Mandatory Foreign Liabilities and Assets (FLA) Filing by July 15, 2024 - Compliance Required

As per FEMA Act, 1999 read with RBI Regulations (including any statutory modification(s) or re-enactment(s) thereof, for the time being in force) and Master Directions on Reporting under Foreign Exchange Management Act, 1999, all Indian companies or Limited Liability Partnership (“LLP”) that have received Foreign Direct Investment (“FDI”) by way of capital contribution and/or made FDI abroad (i.e. overseas investment) in the previous year(s) including the current year (April 2023 – March 2024) are required to file the annual return on Foreign Liabilities and Assets (FLA) on or before July 15, 2024, based on audited/ unaudited accounts of the entity. The FLA return will be filed through a web-based interface of RBI.  

It is mandatory to fill the FLA return within the due date. In case the entities do not have their audited balance sheet ready, they may fill the return with the provisional/unaudited numbers. Thereafter, once the audited numbers are ready, request for revision of the previously filed return to RBI needs to be raised. Once approved by RBI, the previously filed return can be revised with audited numbers and re-submit to the same to RBI.

FLA reports typically comprise details of foreign liabilities and assets, including direct investment abroad, and financial details such as trade credits, loans, and other liabilities. Any significant events or changes in foreign liabilities or assets during the reporting period are also disclosed. 

Failure to file the return on or before the due date (July 15, 2024) will be treated as a violation of FEMA, and a penalty may be invoked for such violation. Therefore, companies or LLPs falling under the above-mentioned requirements shall ensure the timely completion of the FLA reporting.