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Date: 23-Sep-2024 Category: Extra Ordinary State: Union Government Country: India

Amendment in Chapter 5 of the Handbook of Procedures HBP 2023 related to EPCG Scheme to reduce Compliance Burden and enhance Ease of doing Business

Issued by Ministry of Commerce and Industry · Directorate General of Foreign Trade

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Executive Summary & Key Takeaways

Gazette Notification Description

  • This public notice, issued by the Directorate General of Foreign Trade (DGFT), Ministry of Commerce and Industry, Government of India, amends Chapter 5 of the Handbook of Procedures (HBP) 2023. The amendment specifically targets the Export Promotion Capital Goods (EPCG) Scheme to reduce compliance burden and improve ease of doing business.

Key Changes

  • The amendment simplifies the annual reporting requirement for EPCG authorization holders regarding Export Obligation (EO) fulfillment.
  • Previously, authorization holders had to submit an annual report by June 30th each year, detailing EO fulfillment through online submission. Any delay incurred a late fee of Rs. 5000/- per year.
  • The revised provision requires submission of an EO fulfillment report through online mode only after the expiry of the first four-year block period and continuously until the EO period expires.
  • The revised report must include details such as Shipping bill/Invoice number/Bill of Export/FIRC number with date and number, duly certified by a Chartered Accountant/Cost Accountant/Company Secretary.

Impact Analysis

Impact on EPCG Authorization Holders

  • Increased transparency and accountability: Certification by a professional ensures the accuracy and reliability of the reported data.

Impact on DGFT

  • Enhanced efficiency: Streamlined processes lead to improved efficiency in monitoring EO fulfillment.

Impact on Chartered Accountants/Cost Accountants/Company Secretaries

  • Increased demand for certification services: More EPCG authorization holders will require their services for report certification.

Suggested Action Items

  • DGFT should provide clear guidelines and support to authorization holders regarding the online reporting process and required certifications.

Key Entities Referenced

Directorate General of Foreign Trade (DGFT): The issuing authority of the public notice; responsible for regulating foreign trade in India. Ministry of Commerce and Industry: The parent ministry under which DGFT operates. Handbook of Procedures (HBP) 2023: The document containing the rules and regulations governing foreign trade in India; Chapter 5 deals with the EPCG scheme. Export Promotion Capital Goods (EPCG) Scheme: A scheme that allows import of capital goods at concessional duty rates, subject to export obligations. Foreign Trade Policy, 2023: The overarching policy document governing foreign trade in India, under which the DGFT operates and the HBP is issued.
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