In order to regulate foreign exchange transactions both within and outside of India, the Indian government established the Foreign Exchange Management Act of 1999 (FEMA). As India's foreign exchange reserves have grown, so too have the compliance requirements. To engage in services outside of India, both Indian and international companies as well as individuals must adhere to the foreign exchange regulations established under FEMA. Failure to comply with these regulations may result in penalties and hinder the effectiveness of foreign exchange transactions within and outside of India, as well as limit the ability of businesses to provide services outside of India.
Need for Compliance under FEMA
- Relevant foreign exchange laws are enforced through FEMA regulations to ensure businesses comply with them.
- Entities established in India will be monitored by FEMA for their business dealings abroad.
- Compliance with FEMA regulations can facilitate smooth operations for businesses outside of India.
- Compliance with foreign exchange regulations under FEMA allows foreign companies to establish offices in India.
Types of services we offer
How we help
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Initial Consultation:
- Consultation: We initiate the process with an initial consultation with you.
- Analysis of Business: During the consultation, we analyze your business and its foreign exchange transactions.
- Identification of Areas: This helps us identify the areas where you may require assistance with FEMA compliance
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Compliance Audit:
- Compliance Audit: We perform a compliance audit to evaluate your compliance with FEMA regulations.
- Review of Documentation: This audit includes a review of your documentation to ensure that it meets the regulatory requirements.
- Procedures and Transactions Evaluation: We also evaluate your procedures and transactions to ensure compliance with the FEMA regulations.
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Compliance Strategy:
- Compliance Plan Creation: Based on the compliance audit results, we create a compliance plan for your business.
- Customized to Your Business: This plan is customized to meet the specific needs of your business.
- Actionable Steps: The compliance plan includes a set of actionable steps that are required for achieving compliance with the FEMA regulations.
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Documentation Assistance:
- Documentation Preparation: Our team assists you in preparing the necessary documentation required for FEMA compliance.
- Transaction Documentation: This includes documentation related to your foreign exchange transactions.
- pproval and Reporting Support: We also help you maintain the documentation required for approvals and reporting to ensure compliance with FEMA regulations.
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Transaction Review:
- Foreign Exchange Transaction Assessment: Our team assesses your foreign exchange transactions for compliance with FEMA regulations.
- Transaction Documentation Review: This assessment includes a review of your transaction documentation.
- Procedure Examination: We also examine your transaction procedures to ensure compliance with FEMA regulations.
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Compliance Reporting:
- Assessment: We assess your compliance reporting requirements for the Reserve Bank of India (RBI), based on your business activities.
- Report Preparation: We help you prepare the necessary compliance reports for the RBI, including reports related to foreign exchange transactions, remittances, and investments.
- Timely Filing: We assist you in filing the compliance reports accurately and on time, to avoid penalties or sanctions for non-compliance.
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Ongoing Compliance Support:
- Compliance Review: We conduct regular reviews of your business's compliance procedures to ensure ongoing adherence to FEMA (Foreign Exchange Management Act) regulations.
- Regulatory Updates: We keep you informed of any changes to the FEMA
Our goal is to help you achieve and maintain compliance with FEMA regulations. We understand that compliance can be complex, and our team of experts is here to help you every step of the way.
Applicability
Money Transfer Services:
Any person or entity providing money transfer services for foreign exchange transactions must comply with FEMA regulations, which include reporting and documentation requirements..
Foreign Investment Services:
Any entity providing foreign investment services, such as advising on investments or managing investment portfolios, must comply with FEMA regulations related to capital account transactions.
Forex Trading Services:
Forex trading service providers must comply with FEMA regulations related to foreign exchange transactions, which includes obtaining necessary approvals from the Reserve Bank of India (RBI) and maintaining proper records.
Travel Services:
Travel service providers must comply with FEMA regulations related to foreign exchange transactions, which include reporting requirements for foreign exchange transactions related to travel.
Payment Gateway Services:
Payment gateway service providers must comply with FEMA regulations related to foreign exchange transactions, including obtaining necessary RBI approvals and maintaining proper records.
Import-Export Services:
Any person or entity involved in import-export services must comply with FEMA regulations related to foreign exchange transactions, which includes obtaining necessary approvals from the RBI and maintaining proper records.
Overall, FEMA is a critical law for regulating foreign exchange transactions in India and ensuring compliance with the relevant regulations.
MMA Approach
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3500+
Projects completed
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100+
Satisfied Clients
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10+
Years of Experience
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Expertise in complex financial areas:
Our team has deep expertise in complex financial areas such as FEMA Compliance, Transfer Pricing, Business Valuation, ESOPs, and Internal Audit.
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Comprehensive financial services:
We offer a range of integrated tax, audit, and business advisory services to provide comprehensive solutions that consider all aspects of your financial situation.
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Personalized service:
We take the time to understand your unique needs and goals and provide tailored service that meets your specific situation.
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Commitment to quality:
We are committed to delivering the highest quality services to our clients, and we use the latest technology and tools to ensure accuracy and efficiency in our work.
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Experienced professionals:
Our team of professionals undergoes rigorous training and adheres to the highest standards of professionalism and integrity.
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Proactive approach:
We take a proactive approach to financial planning and offer guidance and advice that helps our clients achieve their goals.
Kpis To Measure The Service Quality
Costs
- Actual vs. budget costs.
- Budget needed for completion vs. budget remaining
Team Productivity
- Lead time and Cycle time.
- Team Velocity
- Deployment frequency
- Time spent vs. time planned (for iteracions or implementation of partic features)
Customer Involvement
- Time spent by a customer's employees fulfiling a vendor's requests
- Time of delays with requirements elicitation sessions on the customer’s side
User Satisfaction
- Overall customer satisfaction score
- The team's proactivity (problem-solving Skills, ability to give advice)
- The team's reliability (fulfilment of promises)
- The team's responsiveness (including availability)
MMA FEMA Service - Q&A
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Who needs to comply with FEMA regulations in India?
Any entity or person who engages in foreign exchange dealings, including importers, exporters, foreign investors, and individuals making foreign travel payments, is required to comply with FEMA regulations.
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What are the consequences of non-compliance with FEMA regulations?
Non-compliance with FEMA regulations can lead to penalties, fines, imprisonment, freezing of bank accounts, confiscation of assets, and reputational damage to businesses.
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How can MMA help with FEMA compliance?
MMA provides guidance on regulations, conducts compliance audits, and assists with filing necessary documents and reports with the Reserve Bank of India (RBI) to help businesses comply with FEMA regulations.
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What are the key areas of FEMA compliance that MMA can assist with?
MMA can provide assistance with various aspects of FEMA compliance, such as the Establishment of a Foreign Office in India, Foreign Direct Investment under Automatic and Approval Routes, FEMA Advisory for expatriates, ECB Compliance Advisory, Acquisition-Of-Immovable-Property, Loan to and from NRIs, NRI Investment FEMA Compliance and Overseas Direct Investment.
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How can MMA assist with FEMA-related legal issues?
In the case of any legal issues related to FEMA compliance, MMA provides legal advisory services and represents businesses in legal proceedings.
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What is the fee structure for FEMA-related services provided by MMA?
The fee charged by MMA FEMA-related services varies based on the complexity and scope of the services required. The fees are usually charged on a project basis or hourly basis and can vary based on the size and nature of the business.
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Can I repatriate funds from my foreign investments back to India?
Yes, you can repatriate funds from your foreign investments back to India subject to compliance with FEMA regulations.
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Can I hold foreign currency in India?
Yes, Indian residents are allowed to hold foreign currency in India, subject to the limits prescribed under FEMA regulations.
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What is the penalty for unauthorized retention of foreign currency?
The penalty for unauthorized retention of foreign currency can range from a fine to imprisonment, depending on the amount of foreign currency involved and the nature of the violation.
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What is the procedure for repatriation of funds from India?
The procedure for repatriation of funds from India involves obtaining necessary approvals from the RBI, filing returns, and complying with all other applicable regulations.
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Can I open a foreign currency account in India?
Yes, Indian residents are allowed to open foreign currency accounts in India, subject to the limits prescribed under FEMA regulations.
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What is the limit for opening a foreign currency account in India?
The limit for opening a foreign currency account in India is USD 1 million per financial year.
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Can I use funds from my foreign currency account for local transactions in India?
No, funds from foreign currency accounts cannot be used for local transactions in India.
