RBI Relaxes Merchanting Trade regulations to make them more flexible

• Revision: Merchanting Trade Transactions Norms (MTT) revised.

Key Changes:

• The time frame of the foreign exchange outlay has been stretched to a 6 month period.
• The total time of completing transactions is 9 months between the initial and final leg.
• Effective Date: Immediate; pursuant to Sections 10(4) and 11(1) of FEMA, 1999.
• Purpose: To offer operational things to Indian traders who involve themselves in MTT, where goods flow among foreign entities, without having to enter India.

RBI Relaxes the laws on small exporters-importers.

• Revision: EDPMS (Export Data Processing and Monitoring System) and IDPMS(Import Data Processing and Monitoring System) procedures revised.

Key Changes:

• AD Category-I banks can close transactions up to 10 lakh per bill/entry on self-declaration by exporters (receipt) or importers (payment).
• Bulk reconciliation of small-value entries QUDs could be processed via bulk reconciliation of numerous quarterly consolidated declarations.
• Effective Date: Immediate, to be contained in new Master Directions on Export and Import of Goods and Services, under FEMA, 1999.
• Aim: To make compliance easier to small exporters/ importers.