Applicable Act / Rule: Foreign Exchange Management Act, 1999
The Reserve Bank of India has mandated reporting of Foreign Liabilities and Assets (FLA) for entities having foreign investments or overseas investments. This requirement applies to companies, LLPs and other entities holding outstanding foreign assets or liabilities on their balance sheet. The reporting mechanism was shifted from email-based submission to an online system through the FLAIR portal from June 2019.
Entities which have received Foreign Direct Investment (FDI) and/or made overseas investment are required to submit annual FLA Return.
The return is required to be filed through the web-based FLAIR portal by completing registration, uploading verification and authority letters, and submitting data online.
Entities must ensure accurate reporting of foreign liabilities and assets, including equity participation, debt instruments, and other financial claims or obligations with non-residents.
The FAQs provide detailed procedural guidance on registration, filing process, data reporting requirements, validation checks, and handling of errors or modifications in submitted returns.
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