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Declaration and reporting of export value
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- Reporting compliances through the Export Declaration Form (‘EDF’) for goods and SOFTEX for software.
- EDF submitted at Customs; SOFTEX certified by STPI / SEZ.
- Service exports have no specific reporting compliances.
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Regulation 3:
- Single and unified reporting in EDF for goods and services (including software).
- Goods: File EDF at the time of export; EDF at EDI ports is deemed to be submitted as part of the shipping bill.
- Services: File EDF within 30 days from the end of the month in which the invoice is raised; a single EDF may cover all service exports for that month. For services other than software, file EDF on or before the date of receipt.
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Manner of receipt and payment
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- Full export value of goods to be paid through an AD in the manner specified in the FEM (Manner of Receipt and Payment) Regulations, as amended.
- The provision covered exports of goods only; import payments were dealt with under separate RBI directions, not under these Regulations.
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Regulation 4(1):
- Receipts and payments for export and import of goods and services to be made in the manner specified in the FEM (Manner of Receipt and Payment) Regulations, 2023, as amended.
- One unified provision for exports and imports of goods and services.
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Small-value transactions
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- Supporting documents generally required for closure of entries unless specific exceptions applied.
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- Proviso to Regulation 4(2): Where the value of the shipping bill / bill of entry / invoice is up to INR 10 lakh (or equivalent), the entry may be closed on the basis of a declaration from the exporter / importer.
- The declaration may be submitted quarterly for bulk closure of entries in the Export Data Processing and Monitoring System (‘EDPMS’) / Import Data Processing and Monitoring System (‘IDPMS’).
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Export proceeds realisation period from the date of shipment or invoice
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Generally 9 or 12 months, extended to 15 months through various circulars; different timelines for SEZ / EOU / project exports.
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Regulation 5:
- The general period for realisation and repatriation of export proceeds is 15 months for all exporters, reckoned from the date of shipment (for goods), the date of invoice (for services) or the date of sale from the warehouse (for goods sold from a warehouse).
- For project exports, the period is as per the payment terms of the contract.
- Where exports are invoiced and/or settled in Indian Rupees, the applicable period is 18 months.
- Regulation 13: If export proceeds remain unrealised beyond one year from the due date / extended period, further exports are permitted only against full advance payment or an irrevocable Letter of Credit.
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Reduction in export realisation / write-off
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- Detailed write-off provisions with multiple categories.
- Limited powers for approvals by ADs, subject to percentage caps.
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Regulation 6:
- ADs may allow reduction / non-realisation if satisfied with the reasons cited.
- Export value up to INR 10 lakh per invoice may be closed on the basis of a declaration by the exporter.
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Set-off of export receivables against import payables
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- Permitted in a restrictive manner and subject to multiple conditions.
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Regulation 7:
ADs are empowered to permit set-off with the same overseas buyer or supplier, or their overseas group or associate companies, within the prescribed / approved period for export realisation.
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Third-party payment
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- Permitted in a restrictive manner and subject to multiple conditions.
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Regulation 8:
Permitted under AD powers, subject to the transaction being genuine and supported by documentary evidence.
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Import payment settlement
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- 6 months for normal imports from the date of shipment.
- Different timelines for import of capital goods, etc.
- Extensions allowed by AD on a case-to-case basis.
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Regulation 9:
- Import payment terms aligned with the period specified in the underlying contract.
- AD Banks may approve extensions if satisfied with the reasons cited.
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Receipt of advance against exports
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- Advance receipts had a 3-year shipment requirement.
- Interest caps applied (LIBOR / any other widely accepted rate + 200 bps).
- Extensive follow-up / reporting requirements were placed on exporters.
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- Regulation 10: In the case of both imports and exports, the advance amount and the realisation of proceeds, if any, shall be routed through the same AD. However, an exporter / importer may route the transactions through any other AD, provided the exporter / importer has intimated the change to both ADs.
- ADs are empowered to set internal thresholds for advances and to mandate a Standby Letter of Credit (‘SBLC’) / Bank Guarantee (‘BG’).
- Interest not to exceed the all-in-cost ceiling for trade credit.
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Advance import payment
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- Where the advance exceeded USD 2,00,000 (or its equivalent), it was allowed with a BG / SBLC.
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- Generally permitted. No specific threshold is prescribed; the matter is left to the monitoring / powers of the AD Bank.
- Regulation 11: No advance remittance is allowed for import of gold or silver.
- Regulation 12: If the import is not completed within the prescribed period, any advance paid must be repatriated.
- If the advance is not repatriated or the IDPMS entry is not closed, future import advances will require an SBLC or BG.
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Project exports
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- Project exports (exports of engineering goods on deferred payment terms, execution of turnkey projects / civil construction contracts abroad, etc.) were governed separately under the Memorandum of Instructions on Project and Service Exports (‘PEM Rules’).
- AD / EXIM Bank approval was required at the post-award stage.
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Regulation 15:
- Transactions must be supported by contracts and are subject to verification of genuineness by the AD Bank before receipts / payments for such projects are permitted.
- If permitted by the AD, a project exporter may deploy temporary cash surplus generated outside India from such exports for investment in short-term instruments (with original or residual maturity of one year or less), including treasury bills and deposits with banks, outside India.
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Merchanting Trade Transactions (‘MTT’)
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- Detailed and complex framework for MTT.
- Entire MTT to be completed within 9 months.
- Foreign exchange outlay not exceeding 6 months.
- Third-party payments restricted.
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Regulation 16:
- Overall simpler framework; ADs are empowered to set internal guidelines.
- The period between the outward and inward remittances (or vice versa) must not exceed 6 months.
- AD Banks must verify genuineness and ensure EDPMS / IDPMS reporting.
- Allows third-party receipts / payments with AD Bank approval.
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International Trade Invoicing and INR trade settlement
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Allowed via a series of circulars introducing the Special Rupee Vostro mechanism.
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Regulation 17:
The AD may be guided by the extant RBI guidelines on the broad framework.
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Reporting requirements
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- EDPMS / IDPMS existed, but the rules were spread over multiple circulars.
- AD Banks uploaded documents, but there was no uniform statutory time limit.
- Small-value closures required supporting documents unless exceptions applied.
- Foreign Exchange Transactions – Electronic Reporting System (‘FETERS’) reporting was separate and manual in many cases.
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Regulation 18:
- Unifies reporting requirements for export and import transactions: all export / import transactions, including project / service exports, must be reported in FETERS and EDPMS.
- AD Banks must upload documents in EDPMS / IDPMS within 5 working days of receipt.
- Small-value entries (INR 10 lakh or below) can be closed on the basis of a simple exporter / importer declaration; no supporting documents are required.
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