DGFT Notifies Online procedure for transfer of Advance/EPCG Authorisation in case of amalgamation/de-merger/acquisition etc.

As per the Public Notice No.34/2015-2020 (Dated the 24th December 2020), DGFT has inserted the following Para of provisions for modifying PAN-based IEC in the handbook of procedures under chapter 2.

• In case of change in the constitution of a Pan-based IEC (Import-Export Code) by way of merger, acquisition, liquidation, inheritance, etc. The PAN of the new company formed is different from the earlier one, an IEC can be availed against the new Pan if not existing already.
• Previous IECs can also be operationally linked to the PAN/IEC of the new entity.
• An Application for linking the Obligations of the old IEC can be submitted online to the new entity’s jurisdictional RA and supporting documents.
• Concerned RA may approve the linkage after due scrutiny of the evidence given by the applicant with affidavits etc.
• After RAs approval old IEC is treated is surrendered IEC.

In continuation with the above matter, the DGFT has introduced an Online Procedure for transfer of Advance License under Advance Authorisation Scheme/EPCG Authorisation under EPCG Scheme in case of amalgamation/demerger/acquisition, etc as per the Trade Notice 14/2021-22 (Dated 04 August 2021).

As per the trade notice, the export obligations/contingent liability is required to be transferred from the old entity to the new entity, as per the new entity as required under the related laws and rules on the amalgamation/de-merger/acquisition/insolvency process.

The details for the online procedures to transfer the Advance/EPCG Authorization from the earlier entity to the new entity are given below-

1) Application for Amalgamation/de-merger/ acquisition of IEC – The applicant can fill the online application on the DGFT portal for amalgamation/de-merger/ acquisition of IEC:

• Visit DGFT Website – https://www.dgft.gov.in/CP/
• From the Services menu, click on IEC Profile Management
• Request for Merger/Demerger

2) Post approval of the given IEC request, the company may apply for the amendment of each of their AA/EPCG authorizations separately, and request for the can be submitted online on DGFT portal –

• Visit DGFT Website –  https://www.dgft.gov.in/CP/
• From the Services menu, click on AA or EPCG
• Select Transfer of Authorization

3) The request for the authorization amendment would be auto-submitted to the concerned jurisdictional RA from which the Authorization was issued.

4) If the request is approved by DGFT, the given authorization would be amended and updated details would be transmitted to customs electronically.

5) Under EPCG Scheme
For the Annual Average Export Obligation (AEO) mentioned on EPCG authorizations,

Where – Company A is EPCG authorization holder, merging into Company B

For the purpose of AEO of company B, the company would be required to submit Chartered Accountant Certificate to the concerned RA as part of the online amendment request.

6) Shipping Bills(S/Bs) & Bill of Entries (B/Es) –

S/Bs and B/Es under the earlier IEC would be available under Bill’s Repository of the new IEC during the authorization closure process.