Why Your AEO Status is Important and How to Get It?

Authorized Economic Operator (AEO) is a status certification programme by the Director-General of Foreign Trade (DGFT) office under FTP, proven compliance with the “World Customs Organization (WCO) SAFE Framework of Standard” to secure trades and provide international recognition. 

Importance of AEO Programme:

AEO is a voluntary programme, which enables Indian customs to follow streamlined cargo protection in accordance with WCO through cooperation with principal stakeholders and the international supply chain consisting of importers, traders, logistics suppliers, and warehouse operators. Having the AEO status can lead to better customer confidence by ensuring quicker and safer security progress with better security from theft and losses in transit. The status also shows that you take communication and security seriously.

There are four AEO tiers introduced by the AEO programme team, namely T1, T2, T3, and AEO LO. While T1, T2, and T3 are specifically designed for importers, AEO LO is for logistic providers. 

The process of the AEO applications is decentralized with the T1 application process being online requiring only document verification, T2 and AEO LO applications requiring document and onsite verification through the customs office. T3 application is for those T2 holders, who have enjoyed the status for at least 2 years continuously. 

Benefits of AEO Status:

The major benefits of AEO are as follows:

1. Self-declaration of Standard Input Output Norms (SION) in case SION is not notified.
2. Inclusion of Direct Port Delivery of imports, ensuring just-in-time inventory management by manufacturers.
3. Inclusion of Direct Port Entry for factory stuffed containers.
4. ID cards for AEO status holders for entry to Customs House, CFS, and ICD.
5. Fast-Tracked Investigation
6. Dispute resolution related to AEO status holder to be completed within 6-9 months.
7. An automated email regarding the arrival/departure of the concerned vessel.
8. Faster disbursal of drawback amount.
9. The examination shall be done on a priority basis.
10. Faster disbursal of refund, including IGST.
11. Automatic activation of Deferred Duty Payment option for AEO – T2 and AEO T3 status holder.
12.  Benefits of Mutual Recognition Agreements with other Customs Administrations for AEO T2 and AEO T3.
13. Extension of facilitation to exports in addition to imports.
14. Request based on-site inspection /examination
15. Paperless declarations with no supporting documents.
16. Recognition by Partner Government Agencies and other Stakeholders. 

Eligibility Criteria to Apply for AEO Programme:

Any legal entity undertaking customs-related work can apply for the status if they have fulfilled the minimum requirements such as:

• They have handled at least 25 Import and Export documents in the last financial year.
• They have had continuous business activity for the last 3 financial years. This criterion can be waived off by the AEO programme manager.
• The applicant must the financially solvent for the last 3 financial years.
• The applicant must be cleared off of any financial fraud or alligations during the last 3 financial years.

How A V International Can Help:

Initially, A V International start helping you by arranging all the documents like:

• IEC Certificate
• GST Certificate
• MSME Certificate
• Certificate of Incorporation
• Pan Card Copy
• Audit Report for Last three years
• Declaration on Letterhead
• List of Import items with HSN code and country of import
• List of Export items with HSN code and country of export

Additionally, providing you with standard operating procedures for safety and security plans and an import-export process map for goods movement.

Following the document preparation and assisting you with the information, A V International starts the processing of applications for the AEO programme by

• Assisting you with an application form.
• Providing clarification for queries raised by the AEO office.
• Assisting in physical verification.
• Following up with the AEO Programme team to get the status to ensure a smooth and hassle-free AEO certification.