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CA Intermediate · Corporate and Other Laws · The Foreign Exchange Management Act, 1999

Mr. Arjun, a person resident in India, wants to know who is considered an 'authorised person' to deal in foreign exchange. Which of the following correctly states the position under FEMA, 1999?

An authorised person means an authorised dealer, money changer, offshore banking unit or any other person authorised by the Reserve Bank of India to deal in foreign exchange or foreign securities. Mere company registration or professional certification does not confer this status.

  1. AAny registered company can deal in foreign exchange once it files a return with the Registrar
  2. BAn authorised dealer, money changer, off-shore banking unit or other person authorised by the RBI to deal in foreign exchange or foreign securitiesCorrect
  3. COnly the Central Government and its departments
  4. DAny Chartered Accountant certifying the transaction

Explanation

FEMA defines authorised person as an authorised dealer, money changer, offshore banking unit or any other person authorised by the RBI to deal in foreign exchange or foreign securities. Registration as a company or certification by a professional gives no such authority.

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