RBI brings uniformity to the Late Submission Fee (LSF)

Circular No. A.P. (DIR Series) Circular No. 16, Dated 30-09-2022

The reporting delays under the FEMA can be regularised on the submission of the Late Submission Fee (LSF). Before the amendment, different methodologies existed for the calculation of LSF to be paid for various reporting delays. RBI has now decided to bring uniformity in the imposition of LSF across functions. A uniform fee is to be paid for various delays in reporting.

1. How to calculate Late Submission Fee (LSF)?

The following matrix shall be used henceforth for the calculation of LSF, wherever applicable –

(a) LSF Amount shall be calculated at Rs. 7500/- per return for the following types of Reporting Delays –

• • • • Form ODI Part-II/ APR,
      • FCGPR (B),
      • FLA Returns,
      • Form OPI,
      • evidence of investment or any other return which does not capture flows or any other periodical reporting

(b) LSF Amount shall be calculated at Rs. 7,500+(0.025% *amount involved in the delayed reporting* the number of years of delay in submission) for the following types of reporting Delays –

• • • • Form FC-GPR, FCTRS, Form ESOP,
      • Form LLP(I), Form LLP(II),
      • Form CN,
      • Form DI,
      • Form InVi,
      • Form ODI-Part I, Form ODI-Part III, Form FC,
      • Form ECB, Form ECB-2, Revised Form ECB or any other return which captures flows or returns which capture reporting of non-fund transactions or any other transactional reporting

Further, the number of years of delay in submission would be rounded upwards to the nearest month and expressed up to 2 decimal points.

2. LSF amount is to be calculated per return

The LSF amount is calculated based on delay in filing per return. However, for any number of Form ECB-2 returns, delayed submission for each LRN will be treated as one instance for the fixed component.

Further, the amount involved in the delayed reporting for any ECB-2 return will be the gross inflow or outflow (including interest and other charges), whichever is more.

3. What is the maximum limit up to which LSF can be levied?

As per the RBI’s circular, the maximum LSF amount cannot exceed the amount involved in the delayed reporting.

Further, in the case of the fractional amount, the same will be rounded upwards to the nearest hundred.

4. What is the timeline to opt for LSF?

The facility for opting for LSF shall be available up to 3 years from the due date of reporting/ submission. The option of LSF shall also be available for delayed reporting/submissions under the Foreign Exchange Management (Transfer or Issue of any Foreign Security) Regulations, 2004 and earlier corresponding regulations, up to three years from the date of notification of Foreign Exchange Management (Overseas Investment) Regulations, 2022 (i.e. 22-08-2022).

5. What are the consequences of failing to pay LSF?

In case a person responsible for any submission or filing under the provisions of FEMA, neither makes such submission/filing within the specified time nor makes such submission/filing along with LSF, such person shall be liable for penal action under the provisions of FEMA, 1999.

Also, where an advice has been issued for payment of LSF by the authority and such LSF is not paid within 30 days, such advice shall be considered as null and void and any LSF received beyond this period shall not be accepted. If the applicant subsequently approaches for payment of LSF for the same delayed reporting, the date of receipt of such application shall be treated as the reference date for the purpose of calculating the number of years of delay in submission.

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