The International Financial Services Centres Authority (IFSCA) on July 07, 2023, issued the International Financial Services Centres Authority (Banking) (Amendment) Regulations, 2023 to further amend the International Financial Services Centres Authority (Banking) Regulations, 2020.
The following amendments have been stated:
• The existing clause (c) under sub-regulation (1) of regulation 2, shall be substituted with the following, namely :
“Banking Unit” or “BU” means a financial institution defined under clause (c) of sub-section (1) of Section 3 of the Act that is licensed or permitted by the Authority to undertake permissible activities under these regulations.”
• After clause (ea) of sub-regulation (1) of regulation 2, the following clauses shall be inserted, namely:
“(eb) “IFSC Banking Company” or “IBC” means a Banking Unit licensed or permitted by the Authority to operate in an IFSC as a subsidiary company of the Parent Bank.
(ec) “IFSC Banking Unit” or “IBU” means a Banking Unit licensed or permitted by the Authority to operate in an IFSC as a branch of the Parent Bank.”
• Sub-regulation 2 of regulation 12, shall be substituted with the following, namely:
“An account in the specified foreign currencies may be opened, held, and maintained with a Banking Unit in the form of current or savings or term deposit in cases where the account holder is an individual, and in the form of current or term deposit in all other cases, subject to such conditions as may be specified by the Authority.”
• Regulation 14, shall be substituted with the following, namely:
“A Banking Unit shall follow the Anti Money Laundering, Counter-Terrorist Financing and Know Your Customer Guidelines issued by the Authority.”
• Regulation 16 shall be substituted with the following, namely:
“A Banking Unit shall maintain its books of accounts, records, and documents in the specified foreign currencies, as may be declared at the time of making an application under Regulation 3.”
• Regulation 19 shall be substituted with the following, namely:
“A Banking Unit may exchange margins in the specified foreign currencies or permissible listed debt securities and sovereigns with a counterparty Banking Unit or overseas regulated entity for non-centrally cleared over the counter currency, interest rate, credit, and commodity derivative contracts to reflect mark to market exposure under a legally enforceable netting arrangement as may be specified by the Authority.”
They shall come into force on July 07, 2023.
[Notification No. IFSCA/2023-24/GN/REG041]
