Summary: This blog examines the compounding framework under the Compounding Rules and Directions, as amended in April 2025, with a particular focus on non-reporting contraventions under FEMA. It argues that the RBI’s increasingly facilitative approach to compounding has made it the most commercially sensible route for entities seeking to regularise historical non-compliances under FEMA and India’s FDI policy.
Continue Reading Compounding of non-reporting contraventions under FEMA
Summary: The Ministry of Finance published the Draft Insurance Ombudsman (Amendment) Rules, 2025 (“Draft IO Amendment Rules”), for public consultation in November 2025, which continue to remain in draft form. The Draft IO Amendment Rules proposed significant amendments to the current regime, including digitisation measures, enhanced penalties, and establishment of an appellate authority to entertain appeals against awards passed by the Ombudsman. We revisit the basic principles regime, with mediation as its cornerstone, highlight areas of ambiguity, and analyse the direction of Draft IO Amendment Rules are taking.
Continue Reading Insurance Ombudsman and the Case for Consent-Based Mediation
The IRDAI published a circular on Remuneration to Key Management Persons, dated May 25, 2026 (“Circular”). This was soon after a concept paper revisiting the remuneration of Key Managerial Personnel (“KMP”) of Indian insurers was shared among a select group of stakeholders, inviting their comments. The Circular, which is now applicable law, amends the IRDAI Master Circular on Corporate Governance for Insurers, 2024 (“Master Circular”). The Circular has been issued in exercise of powers under Section 34 of the Insurance Act, 1938, Section 14 of the IRDA Act, 1999, and Regulation 12 of the Regulations.
Continue Reading IRDAI sets up performance scorecard for KMPs: A case for indirect enforcement
Summary: As artificial intelligence reshapes the contours of India’s financial landscape, regulated entities find themselves navigating a delicate balance between harnessing transformative innovation and managing its inherent risks spanning algorithmic bias, model opacity, and systemic concentration. The RBI’s establishment of the FREE-AI committee signals a decisive regulatory commitment to responsible AI governance, anchored in principles of accountability, fairness, and explainability. The paper ultimately calls upon regulated entities to embed these imperatives at the very foundation of their AI frameworks, underpinned by robust data governance and a culture of institutional vigilance.
Continue Reading FIG Paper No 59 – AI in Indian Financial Services: Balancing Innovation with Accountability and Regulation
The Foreign Exchange Department, Reserve Bank of India (“RBI”), on May 13, 2026, issued a circular titled ‘Operating framework for facilitating Outward Remittance services by non-bank entities through Authorized Dealer (Category I) Banks (“AD Banks”) in India’ (“Outward Remittance Circular”), which:
Continue Reading FIG Paper No 58: RBI Issues Operating Framework for Facilitating Outward Remittance Services by Non-Bank Entities
Summary: This FIG Paper examines recent global regulatory and market developments in digital assets, including Hong Kong’s first stablecoin licences, countries finalising their digital assets regulatory frameworks, and BIS warnings on stablecoin-driven dollarisation. It then analyses India’s evolving response through the revised FIU-IND registration regime, tightening tax reporting and enforcement trends, and the RBI’s evolving regulatory response to stablecoins.
Continue Reading FIG Paper No. 57 (VDA Series 11) India Digital Assets Round-Up: Recent Regulatory and Market Developments
There are moments in tax litigation when the revenue administration machinery seems to lose sight of first principles. The Bombay High Court judgment in Tata Sons Private Limited v. Union of India & Others, pronounced on April 30, 2026, is one such moment. The Court’s firm, unambiguous rejection of a INR 1,524 crore Goods and Services Tax (“GST“) demand will be cited for years as a corrective to a particular species of over-reach that has afflicted indirect tax administration in India.
Continue Reading Whether payment made pursuant to an Arbitral Award followed by a Court Decree be liable to GST ? Analysis of landmark Bombay High Court Judgment
Summary: India’s push to internationalise UPI promises faster, cheaper, and more seamless cross-border payments, while also exposing deep regulatory and legal issues. This article explains why real-time payment speed is outpacing compliance frameworks across spanning foreign exchange rules, AML/KYC obligations, data localisation, and supervisory oversight and why resolving these tensions is critical for UPI’s global scalability. For regulators and financial institutions, it highlights what must evolve for cross-border digital payments to succeed.
Continue Reading UPI Goes Global: The Regulatory Reckoning Ahead
Summary: The Payments Vision 2028 themed “Shaping India’s Payment Frontier” lays out the strategic direction for payments regulation till December 2028. The regulator’s focus is on strengthening accountability among regulated entities, building customer trust, and enhancing the resilience of payment systems. Key proposals include a cyber risk monitoring regime for non-bank PSOs, a Payments Switching Service enabling customers to redirect payments across bank accounts, and interoperability mandates for card networks and TReDS platforms, amongst others.
Continue Reading FIG Paper No. 56 : Payments Vision 2028: Way Forward
Summary: The Board’s discretion to dispose of unsubscribed portion of rights issue to non-shareholders was made a bit easier by the Companies Act, 2013, by giving more flexibility to the Board as compared to the language used in the 1956 Act. However, whether such disposal is tantamount to a preferential allotment or a public offer (when offered to more than 200 persons) has always been a subject of legal debate. This blog demystifies the legal position and clarifies the applicability of the RBI’s pricing guidelines under FEMA, when such allotment is made to a non-resident investor.
Continue Reading Disposal of Unsubscribed Portion in Rights Issue: Legal Position in India