supplier and that consent for "set-off" has been obtained from him.
g.The export / import transactions with ACU countries should be kept outside the arrangement.
h.All the relevant documents are submitted to the concerned AD bank who should comply with all the regulatory requirements relating to the transactions.
2. AD Category – I banks may bring the contents of this circular to the notice of their constituents and customers concerned.
3. The directions contained in this circular have been issued under Sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.
Yours faithfully,
(Dr. Sujatha Elizabeth Prasad)
Chief General Manager
Wednesday, November 16, 2011
COUNCIL GUIDELINES FOR CONVERSION OF CA FIRMS INTO LLPS
COUNCIL GUIDELINES FOR
CONVERSION OF CA FIRMS INTO LLPS
(Guidelines No.1-CA (7)/03/2011, dated 4th November, 2011)
In terms of the Council decision dated 14 July, 2011, following guidelines for conversion of CA firms into LLPs and constitution of separate LLPs by the practicing Chartered Accountants have been finalized which are applicable for conversion of CA firms into LLPs or formation of new LLPs by the members in practice of the Institute subject to the provisions of the Limited Liability Partnership (LLP) Act, 2008 and Rules & Regulations framed there under:-
(A) Conversion of CA firms into LLPs
1. All existing CA firms who want to convert themselves into LLPs are required to follow the provisions of Chapter-X of the Limited Liability Partnership Act, 2008 read with Second Schedule to the said Act containing provisions of conversion from existing firms into LLP.
2. In terms of Rule 18(2) (xvi) of LLP Rules- 2009, if the proposed name of LLP includes the words `Chartered Accountant' or chartered Accountants, as the case may be, as part of the proposed name, the same shall be referred to the Institute of Chartered Accountants of India (ICAI) by the Registrar of LLP and it shall be allowed by the Registrar only if the Secretary, ICAI approves it.
3. If the proposed name of LLP of CA firm resemble with any other non-CA entity as per the naming Guidelines under LLP Act and its Rules, the proposed name of LLP of CA firms may include the word `Chartered Accountant' or `Chartered Accountants', as the case may be in the name of the LLP itself and the Registrar, LLP may allow the same name, subject to compliance to Rule 18(2) (xvi) of LLP Rules as referred above.
4. For the purpose of registration of LLP with ICAI under regulation 190 of the Chartered Accountants Regulations, 1988, the partners of the firm shall apply in ICAI Form No. '117' and the ICAI Form No. '18' along with copy of name registration received from the Registrar of LLP and submit the same with the concerned Regional office of the ICAI. These Forms shall contain all details of the officers and other particulars as called for together with the signatures of all partners or authorized partner of the proposed LLP.
5. The names of the CA firms registered with the ICAI shall remain reserved for the partners as one of the options for LLP names subject to the provisions of LLP Act, Rules and Regulations framed there under.
6. The following guidelines relating to seniority and other criteria shall be followed for registration of LLP with ICAI.
(i) Where two similar or identical or nearly similar firm names (whether the partners of such firms are same or not) have been registered by ICAI, under the purposed LLP, only one such firm name shall be approved and remaining firm registered with ICAI, either desires to convert into LLP or not, a change in the firm name shall be required.
(ii) The name of the LLP may be like `X & Co. LLP' or `X & Associates LLP' and no other suffix shall be approved and registered by ICAI.
(iii) The newly converted CA LLPs registered with ICAI shall be allowed to work only in terms of Section 2(2) of the Chartered Accountants Act, 1949 and the object of LLP to be incorporated in Form-2 and Form 17 of the LLP rules, 2009 or in LLP agreement, shall be in the nature of Professional Services allowed under Section 2(2) of the Chartered Accountants Act, 1949. LLP shall be subject to the same regulations, as if they were in partnership firm. Mere conversion into LLP does not give any privileges, which were not earlier with the CA firms.
(iv) Inter-se seniority among the firms shall be given to LLP as per existing policy of ICAI. In other words, LLPs shall carry the same seniority, as the firm shall otherwise have under the existing policy of ICAI. In case of merger of 2 LLPs, same rules as applicable to firms merging shall apply.
(v)The non converted firms shall also remain on the same position of seniority in relation to converted LLPs as the converted LLPs shall have the same inter-se seniority as the firms had earlier to conversion.
7. These guidelines of conversion of CA firms into LLP shall also be applicable to the conversion of proprietary firm into LLP subject to the provisions of LLP Act, Rules and Regulations framed there under. The conversion of proprietary firm shall be by way of incorporation of new LLPs.
8. The registration number (with minimum 6 numbers) of LLP with ICAI, shall remain the same Firm Registration Number (FRN) allotted to the firm before the conversion by ICAI with the Regional Code like `W' for Western, `E' for Eastern, `S' for Southern, `N' for Northern and `C' for Central Region as under:-
Region Code
FRN W 1 2 3 4 5 6
FRN S 2 0 0 0 0 0
FRN E 3 0 0 0 0 0
FRN C 4 0 0 0 0 0
FRN N 5 0 0 0 0 0
9. Introduction of LLP, shall not affect the existing regulations in force as regards the name allotment to chartered accountants firms.
10. In case there is a merger of a firm and conversion with LLP and vice-versa, seniority may be provided to the surviving entity as per policy as per Annexure 'A' attached herewith.
11. The provisions of CA Act, 1949, Chartered Accountants Regulations, 1988 and Code of Ethics issued by ICAI shall be applicable to all partners of the converted CA firms into LLP jointly and severally.
12.The following Guidelines are subject to the clarification from Ministry of Corporate Affiars (MCA), Govt. of India, New Delhi:
(i) Wherever the existing partnership firm have been appointed as statutory auditor of any company after following the due procedure under the Companies Act, 1956 and the said firm with the same partners is converted/formed into LLP, then the same FRN will continue and the Board of Directors of the Company may take on record the conversion/formation of the CA firms into LLP and the new LLP shall be deemed to be an Auditor of the said company for the said financial year in terms of Section 58(4) of the LLP Act, 2008.
(ii) Wherever more than one partnership firms with all the partners desire to convert/form only one LLP, in that case the name and FRN may be selected of only one of such firms for the purpose of registration with ICAI and;
(i) The other such firms shall stand dissolved.
(ii) Seniority shall be decided as per applicable rules of ICAI.
(iii) The Board of Directors of all the Companies who have appointed all the erstwhile firms as auditors, may take a declaration from the said LLP with all the partners of all the erstwhile firms on record and the appointment of auditors of all the erstwhile firms made under the Companies Act, 1956, shall be deemed to be in the name of the said LLP.
(B) Constitution of separate LLPs
13 All members of ICAI in practice who want to constitute separate LLPs are required to follow the provisions of the Limited Liability Partnership Act, 2008 read with the Rules framed there under.
14 In terms of Rule 18(2) (xvi) of LLP Rules- 2009, if the proposed name of LLP includes the words `Chartered Accountant' or chartered Accountants, as the case may be, as part of the proposed name, the same shall be referred to the ICAI by Registrar of LLP and it shall be allowed by the Registrar only if the Secretary, ICAI approves it.
15 For the purpose of registration of LLP with ICAI under regulation 190 of the Chartered Accountants Regulations, 1988, the partners of the firm shall apply in ICAI Form No. '117' and the ICAI Form No. '18' along with copy of name registration received from the Registrar of LLP and submit the same with the concerned Regional office of the ICAI. These Forms shall contain all details of the officers and other particulars as called for together with the signatures of all partners or authorized partner of the proposed LLP.
16. The following guidelines relating to seniority and other criteria shall be followed for registration of LLP with ICAI.
(i) Inter-se seniority among the firms shall be given to LLP as per existing policy of ICAI. In other words, LLPs shall carry the same seniority, as the firms shall otherwise have under the existing policy of ICAI. In case of merger of two LLPs, same rules, as applicable to firms merging, shall apply.
(ii) The name of the LLP may be like `X & Co. LLP' or `X & Associates LLP' and no other suffix shall be approved and registered by ICAI.
(iii) The newly constituted CA LLPs registered with ICAI shall be allowed to work only in terms of Section 2(2) of the Chartered Accountants Act, 1949 and the object of LLP to be incorporated in Form-2 and Form 17 of the LLP rules, 2009 or in LLP agreement, shall be in the nature of Professional Services allowed under Section 2(2) of the Chartered Accountants Act, 1949. LLP shall be subject to the same regulation, like the partnership firms. Mere conversion into LLP does not give any privileges, which were not earlier with the CA firms.
17. These guidelines of conversion of CA firms into LLP shall also be applicable to the conversion of proprietary firm into LLP subject to the provisions of LLP Act, Rules and Regulations framed there under. The conversion of proprietary firm shall be by way of incorporation of new LLPs.
18. The registration number (with minimum 6 numbers) of LLP with ICAI, shall be like the Firm Registration Number being allotted to the firms by ICAI with the Regional Code like `W' for Western, `E' for Eastern, `S' for Southern, `N' for Northern and `C' for Central Region .
19. Introduction of LLP, shall not affect the existing regulations in force as regards Name allotment to chartered accountants firms.
20. The provisions of CA Act, 1949, Chartered Accountants Regulations, 1988 and Code of Ethics issued by ICAI shall be applicable to all partners of the LLP jointly and severally.
21. In case of any dispute in respect of these guidelines, the same shall be referred to the committee of the Institute and the decision of that committee shall be final and binding on the members of the Institute.
22. For the purpose of any clarification regarding the approval and registration of proposed LLP with the ICAI, the requests can be sent at the following address:-
The Secretary
The Institute of Chartered Accountants of India
P.B No: 7100, "ICAI Bhavan", Indraprastha Marg
New Delhi – 110002
23. These Guidelines shall come into force w.e.f. 4th November, 2011.
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