In a welcome move, the Directorate General of Foreign Trade (DGFT) has eased the procedures for clubbing of advance authorisations issued in the 2009-14 and 2015-20 Foreign Trade Policy (FTP) periods. And, given useful one-time dispensations to facilitate closure of authorisations under the Export Promotion Capital Goods (EPCG) scheme and older advance authorisations.
Exporters may now ask for clubbing of advance authorisations issued with pre-import conditions and advance authorisations issued with an export obligation (EO) period of less than 18 months. Even cases rejected by the policy relaxation may be considered. However, only export made within the initial or extended EO period of the first licence would be considered. Clubbing will be permitted only when there is a shortfall in EO fulfilment in the first authorisation and excess export in subsequent ones. This condition will not apply when import made in a subsequent authorisation, within the validity period of the first authorisation, are proportional to, equal to or in excess of export made in the first authorisation, says DGFT. They should further explain this clause with examples.
For authorisations issued with pre-import conditions, an EO period extension will be granted up to half the stipulated EO period. The rate of composition fee will depend on whether half the EO has been fulfilled, within the initial period. For regularisation of cases where authorisations are issued for import of drugs from unregistered sources, with a pre- import condition, a certificate from the jurisdictional tax authorities to certify destruction of the unutilised imported quantity in their presence or proof of its re-export to the same supplier is required. Export made under free shipping bills or under the same authorisation after the EO period expiry will also be accepted but customs duty on this must be paid.
DGFT has granted a one-time relaxation for clubbing and for extension of the EO period of advance authorisations issued during FTP 2002-07 and 2004-09, and before June 5, 2012. Applications for such relaxation or extension must come by March 31, 2018. Only shipping bills which bear the file number or advance authorisation number in question will be taken into account. No free shipping bills will be allowed.
On EPCG authorisations, the Regional Authorities (RAs) of DGFT may now consider requests for block-wise EO period extension for requests already submitted. For those submitted beyond the time, on payment of an additional composition fee of Rs 5,000, in addition to payment of regular composition fee, as applicable. They may also consider requests for obtaining a final EO period extension where requests are received in line with the prescribed procedure but haven’t been considered due to non-submission within the prescribed period, on payment of additional composition fee of •5,000 per authorisation. The RA concerned may accept an installation certificate submitted beyond the time limit on payment of a penalty of •5,000 per authorisation. The condition if that the capital goods were installed within 18 months from the date of import but the installation certificate came to the RA beyond this period and the authorisation holder gives bona fide reasons for the delay. These dispensations will help avoid a need to approach the Policy Relaxation Committee or the EPCG Committee for relaxations.