An AEO is a business engaged in international movement of goods that must comply with national Customs law and WCO SAFE security standards. Approval by the national administration is required based on compliance with these standards. The Indian AEO program is based on WCO SAFE security standards.

The AEO program aims to identify safe and compliant businesses and provide them with facilitated customs clearance. This helps Customs focus on regulating risky businesses and secures the international supply chain by promoting best practices. The program is a collaboration between Customs and businesses, where businesses share responsibility for securing the supply chain and receive benefits in return. It encourages best practices and mutual cooperation to minimize risks and improve supply chain security, benefiting both Customs and businesses by enhancing security, reducing costs and facilitating trade.

The AEO Scheme of the WCO was developed in response to the terrorist attacks that occurred on September 11, 2001, which highlighted the potential risk of the supply chain being exploited for illegal activities. Governments around the world recognized the need to enhance supply chain security and ensure the safe movement of goods across borders.

The AEO Program began in India as a pilot project in 2011 through Circular No. 37/2011-Customs. Later, it was revised and the final version was introduced through Circular No. 28/2012 on November 16, 2012.

No, AEO status is optional and depends on the business’s position in the supply chain and desire to obtain its benefits.

The Indian AEO program has three tiers for importers and exporters: AEO-T1, AEO-T2, and AEO-T3, with increasing benefits and compliance requirements. Logistics providers, custodians, terminal operators, customs brokers, and warehouse operators have a single-tier program called AEO-LO certification.

AEO-T1 and AEO-T2 are valid for three years, while AEO-T3 and AEO-LO are valid for five years.

Yes, AEO certificate is valid at all Customs stations in India, which means AEO status holders will receive its benefits at all ports, airports, and land Customs stations.

Yes, all AEO Status holders including AEO T1, AEO T2, and AEO T3 are entitled for DPD / DPE facility.

No, the amount of Bank Guarantee is not automatically reduced to 50%, 25%, and Nil for T1, T2, and T3. CBIC Circular No. 38/2016 dated August 22, 2016, specifies the situations where the reduction applies, and it does not apply when a competent authority orders the submission of a bank guarantee for the provisional release of seized goods.

AEO T2 and AEO T3 status holders are eligible for deferred payment of duty scheme. As a part of this scheme, status holders can delink duty payment from Customs clearance. It is based on the principle ‘Clear First-Pay later’. Basically AEO T2 and AEO T3 status holders can delay the payment of customs duty by certain period of time.

To access deferred payment of duty, eligible importers must inform their intention to the Principal Commissioner of Customs or the Commissioner of Customs and register on the ICEGATE website at www.icegate.gov.in, following Rule 4 of the Deferred Payment of Import Duty Rules, 2016.

Yes, facilitation benefits will be available in countries with which India has signed Mutual Recognition Agreements (MRA). India’s Customs has signed MRAs with South Korea, Taiwan, and Hong Kong Customs, allowing reciprocal trade benefits.

Mutual Recognition Agreement is a bilateral trade agreement between two countries.

No, the AEO LO status is only valid and applicable to the applicant, not their importers or exporters. Importers and exporters must apply separately for AEO status.

The following Chief Commissioner of Customs offices are currently designated for processing AEO applications:

• Mumbai Zone-I
• Mumbai Zone-II
• Mumbai Zone-III
• Delhi
• Vishakhapatnam
• Patna
• Bhubaneswar
• Chennai
• Ahmedabad
• Hyderabad
• Kolkata
• Pune
• Tiruchirappalli
• Nagpur
• Bangalore
• Bhopal

AEO Applications has to be submitted online and physically at the respective customs jurisdiction offices.

Yes, they can reapply if the reasons for rejection are no longer valid and they meet the eligibility criteria.

An existing AEO certificate holder can apply for higher AEO
status. There is no time limit for filing higher status application except in case of AEO-T3.

No, there is no provision to grant a seperate AEO status to a specific branch, site or division of a legal entity

In general, an applicant for Indian AEO status must have business activities for at least three financial years before the date of application. However, in some exceptional cases where the AEO Programme Manager conducts a physical verification of a newly established business entity’s internal controls, they may consider it for certification.

Yes, MSMEs can apply for AEO all tiers including AEO T1, AEO T2, AEO T3 and AEO LO.