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Powers and Functions of Authorised Persons

Description: This quiz tests your knowledge on the Powers and Functions of Authorised Persons under the Foreign Exchange Law.
Number of Questions: 15
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Tags: foreign exchange law authorised persons powers and functions
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Who is an Authorised Person under the Foreign Exchange Law?

  1. A person authorised by the Reserve Bank of India to deal in foreign exchange.

  2. A person authorised by the Government of India to deal in foreign exchange.

  3. A person authorised by the Ministry of Finance to deal in foreign exchange.

  4. A person authorised by the Directorate of Enforcement to deal in foreign exchange.


Correct Option: A
Explanation:

Under the Foreign Exchange Law, an Authorised Person is a person who is authorised by the Reserve Bank of India to deal in foreign exchange.

What are the main functions of an Authorised Person?

  1. To buy and sell foreign exchange.

  2. To lend and borrow foreign exchange.

  3. To invest in foreign exchange.

  4. All of the above.


Correct Option: D
Explanation:

The main functions of an Authorised Person include buying and selling foreign exchange, lending and borrowing foreign exchange, and investing in foreign exchange.

What are the powers of an Authorised Person?

  1. To open and maintain foreign currency accounts.

  2. To issue foreign currency loans.

  3. To invest in foreign securities.

  4. All of the above.


Correct Option: D
Explanation:

The powers of an Authorised Person include opening and maintaining foreign currency accounts, issuing foreign currency loans, and investing in foreign securities.

Who is responsible for regulating Authorised Persons?

  1. The Reserve Bank of India.

  2. The Government of India.

  3. The Ministry of Finance.

  4. The Directorate of Enforcement.


Correct Option: A
Explanation:

The Reserve Bank of India is responsible for regulating Authorised Persons.

What are the consequences of violating the Foreign Exchange Law?

  1. Fines.

  2. Imprisonment.

  3. Both fines and imprisonment.

  4. None of the above.


Correct Option: C
Explanation:

Violating the Foreign Exchange Law can result in both fines and imprisonment.

What is the maximum penalty for violating the Foreign Exchange Law?

  1. A fine of ₹10 lakh.

  2. Imprisonment for 7 years.

  3. Both a fine of ₹10 lakh and imprisonment for 7 years.

  4. None of the above.


Correct Option: C
Explanation:

The maximum penalty for violating the Foreign Exchange Law is both a fine of ₹10 lakh and imprisonment for 7 years.

What is the role of the Authorised Person in the Foreign Exchange Market?

  1. To facilitate the smooth functioning of the market.

  2. To ensure that the market is fair and orderly.

  3. To protect the interests of investors.

  4. All of the above.


Correct Option: D
Explanation:

The role of the Authorised Person in the Foreign Exchange Market is to facilitate the smooth functioning of the market, ensure that the market is fair and orderly, and protect the interests of investors.

What are the different types of Authorised Persons?

  1. Banks.

  2. Non-banking financial companies.

  3. Primary dealers.

  4. All of the above.


Correct Option: D
Explanation:

The different types of Authorised Persons include banks, non-banking financial companies, and primary dealers.

What are the eligibility criteria for becoming an Authorised Person?

  1. To be a company registered under the Companies Act.

  2. To have a net worth of at least ₹10 crore.

  3. To have a sound financial track record.

  4. All of the above.


Correct Option: D
Explanation:

The eligibility criteria for becoming an Authorised Person include being a company registered under the Companies Act, having a net worth of at least ₹10 crore, and having a sound financial track record.

What is the procedure for becoming an Authorised Person?

  1. To apply to the Reserve Bank of India.

  2. To submit a detailed business plan.

  3. To pay a registration fee.

  4. All of the above.


Correct Option: D
Explanation:

The procedure for becoming an Authorised Person includes applying to the Reserve Bank of India, submitting a detailed business plan, and paying a registration fee.

What are the ongoing obligations of an Authorised Person?

  1. To maintain a minimum net worth.

  2. To submit periodic reports to the Reserve Bank of India.

  3. To comply with the Foreign Exchange Law and regulations.

  4. All of the above.


Correct Option: D
Explanation:

The ongoing obligations of an Authorised Person include maintaining a minimum net worth, submitting periodic reports to the Reserve Bank of India, and complying with the Foreign Exchange Law and regulations.

What are the consequences of failing to comply with the ongoing obligations?

  1. Cancellation of Authorisation.

  2. Fines.

  3. Imprisonment.

  4. All of the above.


Correct Option: D
Explanation:

Failing to comply with the ongoing obligations can result in cancellation of Authorisation, fines, imprisonment, or all of the above.

What is the role of the Reserve Bank of India in regulating Authorised Persons?

  1. To issue Authorisations.

  2. To supervise Authorised Persons.

  3. To enforce the Foreign Exchange Law and regulations.

  4. All of the above.


Correct Option: D
Explanation:

The role of the Reserve Bank of India in regulating Authorised Persons includes issuing Authorisations, supervising Authorised Persons, and enforcing the Foreign Exchange Law and regulations.

What are the recent developments in the regulation of Authorised Persons?

  1. The Reserve Bank of India has issued new guidelines for Authorised Persons.

  2. The Government of India has amended the Foreign Exchange Law.

  3. The Ministry of Finance has issued new regulations for Authorised Persons.

  4. All of the above.


Correct Option: D
Explanation:

The recent developments in the regulation of Authorised Persons include the Reserve Bank of India issuing new guidelines for Authorised Persons, the Government of India amending the Foreign Exchange Law, and the Ministry of Finance issuing new regulations for Authorised Persons.

What is the future of the regulation of Authorised Persons?

  1. The Reserve Bank of India is planning to further tighten the regulation of Authorised Persons.

  2. The Government of India is planning to introduce new laws to regulate Authorised Persons.

  3. The Ministry of Finance is planning to issue new regulations to regulate Authorised Persons.

  4. All of the above.


Correct Option: D
Explanation:

The future of the regulation of Authorised Persons includes the Reserve Bank of India planning to further tighten the regulation of Authorised Persons, the Government of India planning to introduce new laws to regulate Authorised Persons, and the Ministry of Finance planning to issue new regulations to regulate Authorised Persons.

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