CBIC has issued clarification regarding the implementation of origin procedures under India – Australia ETCA

The Central Board of Indirect Taxes and Customs (CBIC) has issued clarification regarding the implementation of origin procedures under India – Australia ETCA by issuing instructions.

Attention is drawn to the Instruction No. 19/2022-Customs of August 17, 2022, which had made the field offices aware of the application of the Customs Rules (Administration of Rules of Origin under Trade Agreements), 2020 (CAROTAR) in order to ensure compliance with the to uphold Rules of Origin (ROO). and operational certification procedures (OCP) of the respective free trade agreement (FTA) for the purpose of implementation; and that in the event of a conflict between a provision of CAROTAR and a provision of the ROO/OCP under the FTA, the latter shall prevail to the extent of the conflict, as provided for in Rule 8(3) of CAROTAR.

This prudent manner of implementation, communicated separately for each FTA, and avoiding redundant references to COO verification by field offices to the FTA cell are both important to maintaining convenience of doing business. Consequently, inspectors must ensure these aspects.

The Board was also regularly reminded of some issues affecting the implementation of ROO and OCP under the India-Australia ECTA. These are clarified as follows:-

i) The India-Australia ECTA recognizes electronic certificates of origin. Therefore, an e-COO issued electronically by the issuing bodies of Australia is a valid document for the purposes of claiming preferential benefits under the ECTA India-Australia, provided that the e-COO is issued in the prescribed format, bears a seal and signatures of the authorized issuing body or agency and meets all other requirements set forth in Notice No. 112/2022-Customs (NT) dated December 22, 2022.

a) The pre-circulated seal and signature samples will continue to be used to verify the genuineness/authenticity of e-COO. If in doubt a verification needs to be initiated with the issuing authority of the exporting country, the matter will be referred to the FTA cell (in the Directorate of International Customs) to initiate the verification process only through agreed communication channels.

b) The e-COO is mandatory to be uploaded to e-Sanchit by the importer/customs broker in order to benefit from the preferential benefit and the e-COO details such as unique reference number and date, origin criteria etc. must be carefully entered when submitting the incoming invoice .

c) For purposes of redacting, a hard copy of e-COO must be presented to the customs officer who will cross-check the unique reference number and other details entered in the receipt against the hard copy of e-COO. This will be in lieu of redacting the original paper copy of a certificate of origin. In this context, it is recalled that a check has already been introduced into the system to prohibit the use of the same COO reference number in more than one entry ticket.

ii) Notification No. 112/2022-Customs (NT) dated December 22, 2022 lists the requirements for a valid COO/e-COO under ECTA India-Australia, and the affixing of a QR code on the COO/e-COO is no requirement according to the same.

iii) There are no overleaf notes on the COO format in the India-Australia ECTA. However, when notifying the Rules of Origin, after due consultation with the Australian side of Notification No. 112/2022-Customs (NT) dated December 22, 2022, these were added by the Indian side as guidance for the respective issuing authorities/bodies as well as traders. The purpose of the Overleaf Notes is to provide guidance on how to complete certain entries in the COO format, and the Overleaf Notes per se are not part of the COO format. Therefore, the absence of the overleaf comments on the COOs received from Australia may not be grounds for initiating a review or denying the preferential benefit.

iv) Given the geographical distance between India and Australia, weather disturbances, logistic convenience, etc., the exporters may not always know the port of destination. In order to avoid reissuing the COO, Australian exhibitors will fill in the ‘Port of Destination’ field with ‘all ports in India’. A similar practice is also followed by the issuing authorities of India when necessary. Therefore, as long as the details on the COO and the transport documents match, the listing of “any ports in India” in the COO’s Port of Destination field by the issuing authorities of Australia may not be grounds for initiating an inspection or denying the preferential benefit.

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CBIC has issued clarification regarding the implementation of origin procedures under India – Australia ETCA

The Central Board of Indirect Taxes and Customs (CBIC) has issued clarification regarding the implementation of origin procedures under India – Australia ETCA by issuing instructions.

Attention is drawn to the Instruction No. 19/2022-Customs of August 17, 2022, which had made the field offices aware of the application of the Customs Rules (Administration of Rules of Origin under Trade Agreements), 2020 (CAROTAR) in order to ensure compliance with the to uphold Rules of Origin (ROO). and operational certification procedures (OCP) of the respective free trade agreement (FTA) for the purpose of implementation; and that in the event of a conflict between a provision of CAROTAR and a provision of the ROO/OCP under the FTA, the latter shall prevail to the extent of the conflict, as provided for in Rule 8(3) of CAROTAR.

This prudent manner of implementation, communicated separately for each FTA, and avoiding redundant references to COO verification by field offices to the FTA cell are both important to maintaining convenience of doing business. Consequently, inspectors must ensure these aspects.

The Board was also regularly reminded of some issues affecting the implementation of ROO and OCP under the India-Australia ECTA. These are clarified as follows:

i) The India-Australia ECTA recognizes electronic certificates of origin. Therefore, an e-COO issued electronically by the issuing bodies of Australia is a valid document for the purposes of claiming preferential benefits under the ECTA India-Australia, provided that the e-COO is issued in the prescribed format, bears a seal and signatures of the authorized issuing body or agency and meets all other requirements set forth in Notice No. 112/2022-Customs (NT) dated December 22, 2022.

a) The pre-circulated seal and signature samples will continue to be used to verify the genuineness/authenticity of e-COO. If in doubt a verification needs to be initiated with the issuing authority of the exporting country, the matter will be referred to the FTA cell (in the Directorate of International Customs) to initiate the verification process only through agreed communication channels.

b) The e-COO is mandatory to be uploaded to e-Sanchit by the importer/customs broker in order to benefit from the preferential benefit and the e-COO details such as unique reference number and date, origin criteria etc. must be carefully entered when submitting the incoming invoice .

c) For purposes of redacting, a hard copy of e-COO must be presented to the customs officer who will cross-check the unique reference number and other details entered in the receipt against the hard copy of e-COO. This will be in lieu of redacting the original paper copy of a certificate of origin. In this context, it is recalled that a check has already been introduced into the system to prohibit the use of the same COO reference number in more than one entry ticket.

ii) Notification No. 112/2022-Customs (NT) dated December 22, 2022 lists the requirements for a valid COO/e-COO under ECTA India-Australia, and the affixing of a QR code on the COO/e-COO is no requirement according to the same.

iii) There are no overleaf notes on the COO format in the India-Australia ECTA. However, when notifying the Rules of Origin, after due consultation with the Australian side of Notification No. 112/2022-Customs (NT) dated December 22, 2022, these were added by the Indian side as guidance for the respective issuing authorities/bodies as well as traders. The purpose of the Overleaf Notes is to provide guidance on how to complete certain entries in the COO format, and the Overleaf Notes per se are not part of the COO format. Therefore, the absence of the overleaf comments on the COOs received from Australia may not be grounds for initiating a review or denying the preferential benefit.

iv) Given the geographical distance between India and Australia, weather disturbances, logistic convenience, etc., the exporters may not always know the port of destination. In order to avoid reissuing the COO, Australian exhibitors will fill in the ‘Port of Destination’ field with ‘all ports in India’. A similar practice is also followed by the issuing authorities of India when necessary. Therefore, as long as the details on the COO and the transport documents match, the listing of “any ports in India” in the COO’s Port of Destination field by the issuing authorities of Australia may not be grounds for initiating an inspection or denying the preferential benefit.

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