MANU/APDR/0019/2021
Ministry : Reserve Bank of India
Department/Board : Financial Markets Regulation Department
Circular No. : A. P. (DIR Series) Circular No. 13
RBI/2021-2022/101
Date : 28.09.2021
Notification/ Circulars Referred : FEMA 23(R)/2015-RB dated January 12, 2016 MANU/RFEM/0004/2016;Notification No. FEMA 23(R)/(5)/2021-RB dated September 08, 2021 MANU/RFEM/0003/2021
Subject: Banking
Industry: Finance
Citing Reference:
FEMA 23(R)/2015-RB dated January 12, 2016 MANU/RFEM/0004/2016 Referred
Notification No. FEMA 23(R)/(5)/2021-RB dated September 08, 2021 MANU/RFEM/0003/2021 Referred
To
All Category-I Authorised Dealer Banks
Use of any alternative reference rate in place of LIBOR for interest payable in respect of export / import transactions
Attention of Authorised Dealer Category- I banks (AD banks) is invited to extant Regulation 15 of Foreign Exchange Management (Export of Goods & Services) Regulations, 2015 notified vide FEMA 23(R)/2015-RB dated January 12, 2016 and various directions issued to AD banks from time to time prescribing LIBOR linked interest payable in respect of export/import transactions.
2. In view of the impending cessation of LIBOR as a benchmark rate, it has been decided to permit AD banks to use any other widely accepted/Alternative reference rate in the currency concerned for such transactions. All other instructions in this regard shall remain unchanged. The necessary enabling amendment to FEMA 23(R)/2015-RB has since been notified vide Notification No. FEMA 23(R)/(5)/2021-RB dated September 08, 2021 (copy enclosed).
3. AD banks may bring the contents of this circular to the notice of their constituents concerned.