Special measures to facilitate MSME for AEO Accreditation

 1. Please refer to the CBEC Circular No. 33/2016 dated 22.07.2016 as amended, hereinafter referred to as the "Master Circular" regarding the Authorised Economic Operator (AEO) programme. Para 3.1.9 of the Master Circular states that "In particular, the AEO Programme Manager shall take into account the possible difficulties for MSMEs in meeting with these eligibilities conditions and criteria under paras 3.3 and 3.5 to make the above AEO certificates more available to MSMEs."

 

2. In line with the Prime Minister's Aatma Nirbhar Bharat Abhiyaan to support MSMEs against the challenges of the COVID-19 pandemic, CBIC has examined the difficulties faced by MSMEs while applying for AEO accreditation. Accordingly, the Board has decided to relax the entire gamut of compliance and security requirements for MSMEs. The relaxation has been carried out to ensure that the MSMEs are facilitated through rationalized compliance requirements (MSME Annexure 1 & 2) and minimum but effective security requirements (MSME Annexure 3).

 

3. Accordingly, the Board has decided to facilitate MSMEs by further relaxing the current accreditation process and reducing the compliance burden for their AEO accreditation. The procedural modifications/relaxations for AEO accreditation of MSMEs are as under:

 

i.   The eligibility requirement of handling a minimum of 25 documents during the last financial year has been relaxed to 10 documents, subject to handling at least 5 documents in each half-year period of the preceding financial year (Ref.: Para 3.1.7 of the Master Circular).

 

ii. The requirement for the applicant to have "business activities for at least three financial years preceding the date of application" has been relaxed to two financial years. (Ref.: Para 3.1.6 of the Master Circular).

 

iii. The qualifying period for legal and financial compliance has been reduced from 'the last three financial years' to 'the last two financial years'. (Ref.: Paras 3.2 & 3.4 of the Master Circular).

 

iv. For AEO Tl and T2 accreditation, the present annexures i.e., Annexure A, B, C, D, E.I-E.4 have been supplanted with two annexures viz. MSME Annexure I and 2. Similar rationalized annexures 1 and 2 are presently being utilized for AEO Tl accreditation only in accordance with the CB1C Circular No. 26/2018-Customs dated 10.08.2018.

 

v. For AEO T2 certification, the present annexures i.e., Annexure E.5.1-E.5.7 for physical verification have been rationalized to a single annexure viz. MSME Annexure 3. The rationalization has been carried out to ensure that the security requirements for an MSME are objective and cover the minimum verifiable security criteria. (Ref.: Para 3.5 of the Master Circular).

 

vi. The time limit for processing of MSME AEO Tl & AEO T2 application has been reduced to fifteen working days (presently one month) and three months (presently six months) respectively after the submission of complete documents for priority processing by customs zones.

 

vii. The benefit of relaxation in the furnishing of Bank Guarantee for AEOs has been further relaxed to 25% from 50% and 10% from 25% of that required to be furnished by an importer/exporter who is not an AEO certificate holder, for MSME AEO Tl and MSME AEO T2 entities respectively (Ref.: Para 3.5 of the Master Circular).

 

4. The aforestated relaxations shall apply only to an applicant who has a valid MSME certificate from the line-Ministry. Further, the approved MSME must ensure their continuous MSME status during the validity of its AEO certification, if granted.

 Source: Cir. 54/2020-Cus Dt: 15.12.2020