The Central Board of Indirect Taxes and Customs (CBIC) issued the measures to facilitate MSME for AEO T1 & T2 accreditation.
The Board in line with the Prime Minister’s Atma Nirbhar Bharat Abhiyaan to support MSMEs against the challenges of the COVID-19 pandemic, has examined the difficulties faced by MSMEs while applying for AEO accreditation .
The CBIC 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 arc facilitated through rationalized compliance requirements and minimum but effective security requirements.
The Board has decided to facilitate MSMEs by further relaxing the current accreditation process and reducing the compliance burden for their AEO accreditation.
The Board has prescribed the procedure in respect of the modifications/relaxations for AEO accreditation of MSMEs.
Firstly, 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.
Secondly, 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.
Thirdly, the qualifying period for legal and financial compliance has been reduced from ‘the last three financial years’ to ‘the last two financial years’.
The time limit for processing of MSME AEO T1 & 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.
The benefit of relaxation in 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 T1 and MSME AEO T2 entities respectively.
“The AEO accreditation for MSMEs now requires submission of only two annexures for AEO TI and three annexures for AEO T2 applicants respectively. The two common annexures for AEO T1 and AEO T2 are: MSME Annexure 1 (General Compliance), MSME Annexure 2 (Legal, Managing Commercial Records, and Financial Solvency Compliance). Further, the third annexure for AEO T2 is MSME Annexure 3 (Safety and Security Requirements). These annexures have been designed to fulfil the aspirations of simpler application procedure with reduced documentation requirement for AEO accreditation of MSMEs,” the CBIC in the circular said.
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