RBI relaxes third party import export payment
Updated: Feb 04, 2014 04:57:44pm
Mumbai, Feb 4 (KNN) The Reserve Bank of India (RBI) today relaxed rules governing third party payments for export and import transactions through authorized foreign exchange dealer. Under the liberalized rule, the limit of USD 100 thousand to be eligible for third party payment for import of goods stands withdrawn.
Besides, in view of the difficulties faced by exporters / importers in meeting the condition “firm irrevocable order backed by a tripartite agreement should be in place” specified in the above mentioned Circular, it has been decided that this requirement may not be insisted upon in case where documentary evidence for circumstances leading to third party payments / name of the third party being mentioned in the irrevocable order/ invoice has been produced.
Earlier on November-8, RBI had allowed third party payments for export/import transactions subject to certain conditions.
The notification had said, “Firm irrevocable order backed by a tripartite agreement should be in place.”
Further, the same RBI notification said, third party payment should come from a Financial Action Task Force (FATF) compliant country and through the banking channel only.
Normally payment for exports has to be received from the overseas buyer named in the Export Declaration Form (EDF) by the exporter and the payment shall be received in a currency appropriate to the place of final destination as mentioned in the EDF irrespective of the country of residence of the buyer.
Similarly, payments for the import should be made to the original overseas seller of the goods, the apex bank added. (KNN/SD)
Besides, in view of the difficulties faced by exporters / importers in meeting the condition “firm irrevocable order backed by a tripartite agreement should be in place” specified in the above mentioned Circular, it has been decided that this requirement may not be insisted upon in case where documentary evidence for circumstances leading to third party payments / name of the third party being mentioned in the irrevocable order/ invoice has been produced.
Earlier on November-8, RBI had allowed third party payments for export/import transactions subject to certain conditions.
The notification had said, “Firm irrevocable order backed by a tripartite agreement should be in place.”
Further, the same RBI notification said, third party payment should come from a Financial Action Task Force (FATF) compliant country and through the banking channel only.
Normally payment for exports has to be received from the overseas buyer named in the Export Declaration Form (EDF) by the exporter and the payment shall be received in a currency appropriate to the place of final destination as mentioned in the EDF irrespective of the country of residence of the buyer.
Similarly, payments for the import should be made to the original overseas seller of the goods, the apex bank added. (KNN/SD)
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