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EconomyThe Hindu5 June 2026
RBI issues compounding order for FEMA violations in Myntra Designs case
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📌 Summary:
- The Reserve Bank of India (RBI) issued a compounding order under the Foreign Exchange Management Act (FEMA) in the Myntra Designs Private Limited case, involving a one-time payment of ₹2.88 lakh
- The order followed a "no objection" from the Enforcement Directorate (ED), which had investigated suspected FEMA contraventions based on inputs
🎯 UPSC Relevance: GS3 economy — FDI regulation in retail/e-commerce, FEMA enforcement and the compounding mechanism for foreign-exchange contraventions.
📝 Prelims Facts:
- Compounding under FEMA = voluntarily settling a contravention by paying a specified sum, avoiding prosecution
- RBI administers FEMA; the ED investigates FEMA violations
- One-time compounding amount in this case: ₹2.88 lakh
🔑 Key Term: Compounding of contravention — voluntary admission and monetary settlement of a regulatory breach to avoid litigation.
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