The Director General of Foreign Trade (DGFT) has issued a useful clarification (Policy Circular No. 80/2008, dated April 30, 2009). It follows the amendment in Para 4.22 of the Handbook of Procedures, Vol. 1 (through Public Notice No. 151/2008 dated February 26, 2009), extending the export obligation period of advance authorisations from 24 months to 36 months.
It was not clear from the amendment in the Handbook as to whether the extended export obligation period of 36 months will be available only for authorisations issued from February 26, 2009, onwards or whether the facility would be available for authorisations issued prior to that date also. The DGFT has now clarified that the facility shall be available to all advance authorisations which are within 36 months from the date of issuance of the authorisations, as on February 26, 2009, or thereafter.
For getting the facility of extended export obligation period of 36 months in all such cases, the applicants will be required to file their requests on plain paper only, without the need for any application in any specified format, or any composition fee, to the regional authority concerned. For authorisation issued from February 26 onwards, 36-month original export obligation period endorsement on the Advance Authorisation shall be automatic.
The decision to give more time to exporters to fulfil export obligation has been taken keeping in view the global economic slowdown and consequent difficulties of the exporters to find buyers for the products. The DGFT Policy Circular says that in cases wherein composition fee has already been deposited to Regional Authorities prior to February 26, 2009, for extension in the period of export obligation in terms of earlier provisions, no refund of the composition fee so deposited shall be allowed.
The DGFT has also clarified that the export obligation period for a unit which converts from the Export Oriented Unit (EOU) scheme or the Special Economic Zone (SEZ) scheme to the Export Promotion Capital Goods (EPCG) scheme would be the same as is available to a direct EPCG authorisation-holder i.e. 8/12 years from issue date of EPCG authorisation and that the unit upon conversion from EOU shall be required to maintain the annual average export obligation in terms of Para 5.4(i) of Foreign Trade Policy.
To ensure that counterfeit drugs do not get exported out of the country, procedures/guidelines have been issued to strengthen the enforcement mechanism available under the Drugs and Cosmetics Act, 1940.
DGFT Public Notice No. 173/2008 dated April 13, 2009, says that every exporter of drugs and pharmaceuticals at the time of shipment shall submit, along with other required documents, a copy of the analysis certificate of the product issued by the manufacturer or by a laboratory approved in the importing country or by the Drug Control Administration in India. Besides, wherever required, the officials of the Drug Control Department posted at the port offices shall retain a sample of the subject consignment for the purpose of reference and tracking of the manufacturer/exporter of the subject product.
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