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In which year was the Foreign Exchange Management Act (FEMA) enacted to replace the Foreign Exchange Regulation Act (FERA)?

In which year was the Foreign Exchange Management Act (FEMA) enacted to replace the Foreign Exchange Regulation Act (FERA)? Correct Answer 1999

The correct answer is 1999.

Important Points

  • FERA was replaced by FEMA in 1998 by the Government of Atal Bihari Vajpayee.
  • FEMA was passed in the winter session of Parliament on 29th December 1999.
  • Foreign Exchange Regulations Act (FERA) is an act that imposes strict regulations on:
    • Foreign exchange dealings,
    • Securities and transactions have an indirect impact on foreign exchange
    • Import and export of foreign currency
    • On conservation and optimal utilization of foreign exchange so as to promote economic development and growth
    • Certain kinds of payment in foreign currency.
  • FERA was passed in India in the year 1973 and it came into effect on 1st January 1974.
  • Foreign Exchange Management Act (FEMA) is the act of the Parliament of India:
    • To amend and consolidate regulations and laws related to foreign exchange.
    • To facilitate external trade and payments for promoting orderly maintenance.
    • To develop foreign exchange markets in India.
    • FEMA paved the way for the introduction of the Prevention of Money Act, 2002 which became effective on 1st July 2005.
    • FEMA acts as a regulatory mechanism enabling the Reserve Bank of India (RBI) and the Central Government to pass rules related to Foreign exchange as per the Foreign Trade Policy of India.

Related Questions

Assertion (A): Under FEMA, the receiver of laundered money is to be made culpable, instead of sender/distributor.
Reason (R): FEMA differs from the earlier Exchange Regulation Act FERA with regard to penalties and punishment in case of violation of the act.
Two statements are followed by two Conclusions I and II. You have to consider the statements to be true, even if they seem to be at variance from commonly known facts. You are to decide which of the given conclusions can definitely be drawn from the given statements and indicate your answer accordingly. Statements: I. The Enforcement Directorate (ED) has sought information on offshore investments by directors of RNT Associates, a closely held firm which functions as a family office and investment vehicle of Ratan Tata.  II. The ED order, dated June 14, also calls for details of investments or loans from RNT Associates and its directors to a Singapore-based entity, RNT Associates Ltd. Conclusions: The order is under provisions of the Foreign Exchange Management Act (FEMA) and the documents are being sought for the purpose of investigation under FEMA. The nature of queries from Enforcement Directorate is related to RNT Associates’ investment portfolio. It is compliant with all disclosures and existing laws governing investments and is extending all cooperation.
Assertion (A): Reserve Bank of India is an important regulatory and administrative authority to execute FEMA provisions. Reason (R): Being monetary authority and custodian of foreign exchange, Reserve bank of India enjoys requisite expertise of FEMA administration. In the context of the above two statements, which one of the following option is correct?
Assertion (A): Reserve Bank of India is an important regulatory and administrative authority to execute FEMA provisions.
Reason (R): Being monetary authority and custodian of foreign exchange, Reserve Bank of India enjoys requisite expertise of FEMA administration.
In the context of the above two statements, which one of the following option is correct?
Foreign Exchange Regulation Act was replaced with The Foreign Exchange Management Act in the year.
Under foreign exchange risk measurement, economic risk emerges out of which of the following?
1. Riskiness of company's foreign exchange positions resulting from its business activities.
2. The holding period or length of time over which the foreign exchange position is planned to be held.
3. A change in the present value of the future after tax cash flows due to changes in exchange rates.
4. The unit of currency to be used for the denomination of the value of currency.
The Foreign Exchange Management Act(FEMA) was passed in:
When was Foreign Exchange Management Act (FEMA) passed by parliament of India?
In November 2017, RBI simplified ‘FEMA’ by putting all amendments under one notification. What does ‘E’ stand for in ‘FEMA’
In November 2017, RBI simplified FEMA by putting all amendments under one notification. What does E stand for in FEMA?