Revalidation and Extension of Export Obligation Period for Advance Authorisation License

In the world of exports and imports, the Advance Authorisation License plays a crucial role in allowing duty-free imports of raw materials for manufacturing export goods. However, fulfilling the export obligation within the stipulated time can sometimes be challenging. This is where revalidation and the extension of the Export Obligation (EO) period come into play.

In this blog, we will explore the importance of Advance Authorisation License revalidation and EO extension, their procedures, and how they can help exporters remain compliant with India’s Foreign Trade Policy 2024.

Understanding Advance Authorisation License

The Advance Authorisation License is a scheme under the Foreign Trade Policy that permits duty-free import of inputs required for manufacturing export products. This significantly reduces import costs, making Indian exports more competitive in global markets.

An Advance Authorisation License comes with an Export Obligation (EO), meaning the holder must export goods of a certain value within 18 months from the date of issue. Within these 18 months:

• The first 12 months are designated for importing raw materials (import validity).
• The remaining 6 months are for manufacturing and exporting the final product.

If the exporter is unable to meet these deadlines, they may opt for revalidation of import validity or EO extension to avoid penalties.

What is Revalidation of Advance Authorisation License?

Revalidation refers to the extension of the import validity period of an Advance Authorisation License. If an exporter has not utilized the license within the initial 12-month import validity period, they can apply for revalidation, extending the period by an additional 12 months.

Key Points about Revalidation:

• Revalidation can be granted only once for a period of 12 months.
• The application must be submitted before the expiry of the original import validity period.
• A nominal fee of ₹500 is charged for revalidation.

What is the Extension of Export Obligation Period?

The EO period extension allows an exporter additional time to fulfill their export obligations. This is particularly useful when unforeseen circumstances delay shipments.

EO Extension Details:

• An Advance Authorisation License holder is eligible for two six-month extensions.
• The first six-month extension requires a composition fee as per the following structure:
  • Up to ₹2 crores license value: ₹5,000
  • ₹2 to ₹10 crores license value: ₹10,000
  • Above ₹10 crores license value: ₹15,000
• The second six-month extension requires:
  • Up to ₹2 crores license value: ₹10,000
  • ₹2 to ₹10 crores license value: ₹20,000
  • Above ₹10 crores license value: ₹30,000
• Further extensions require DGFT headquarters approval, subject to justification and payment of additional fees.

Documents Required for Revalidation & EO Extension

To apply for revalidation or EO extension, exporters must submit:

1.    ANF-4D application form

2.    Copy of the Advance Authorisation License

3.    Self-certified copies of shipping bills, bills of entry

4.    Justification letter explaining the need for an extension

5.    Proof of payment of composition fee

6.    Copy of previous extension/revalidation approvals (if applicable)

How to Apply for Revalidation and EO Extension?

Step 1: Prepare the Application

• Collect all required documents and complete the ANF-4D form.

Step 2: Submit the Application

• Submit the application to the DGFT Regional Authority.

Step 3: Respond to Deficiencies (if any)

• If DGFT requests additional details, respond promptly.

Step 4: Approval and Notification

• Upon approval, DGFT will issue a revalidation or EO extension order.

How A V International Can Help You?

At A V International, we specialize in Advance Authorisation License services, ensuring smooth revalidation and EO extension processes. Our expert consultants assist with:

• Advance Authorisation License revalidation
• EO extension and amendment
• License clubbing and enhancement
• Invalidation and redemption
• Bond cancellation and compliance

With over 700 exporters successfully assisted, we provide end-to-end support, from documentation to DGFT follow-ups.

For expert assistance, visit our website www.avigroup.in