Until May 2000, all foreign exchange operations in India were governed by the provisions of FERA 1973. However in the year 2000, Parliament passed a new legislation, known as Foreign Exchange Management Act 1999 to govern the operations relating to foreign exchange transactions.
As the new Act had been passed, the previous FERA 1973 was repealed. The new Act, FEMA 1999 came into being from June 1, 2000. Thus all foreign exchange operations including maintaining of non-resident accounts by banks are governed by the provisions of the new Act.
Reserve Bank of India (RBI) is mainly empowered with authority under the Act (Central Govt, has also powers under the Act) to regulate foreign exchange operations. As such rules and regulations relating to nonresident accounts are issued by RBI.