Export of Goods
and Services - Facilities to Units in Special Economic Zones (SEZs)
A.P.(DIR Series) (2002-2003) Circular No. 91, dated 1-4-2003
Attention
of authorised dealers is invited to A.P. (DIR Series) Circular No. 28 dated
March 30, 2001 and subsequent circulars issued extending various facilities to
units in Special Economic Zones. It has been decided to extend the following
facilities to the units located in the Special Economic Zones (SEZs) :—
In
terms of para 11(c) of AP (DIR Series) Circular No.28 dated March 30, 2001,
units situated in Special Economic Zones have been permitted to realise and
repatriate to India the full value of goods or software within a period of
twelve months from the date of export. It has now been decided to remove the
stipulation of twelve months or extended period thereof for realisation of
export proceeds. Accordingly, there shall be no prescription of any time limit
for realisation of exports made by units in SEZs. However, the units in SEZs
will continue to follow the GR/PP/SOFTEX export procedure outlined in Part B of
Annexure to A.P. (DIR Series) Circular No.12 dated September 9, 2000 as amended
from time to time.
To
promote international operations, units in SEZs are permitted to undertake
jobwork abroad and export goods from that country itself subject to fulfilment
of the following conditions :
(i) Processing/manufacturing
charges are suitably loaded in the export price and are borne by the ultimate
buyer.
(ii) The
exporter has made satisfactory arrangements for realisation of full export
proceeds subject to the usual GR procedure.
C. Receipts of payment in precious metals for EOUs and units in SEZs
Attention
of authorized dealers is invited to para. A.4 of Annexure to AP (DIR Series)
Circular No.12 dated September 9, 2000 in terms of which the amount
representing the full export value of goods exported shall be received through
an authorized dealer in the manner specified in Notification No. FEMA. 14/2000-RB
dated May 3, 2000 (Manner of Receipt & Payment) Regulations, 2000. It has
been decided that payment of export may also be received by the Gem &
Jewellery units in SEZs and EOUs in form of precious metals i.e.
Gold/Silver/Platinum equivalent to value of jewellery exported on the condition
that the sale contract provides for the same and the approximate value of the
precious metal is indicated in the relevant GR/SDF/PP forms.
It
has been decided that authorised dealers may allow requests received from
exporters for ‘netting off’ of export receivables against import payments for
units located in Special Economic Zones subject to the following :
(i) The
‘netting off’ of export receivables against import payments is in respect of
the same Indian entity and the overseas buyer/supplier (bilateral netting). The
netting may be done as on date of balance sheet of the unit in SEZ.
(ii) The
details of export of goods is documented in GR(O) forms/DTR as the case may be
while details of import of goods/services is recorded through A1/A2 form as the
case may be. The relative GR/SDF forms will be treated as complete by the
designated authorised dealer only after the entire proceeds are
adjusted/received.
(iii) Both
the transactions of sale and purchase in ‘R’ Returns under FET-ERS are reported
separately.
(iv) The
export/import transactions with ACU countries are kept outside the arrangement.
(v) All
the relevant documents are submitted to the concerned authorised dealer who
should comply with all the regulatory requirements relating to the
transactions.
Units
in SEZs are permitted to issue equity shares to non-residents against import of
capital goods subject to the following :—
(a) The
valuation should be verified by a Committee consisting of Development
Commissioner and the appropriate Customs Officials.
(b) The SEZ
units issuing equity in the above manner should report the particulars of the
shares issued in the form ‘FC-GPR’ prescribed under para 9 of Schedule I
[Regulation 5(1)] to Notification No. FEMA.20/2000- RB dated May 3, 2000 to the
concerned Regional Office under whose jurisdiction the SEZ falls, together with
the copy of the valuation certificate. A copy of the report may be forwarded to
Department of Industrial Policy and Promotion (DIPP), Ministry of Commerce and
Industry, Government of India, Udyog Bhavan, New Delhi-110 001.
Necessary amendments to the Foreign
Management Regulations are being notified separately.
These facilities will be available
in respect of the shipments made on or after April 1, 2003.
Authorised
Dealers may bring the contents of the circular to the notice of their
constituents concerned.
The directions contained in this
circular have been issued under section 10(4) and section 11(1) of the Foreign
Exchange Management Act, 1999 (42 of 1999).