DIFFERENCE BETWEEN FERA AND FEMA PDF

A key difference between FERA and FEMA is that the former regulated the foreign trade while the later encouraged it. DIFFERENCES. CHANGES / PROGRESSION FROM FERA TO FEMA – A STEP AHEAD. Similarities. The similarities between FERA and FEMA are as follows. Difference between FERA and FEMA (Foreign Exchange Regulation Act and Foreign Exchange Management Act). Article shared by. FERA (Foreign Exchange.

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It promotes more liberal form of economy. Difference between Plant Vacuole and Animal Vacuole. Contravening the provision of FERA may result in imprisonment. The Foreign Exchange Management Act is an extension of the earlier foreign exchange regulation act. Betwesn, all the citizens of the country, inside or outside India are covered under this act.

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New Challenges before the Monetary Authority of India. Conversely, the punishment for violating gera provisions of FEMA is a monetary penalty, which may turn into imprisonment if the fine is not paid on time. Provisions of Foreign Exchange Management Act. It came into force on June 1, It was formulated and implemented to increase efficiency and effectiveness in the foreign exchange market. It introduced resident ship in place of citizenship.

FERA did not contain any express provision on the right of on impleaded person to take legal assistance. It extends to the whole of India. Imprisonment is prescribed between when one fails to pay the penalty. This act is a civil law and the contraventions of the Act provide for arrest only in exceptional cases.

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Main Features of the Foreign Exchange Management Act (FEMA)

This activity directly referred into the capacities of multi national businesses working in India. FEMA do not view outflow of foreign exchange as an evil act however it rather works to factor it out to manage the process of foreign exchange.

Other notable differences between the two acts include an approach to forex, violation, and punishment, the basis for residential status, and purpose among others.

FEMA an act initiated to facilitate external trade and payments and to promote orderly management of the forex market in the country. Check out this article to know more differences between the two acts.

Main Features of the Foreign Exchange Management Act (FEMA)

Leave a Reply Click here to cancel reply. A person has to obtain permission of RBI with regard to transfer of funds related to external operations. On one opposite element, the FEMA is made for that primary intention of aiding the surface trade along with capital.

You agree that we have no liability for any dera. You Might Also Like: Some of them are restrictive, and some has widened the scope. But FEMA makes offences relating to foreign civil offences. Comments helpful for my mba exam thanks….

The Scope and Objective of FEMA was mainly to amend the laws related to foreign exchangeto facilitate external trade and payments and to develop the foreign exchange market in India. The leading aim of this FERA that can be mostly known as the Foreign Exchange Regulation Act FERA would be to protect and also expectancy of out-flow of foreign alternative like a consequence of existence of this adverse association of overseas alternative equilibrium contained in India. However, the Central Government may, in public interest in consultation with the Reserve Bank impose such reasonable restrictions for current account transactions as may be prescribed.

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The definition of Authorized person has been widened to include banks, money changes, off shore banking Units etc. The main involving those 2 terminologies is the main aim as FERA has been manufactured in a bid to guard and forestall abuse of overseas alternative. Fine or imprisonment if the person does not deposit the prescribed penalty within 90 days from the date of conviction. Presumption of extra territorial jurisdiction as envisaged in section 1 of FERA has been retained.

Article 3: Finance- FERA versus FEMA –

How to Prepare for your CA Exams? It applies to all branches, offices and agencies outside India owned or controlled by a person, who is a resident of India and also to any contravention there under committed outside India by two people whom this Act applies.

FERA was set betwene with main objective of conservation of foreign exchange however FEMA was set up with main objective of management of foreign exchange.

It aims to manage foreign exchange more efficiently rather than conserving it.