Notification No. 69/2023 

Date: March 7, 2024

The Ministry of Commerce & Industry, under the Directorate General of Foreign Trade (DGFT) has brought some clarity for importers, particularly for those holding Advance Authorisation and Export Oriented Units (EOUs) through Notification No. 69/2023 dated March 7, 2024.

In the exercise of powers conferred by Section 3 read with Section 5 of the Foreign Trade (Development & Regulation) Act, 1992 (No. 22 of 1992), as amended, read with Para 1.02, 2.01 and 2.03 of the Foreign Trade Policy (FTP), 2023, the Central Government made certain amendments to FTP, 2023. These amendments aim to facilitate smoother import procedures for specified entities.

Key Points to Note

• Amendments to Foreign Trade Policy (FTP), 2023: In the exercise of powers conferred by Section 3 read with Section 5 of the Foreign Trade (Development & Regulation) Act, 1992 (No. 22 of 1992), as amended, read with Para 1.02, 2.01 and 2.03 of the Foreign Trade Policy (FTP), 2023, the Central Government made certain amendments to FTP, 2023. These amendments aim to facilitate smoother import procedures for specified entities.
• Importability of Items under Advance Authorisation: A new para (4.18A) is inserted under FTP 2023, outlining conditions for importing inputs under Advance Authorisation without compliance with mandatory QCOs. Notably, such imports are subject to pre-import conditions and must be utilised in manufacturing export products.
• Exemption Endorsement: Importers must ensure that their Advance Authorisations specifically endorse exemption from mandatory QCOs. Failure to obtain this endorsement will necessitate compliance with QCOs.
• Regularisation of Unutilised Imports: Importers must adhere to procedures for regularising unutilised imports, including destruction in the presence of authorities or re-exportation. Additionally, duties/taxes/cesses exempted on unutilised imports must be paid along with interest and a composition fee.
• Applicability to Physical Exports Only: The exemption from QCOs applies only to physical exports and not to deemed exports for Advance Authorisation Holders.
• Limitations on Clubbing Facility: The facility of clubbing under para 4.36 of the Handbook of Procedures (HBP), 2023, is not available for imports under this exemption.
• EOU Import Exemption: EOUs are also granted exemption from mandatory QCOs on imports required for export production. However, they must submit an undertaking to Customs authorities at the time of importation and provide a copy to the Development Commissioner.
• List of Ministries/Departments: The notification specifies the Ministry of Steel and the Department for Promotion of Industry and Internal Trade (DPIIT) as entities exempted from mandatory QCOs, listed in Appendix 2Y of FTP 2023.

Conclusion

This notification from the DGFT signifies a step towards streamlining import procedures and reducing regulatory burdens for eligible entities. By exempting certain imports from mandatory QCOs, the government aims to facilitate smoother trade operations, encourage exports, and enhance the ease of doing business. 

Importers, particularly holders of Advance Authorisation and EOUs, should familiarise themselves with the provisions outlined in this notification to leverage its benefits effectively. As trade dynamics continue to evolve, such initiatives play a crucial role in fostering a conducive environment for international trade and commerce.

To view the above explained notification click here.

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