With the objective to enhance the security level in data submission and to further improve the data quality, the Reserve Bank of India (RBI) through its circular dated 28 June 2019 (RBI Circular) has replaced the present email-based reporting system for submission of the Foreign Liabilities and Assets (FLA) return, with a web-based Foreign Liabilities and Assets Information Reporting (FLAIR) system.
FLA return is mandatory under the Foreign Exchange Management Act, 1999 and companies are required to submit the same based on audited/ unaudited account by July 15 every year. It is required to be submitted directly by all Indian companies that have received FDI (foreign direct investment) and/or have made FDI abroad (i.e. overseas investment) in the previous year(s) including the current year i.e. companies that hold foreign assets or liabilities as per their balance sheets (Eligible Companies).
Prior to the aforesaid RBI Circular, Eligible Companies were required to file the FLA in the soft form that could be duly filled-in, validated and sent by e-mail to the RBI. This has now been changed to the web-based reporting system.