Annual Return on Foreign Liabilities and Assets (FLA)

Who shall submit FLA Return:

• Companies incorporated under the Companies Act, 2013 or any previous law.
• Insurance companies (subject to Insurance Act, 1938 and IRDA Act, 1999).
• Banking companies (subject to Banking Regulation Act, 1949).
• Electricity companies (subject to Electricity Act, 2003).
• Other companies governed by special Acts.
• Body corporates specified by the Central Government.
• Limited Liability Partnerships.
• Others (including AIFs, Registered Partnership Firms, PPPs).

Due Date for Filing FLA Annual Return:

Deadline:

The FLA annual return must be filed before July 15th of the respective year.

Data Inclusion:

The return must include details of Foreign Direct Investment (FDI) received or Overseas Direct Investment (ODI) made by the company in the previous and current years.

Unaudited Accounts:

• If audited accounts are not available by July 15th, the company must file the return based on unaudited accounts.
• A subsequent amended return must be filed with updated details based on the audited accounts before September 30th of the same year.

Failure to File Foreign Liabilities Accounts (FLA) Return:

Initial Penalty:

Thrice the sum involved in the contravention. If the sum is not quantifiable, a Rs 200,000 penalty applies.

Continuing Penalty:

Rs 5,000 per day for each day the contravention continues.

Compounding of Offenses

Regional Offices:

Most RBI regional offices have the authority to compound contraventions without any limit.

Exceptions

This authority does not extend to the Kochi and Panaji regional offices.

Documents:

Foreign Direct Investment (FDI) and Overseas Direct Investment (ODI) are increasingly crucial aspects of global business. To ensure compliance with India's foreign exchange regulations, companies engaging in these activities must adhere to the Foreign Exchange Management Act (FEMA). A key aspect of this compliance is the filing of the Foreign Liabilities and Assets (FLA) Annual Return. This mandatory return, submitted directly to the Reserve Bank of India (RBI), provides a comprehensive overview of all foreign investments made by or into the company, encompassing both FDI and ODI transactions.

Considerations:

Foreign Direct Investment (FDI) and Overseas Direct Investment (ODI) are increasingly crucial aspects of global business. To ensure compliance with India's foreign exchange regulations, companies engaging in these activities must adhere to the Foreign Exchange Management Act (FEMA). A key aspect of this compliance is the filing of the Foreign Liabilities and Assets (FLA) Annual Return. This mandatory return, submitted directly to the Reserve Bank of India (RBI), provides a comprehensive overview of all foreign investments made by or into the company, encompassing both FDI and ODI transactions.