RBI
Approval Requires for Opening and Maintaining Rupee Vostro
Account in India of Non Resident Exchange Houses in Connection with RDAs
[RBI
Circular No. 72 dated 30th January 2012]
Sub:
Memorandum of Instructions for Opening
and Maintenance of Rupee / Foreign Currency Vostro
Accounts of Non-resident Exchange Houses
Attention of Authorised Dealer Category – I (AD
Category – I) banks is invited to the Paragraph nos. (A) (1) and (A) (3) (ix)
of Annex-I to the A.P.(DIR Series) Circular No. 28 [A.P.
(FL/RL Series) Circular No. 02] dated February 6, 2008 on Memorandum of
Instructions for Opening and Maintenance of Rupee / Foreign Currency Vostro Accounts of Non-resident Exchange Houses and
subsequent amendments thereto in terms of which prior approval of the Reserve
Bank is required for opening and maintaining rupee vostro
accounts of non-resident Exchange Houses.
2. With a view to
give more operational leeway to the AD Category-I banks, it has been decided to
dispense with the requirement of prior approval of the Reserve Bank for opening
and maintaining each Rupee Vostro account in India of
non-resident Exchange Houses in connection with the Rupee Drawing Arrangements
(RDAs) that banks enter into with them. Accordingly, AD Category-I banks may
take approval of the Reserve Bank the first time they enter into the above
arrangement with non-resident Exchange Houses from Gulf countries, Hong Kong,
Singapore and Malaysia. Subsequently, they may enter into RDAs, subject to the
prescribed guidelines and inform the Reserve Bank immediately.
3. Once the total
number of Rupee Drawing Arrangements (RDAs) reaches twenty, the AD Category-I
bank may cause a detailed external Audit of their internal system to ensure
that it is working satisfactorily. Based on the satisfactory report, the Board
of AD Category-I banks may authorise more such arrangements. A copy of the
Board Note together with Board Resolution in the matter may be filed with the
Reserve Bank and new arrangements informed to the Reserve Bank as indicated in
Para 2.
4. All other
instructions contained in the A.P.(DIR Series)
Circular No. 28 [A.P. (FL/RL Series) Circular No. 02] dated February 6, 2008,
as amended from time to time, remain unchanged.
5. AD Category-I
banks may bring the contents of this circular to the notice of their
constituents concerned.
6. The directions contained in this circular have
been issued under Sections 10(4) and 11(1) of the Foreign Exchange Management
Act, 1999 (42 of 1999) and are without prejudice to permissions / approvals, if
any, required under any other law.