Forward Booking Freedom

formalities to be completed by a corporate before booking a forward cover with an authorised dealer. They had to prove that an exposure already existed and hence could not hedgetheir future exports and imports as documentary proofwas not available. But the RBI has now permitted the booking of forward contracts merely on the basis of a declaration by a company of its exposure. This is subject to

the following conditions:the amount of forward contract booked should in aggregate not exceed the average of the actual export / import figures of the applicant for the preceding 2 years; the corporate should furnish a certificate to the effect that the exposures covered by the contract have not been covered by any other authorised dealer; the Board of Directors of a company should fix the limits for the authorised officer to book / cancel / rebook contracts (where applicable) to manage exchange risk and a copy of the boards policy should be submitted to the authorised dealer.