Section 13 of IFSCA : Section 13: Powers Of Authority In Relation To Financial Products, Financial Services And Financial Institutions

Explanation using Example

Imagine a scenario where a company, "GlobalFintech Ltd.," is operating in an International Financial Services Centre (IFSC) in India and offers innovative financial products to international clients. The Securities and Exchange Board of India (SEBI) typically regulates such companies, but because GlobalFintech Ltd. is within an IFSC, the International Financial Services Centres Authority (IFSCA) exercises the regulatory powers instead, as per Section 13 of The International Financial Services Centres Authority Act, 2019.

GlobalFintech Ltd. must apply for registration with the IFSCA and comply with the regulations that the IFSCA sets forth, which mirror the powers and regulations of SEBI but are specifically tailored for the unique environment of the IFSC.

If GlobalFintech Ltd. is found to be non-compliant with the IFSCA's regulations, the IFSCA can impose penalties on the company. Any fines levied would be payable in the foreign currency equivalent, based on the exchange rate notified by the Reserve Bank of India on the date of the penalty order.

Ultimately, the fines collected by the IFSCA from GlobalFintech Ltd. would be credited to the Consolidated Fund of India in Indian Rupees, contributing to the nation's financial resources.