Sunday, 28 December 2014

RBI November 2014

Notification/Circular no. Date Subject Amendment
RBI/2014-15/296
DCBR.CO.BPD .(PCB). No 1/14.01.062/2014-15

November 05, 2014 Designated Director – Amendment to Section 13(2) of Prevention of Money Laundering Act (PMLA) In an earlier circular, UCBs were advised that they may nominate a Director on their Boards as ‘Designated Director’ to ensure compliance with the obligations under the Prevention of Money Laundering Amendment Act, 2012. In this connection, it is clarified that UCBs can also designate a person who holds the position of senior management or equivalent as a ‘Designated Director’. However, in no case, the Principal Officer should be nominated as the ‘Designated Director’.
RBI/2014-15/299
DNBR (PD) CC.No. 002/03.10.001/2014-15
November 10, 2014 Revised Regulatory Framework for NBFC With an intent to review the entire regulatory framework for the NBFC sector over time, certain changes to the regulatory framework are sought to be made to a) address risks wherever they exist, b) address regulatory gaps and arbitrage arising from differential regulations, both within the sector as well as vis-a-vis other financial institutions, c) harmonise and simplify regulations to facilitate a smoother compliance culture among NBFCs, and d) strengthen governance standards. In doing so, certain important recommendations made by the Working Group on Issues and Concerns in the NBFC Sector (Chairperson: Smt. Usha Thorat) and the Committee on Comprehensive Financial Services for Small Businesses and Low Income Households (Chairman: Dr. Nachiket Mor), have been drawn upon. The changes now introduced to the regulatory framework are delineated in the said circular.
RBI/2014-15/300
DNBR (PD) CC.No. 003/22.10.91/2014-15
November 10, 2014 Review of the Non-Banking Financial Company – Factors (Reserve Bank) Directions, 2012  It has been decided that an NBFC for registering as NBFC-Factor shall ensure that its financial assets in the factoring business constitute at least 50 per cent of its total assets and its income derived from factoring business is not less than 50 per cent of its gross income.
FEMA.326/RB-2014 November 12, 2014 Foreign Exchange Management (Transfer or Issue of any Foreign Security) (Fifth Amendment) Regulations, 2014 The Reserve Bank of India has amended the Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations, 2004
RBI/2014-15/307
A.P. (DIR Series) Circular No. 38
November 20, 2014 Acquisition/Transfer of Immovable property – Payment of taxes It has been observed that doubts persist regarding requirement of payment of taxes while undertaking property transactions under Foreign Exchange Management (Acquisition and Transfer of immovable property in India) Regulations, 2000. In this connection, it is clarified that transactions involving acquisition of immovable property under these regulations shall be subject to the applicable tax laws in India.
FEMA.327/RB-2014 November 24, 2014

Foreign Exchange Management (Deposit) (Amendment) Regulations, 2014 The Reserve bank of India has further amended the Foreign Exchange Management (Deposit) Regulations, 2000
RBI/2014-15/316
A.P. (DIR Series) Circular No. 41
November 25, 2014 Routing of funds raised abroad to India It has come to our notice that some Indian companies are accessing overseas market for debt funds through overseas holding / associate / subsidiary / group companies. It has also been reported that such borrowings are raised at rates exceeding the ceiling applicable in terms of extant FEMA regulations and that the funds so raised are routed to the Indian companies which accounts for sole/major operations of the group. Different modalities/structures are resorted to for channeling such funds for Indian operations including investment in rupee bonds floated by the Indian company. On review of the matter in light of the existing regulatory framework, certain clarifications in this regard has been issued by the Reserve Bank of India.
RBI/2014-15/323
DCBR.BPD.(PCB).Cir No.3/12.05.001/2014-15
November 27, 2014 Supervisory Action Framework for Urban Co-operative Banks (UCBs) Supervisory Action Framework (SAF) for UCBs was introduced. Having regard to the improvements witnessed by the sector and the need for ensuring more timely supervisory responses, it has been decided to review and revise the supervisory action framework. The main features of this revision are as indicated in the said circular.
_____ November 27, 2014 Guidelines for Licensing of Payments Banks The Reserve Bank of India has released Guidelines for Licensing of payment banks with an objective to increase financial inclusion by providing small savings account and remittance services to migrant labour workforce, low income households, small businesses etc. The eligibility criteria, scope of activities and other such conditions relating to payment banks are outlined in the said guidelines.  
_____ November 27, 2014 Guidelines for Licensing of Small Finance Banks in the Private Sector The Reserve Bank of India has released Guidelines for Licensing of Small Finance Banks in the Private Sector with an objective of setting up small finance banks. The eligibility criteria, scope of activities and other such conditions are contained in the said guidelines. 

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