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RBI asks banks to draw up policy for property deals abroad

Says banks should comply with the Foreign Exchange Management Act, Banking Regulation and other relevant Indian laws

Press Trust of India  |  Mumbai 

The Reserve Bank of India has asked with offices abroad to formulate a policy for overseas real-estate transactions.

The said it has come to its notice that some Indian have committed certain lapses while buying or selling and taking or letting out property on lease or rentals in some places in foreign countries, it said in a notification today.


"To avoid such lapses in future, it is advised that boards of directors of should lay down policies and formulate detailed operational guidelines to protect the interests of their respective banks," the said.

It asked to ensure that all real-estate and property transactions at overseas centres are undertaken as per the board-approved policy.

The should comply with the Foreign Exchange Management Act, Banking Regulation and other relevant Indian laws.

"The policy should, inter alia, require the agreements for acquiring or letting out premises on rental/lease basis to incorporate a suitable exit clause," it said.

The also said should comply with all applicable laws of the host country, city or locality while making such deals.

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