(The Gist of PIB) New rule for importers to get FTA concessions
(THE GIST OF PIB) New rule for importers to get FTA concessions
New rule for importers to get FTA concessions
- Customs (Administration of Rules of Origin under Trade Agreements) Rules, 2020 (CAROTAR, 2020) notified by Department of Revenue will come into force from 21st September, 2020.
- CAROTAR, 2020 are aimed at plugging duty evasion through routing exports to India under free trade agreements (FTAs).
- FTAs allow imports of most of the items at nil or concessional basic customs duty rate. Investigation has revealed that the rules of origin (ROO) were not being followed under respective FTAs.
- ROO are the criteria prescribed to determine the national origin of an imported product in a country.
- It is believed that goods originating from China are routed through countries, having FTAs with India, without any substantial value addition.
- Presently, importers need to produce a country of origin certificate, issued by country of export.
- Under new rules, Importers need to furnish proof of 35% value addition in goods from the country of origin to claim duty concession under FTAs.
- A list of minimum information which the importer is required to possess has also been provided in the rules.