Myntra settles FEMA contraventions with RBI for Rs 2.88 lakh; ED investigation terminated

Fashion e-commerce firm Myntra has settled a foreign exchange compliance case with the RBI, bringing an Enforcement Directorate (ED) investigation into the matter to a close.

The RBI issued a compounding order on 20 April 2026 under Section 15 of the Foreign Exchange Management Act, 1999, after the ED gave its no-objection to the settlement.

The order relates to alleged contraventions by Myntra Designs Private Limited involving delayed filings and overseas investment-related commitments. The matter was settled through a one-time payment of Rs 2.88 lakh.

According to the ED, its investigation was launched after it received “credible information” about alleged FEMA contraventions by the company.

The agency said the case involved a delay in submitting Annual Performance Reports under Regulation 15(iii) of the Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations, 2004. The delayed filings covered Rs 42.85 crore.

It also involved financial commitments made through Overseas Direct Investment while APR submissions were pending, under Regulation 6(2)(iv) of FEMA 120/RB-2004. These commitments covered Rs 3.03 crore.

While the matter was under investigation, Myntra applied to the RBI for compounding of the alleged contraventions. Compounding allows certain FEMA violations to be settled through payment of a prescribed amount.

The ED said the RBI referred the matter to it, after which the agency issued its no-objection “in line with the true spirit of the Act”.

Following the ED’s no-objection, the RBI compounded the alleged contraventions through its order dated 20 April 2026. The ED investigation into these specific alleged FEMA contraventions has now been terminated.

The development appears to be separate from another FEMA-related matter involving Myntra reported in July 2025.

Media reports citing the ED said that in July 2025 the agency had filed a complaint against Myntra, its related entities and directors over alleged violations of India’s foreign direct investment policy amounting to about Rs 1,654.35 crore.

According to those reports, the ED alleged that Myntra carried out multi-brand retail trading under the guise of a wholesale cash-and-carry business model, which permits 100% FDI under the automatic route.

The agency alleged that Myntra received foreign investment and sold most of its goods to related entity Vector E-Commerce, which then sold them to consumers, the reports said.

The ED also alleged that Vector was used to divide transactions into business-to-business and business-to-consumer flows, allowing retail operations to be presented as wholesale trade.

It further alleged that Myntra breached FDI rules by exceeding the permitted 25% sales limit to group companies.

Myntra, responding to those allegations at the time, said it remained committed to complying with all applicable laws and would cooperate with the authorities. The company also said it had not received a copy of the complaint or supporting documents from the ED.