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CS Executive · Setting Up of Business, Industrial and Labour Laws · Financial Services Organization

Which combination correctly describes the common drafting feature of the IFSC provisions in the Insurance Act, 1938 (s.118A), the Banking Regulation Act, 1949 (s.51A) and the RBI Act, 1934 (s.57A)?

Each provision says the original regulator's powers do not extend to an IFSC set up under section 18(1) of the Special Economic Zones Act, 2005, and are instead exercisable by the IFSCA, limited to financial products, services and institutions permitted in the IFSC.

  1. AEach makes the IFSC subject to the original regulator unless the Central Government notifies otherwise
  2. BEach ends the regulator's powers across India and transfers them wholly to the IFSCA
  3. CEach refers to an IFSC set up under section 18(1) of the Special Economic Zones Act, 2005 and transfers the regulator's powers to the IFSCA only for permitted products, services and institutionsCorrect
  4. DEach requires IFSC units to obtain a licence from both the original regulator and the IFSCA

Explanation

All three sections begin with 'notwithstanding anything contained in any other law', say the regulator's powers shall not extend to an IFSC set up under section 18(1) of the SEZ Act, 2005, and make them exercisable by the IFSCA for permitted products, services and institutions. Option B overstates the scope; options A and D add conditions not in the text.

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