Regulation 4 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Regulation 4 also sets one yearly return and four event-based ones. The yearly return is the Annual Return on Foreign Liabilities and Assets (FLA). The others are the LEC forms filed by banks and investee companies for portfolio and individual foreign investors, Form InVI for investment vehicles, and Form CN for convertible notes issued by start-ups.
These are the Foreign Exchange Management (Mode of Payment and Reporting of Non-Debt Instruments) Regulations, 2019 (Notification No. FEMA. 395/2019-RB, October 17, 2019), as per the text on the Reserve Bank's site, amended up to June 13, 2026. An Indian company that has received FDI, or an LLP that has received capital contribution, submits Form FLA on or before the 15th day of July of each year, with the year reckoned April to March. Form InVI and Form CN are due within 30 days. The Authorised Dealer Category I banks file Forms LEC (FII) and LEC (IFI).
Authority and limits of the sources
The Regulations are made under "section 47 of the Foreign Exchange Management Act, 1999 ... and consequent to the Foreign Exchange Management (Non-Debt Instrument) Rules, 2019". See the Act articles on sections 47 and 48 and section 6. The Rules are not in the sources consulted, so terms that depend on them (for example "foreign portfolio investment" or "start-up company") are not explained, and the Master Direction on Reporting, where the forms are set out, is not in the sources either. Forms are named as the Regulations name them and no fields are described. For the annual return, see our FLA return service.
The reports in this article
| Sub-regulation | Form | Who files | Time limit as printed |
|---|---|---|---|
| 4(2) | Annual Return on Foreign Liabilities and Assets (FLA) | An Indian company which has received FDI, or an LLP which has received investment by way of capital contribution, in the previous year including the current year | On or before the 15th day of July of each year; "year" means April to March |
| 4(8)(i) | Form LEC (FII) | Authorised Dealer Category I banks, for purchase or transfer of equity instruments by FPIs on stock exchanges in India | Not stated in the clause |
| 4(8)(ii) | Form LEC (FII) | The investee Indian company, through an Authorised Dealer Category I bank, for purchase or subscription of equity shares (where classified as Foreign Portfolio Investment under the Rules) by a permissible holder, other than transfers between permissible holders, on an International Exchange | Not stated in the clause |
| 4(9) | Form LEC (Individual Foreign Investor - IFI) | The designated Authorised Dealer Category I banks, for purchase or transfer of equity instruments by an individual person resident outside India, including NRIs and OCIs, on stock exchanges in India | Not stated in the clause |
| 4(10) | Form InVI | An investment vehicle which has issued units to a person resident outside India | Within 30 days from the date of issue of units |
| 4(12) | Form Convertible Notes (CN) | An Indian start-up company issuing convertible notes to a person resident outside India; and a person resident in India who transfers or receives convertible notes to or from a non-resident | Within 30 days of the issue, or within 30 days of the transfer |
Sub-regulation 4(8) was modified by the Amendment Regulations, 2024 (Notification No. FEMA 395(2)/2024-RB dated April 23, 2024), and sub-regulation 4(9) was substituted by the Amendment Regulations, 2026 (Notification No. FEMA 395(4)/2026-RB dated June 13, 2026), as the footnotes on the page record.
The FLA return in detail
Regulation 4(2) reads: "An Indian Company which has received FDI or an LLP which has received investment by way of capital contribution in the previous year including the current year, shall submit form FLA to the Reserve Bank on or before the 15th day of July of each year." The Explanation fixes the year as April to March. Two points follow from the text.
- The trigger is receipt, not holding. The company or LLP files if it has received FDI (or capital contribution) in the previous year "including the current year". The sub-regulation does not mention a size threshold, and none is stated here because none is printed.
- The date is fixed. Unlike the 30-day and 60-day reports, the FLA return has a calendar date. The delay consequence is regulation 5, which makes the person or entity responsible for the filing liable to a late submission fee as the Reserve Bank decides in consultation with the Central Government.
Who files the LEC forms
Forms LEC (FII) and LEC (IFI) are filed by the banks, and in one case by the investee company through a bank. The clause for FPIs, 4(8)(i), puts the duty on the Authorised Dealer Category I banks for stock exchange purchases or transfers in India. Clause 4(8)(ii) adds the investee company, through an Authorised Dealer Category I bank, for shares bought or subscribed on an International Exchange by a "permissible holder". Clause 4(9) puts the duty for individual foreign investors on the designated Authorised Dealer Category I banks. None of the three clauses prints a time limit. They also fall under the proviso to regulation 4 that the format, periodicity and manner of submission are as the Reserve Bank prescribes.
Form InVI and Form CN
An investment vehicle that has issued units to a non-resident files Form InVI within 30 days from the date of issue of the units. Regulation 4(12) covers convertible notes: the Indian start-up company files Form CN within 30 days of the issue, and a person resident in India who is a transferor or transferee of convertible notes reports each transfer to or from a non-resident in Form CN within 30 days of the transfer. The mode of payment for convertible notes is in regulation 3.2, explained in our article on NRI, LLP, FVCI and convertible note payments.
Example
Horizon Gadgets Private Limited, an invented start-up, issued convertible notes to an overseas investor on 5 February. Form CN is due within 30 days of that issue. In its financial year ending 31 March, the company also allotted equity shares to the same investor; because it has received FDI, it submits Form FLA on or before 15 July after the year ends. If the investor later sells the notes to a resident, the resident reports the transfer in Form CN within 30 days. Our guides to the FLA return: purpose, applicability and format and how to file the FLA return give the filing steps.
Later amendments and circulars, and the Reserve Bank's formats, should be checked.
Need help with the FLA return?
The annual return carries a fixed date and draws on the full year's investments and balances. Our FLA return team prepares it from your records before 15 July.
Key takeaways
- Form FLA is due on or before 15 July each year, year reckoned April to March, from a company that received FDI or an LLP that received capital contribution.
- Banks file Forms LEC (FII) and LEC (IFI); the investee company files LEC (FII) through a bank for international exchange purchases.
- Form InVI and Form CN: 30 days.
- A person resident in India who transfers or receives convertible notes to or from a non-resident also reports in Form CN.
- Late reports attract a late submission fee under regulation 5.
Read next
- Form DI and the late submission fee: regulations 4 and 5
- Form FC-TRS for share transfers: regulation 4(3)
- Form FLA return: purpose, applicability and format
- How to file the FLA return with RBI
Disclaimer: Based on the rules, regulations and Reserve Bank Master Directions under the Foreign Exchange Management Act, 1999 that this article names, each in the version and up to the date stated in the article, as consulted on 2 October 2026. Some texts are third-party copies or older prints and are identified as such. Limits, forms and time limits change by amendment and circular; later changes should be checked on the Reserve Bank and Gazette sites. This article is general information, not legal advice; check the official text before acting.