Assessment of the Authorised Economic Operator (AEO) Scheme

An Assessment of the Authorised Economic Operator (AEO) Scheme

Objective:

The instant study is being conducted with the objective to present a comprehensive assessment of the Authorised Economic Operator (“AEO”) programme of the Central Board of Indirect Taxes and Customs (CBIC). Recognising that AEO scheme not only fulfils a commitment under the Trade Facilitation Agreement (TFA), this trust-based scheme must lie at the core of a robust economic reform initiative. Public policy has been found to be immensely more impactful when it is designed on the basis of evidence and feedback.

Therefore, as part of this study, we, with our knowledge partners Deloitte India propose to undertake a detailed questionnaire-based survey, with those who have enrolled under the three-tiered scheme and those who have not to elicit the stakeholders’ assessment of the benefits, challenges and costs so as to make recommendations to the Government to further improve the attractiveness and effectiveness of the AEO scheme. In view of the specific objective of this study and to bring greater precision to the exercise, this study does not cover AEO-LO, even though they play an important role in trade facilitation.

With the above objective, survey questionnaire has been formulated, with Section 1 comprising questions with multiple options. However, recognising that this approach may not be adequate to elicit detailed stakeholders’ insight, in Section 2, subjective questions have been posed for qualitative answers.

We would also welcome the opportunity to get more detailed responses and comments either through email or a telephonic interview with the team leaders.

Upon analyses of the responses, we propose to discuss the same with domain experts before formulating appropriate actionable recommendations to the Government.

Section 1:
Sub-Section A: General

Name*

Email*

Company / Organisation*

1. Are you engaged in following activities?

Only Import Both Import and Export

2. Which ports do you handle import/export clearance through? Please list them in order of your importance.

Seaports

Air cargo

ICD

LCS/ICP

3. How many bills of entry do you submit during a week?

1-5 6-10 11-15 More than 15

4. How many shipping bills do you submit during a week?

1-5 6-10 11-15 More than 15

5. Are you an AEO client?

YES NO

6. If yes, when did you enrol under the scheme?

Before 2017 2017-19 2019-21 After 2021

7. If you are an AEO client, are you -

Tier 1 Tier 2 Tier 3 Covered by MRA

9. What is your level of satisfaction with the AEO programme?

Absolutely satisfied Largely satisfied Just satisfactory Not satisfied

10. If you are an AEO client, are you happy with the benefits provided?

YES NO

11. If you are not an AEO client, what is the reason?

Lack of information regarding the scheme Cumbersome enrolment process High compliance burden Relatively low benefits Any other reason [Please explain]

Sub-Section B: Application Process

12. Whether current AEO application process is conducive to ease of business?

YES NO

13. Did you find the AEO application process to be clear and well-documented?

Yes, the process was very clear. It was somewhat clear but could be improved. No, the process was confusing and unclear. Not aware of the process.

14. Were there any specific challenges or difficulties you encountered during the AEO application process?

No significant challenges. Some challenges related to documentation or information. Substantial challenges that significantly affected the process.

Please elaborate on the challenges.

15. How would you rate the responsiveness of the authorities overseeing the AEO application process?

Very responsive, with timely assistance. Adequate responsiveness, but room for improvement. Poor responsiveness, resulting in delays or issues.

16. Did you receive adequate support and guidance from customs authorities/ AEO officers during the application process?

Yes, excellent support and guidance. Some support, but it could be more helpful. No or minimal support received.

17. How long did it take for your AEO application to be reviewed and approved/rejected?

Quickly, within a reasonable time-frame of ninety days. It took longer than expected. The process was excessively delayed beyond six months.

18. During the financial solvency assessment, were the various criteria as prescribed under the Circular referred to and analysed?

Yes, all criteria were taken into consideration No, only current ratio aspect was considered

19. During the application scrutiny, were the notices having fraud, misrepresentation or suppression allegations were investigated in detail by AEO officers? What was the impact on AEO application?

Yes, a fair analysis of allegation was done, and application was approved Yes, a fair analysis of allegation was done, and application was rejected No, mere invoking of these allegation led to rejection

20. Overall, how would you rate your experience with the AEO application process?

Very positive and efficient It had both positive and negative aspects. Overall, it was a challenging and negative experience.

21. What are your top 3 recommendations for further simplify AEO application process?

Sub-Section C: Customs facilitation

22. Have you noticed a difference in customs facilitation since obtaining AEO status?

Yes, there has been a noticeable improvement. There has been some improvement, but it could be better. No significant change in customs facilitation.

23. What is the percentage of Bill of entry and Shipping Bill cleared under fully facilitated vis-à-vis non-facilitated?

>75% >50% but <75% >25% but <50% <25%

24. How often has the status of your bill of entry been changed from fully facilitated to non-facilitated?

Very rarely Occasionally Frequently

25. Have you experienced fewer cargo inspections or examinations of your shipments as an AEO?

Yes, significantly fewer inspections/examinations. Fewer inspections, but it varies. Inspections/examinations have not decreased noticeably.

26. As an AEO client, what has been your experience with faceless assessment system?

Mostly good Generally good Generally bad Mostly bad

27. Are there specific customs procedures that have become more streamlined for your organization as an AEO?

Yes, please specify the procedures. Some procedures have improved, but not all. No significant changes in customs procedures

28. Whether the facility to paste MRP stickers in the premises was given?

Yes No Not always

29. Whether separate space has been marked for AEOs at the port?

Yes No

30. As an AEO, how long does it typically take to process a Bill of Entry?

Less than 1 day 1 – 2 days 2 – 3 days More than 3 days

31. Whether Bills of Entry selected for assessment/examination are processed on priority?

Yes No

32. What percentage of your containers are selected for scanning/examination?

33. Are you facing any challenge in availing the Deferred duty benefit, being an AEO?

No Yes, please specify the challenges faced

34. Whether you have experienced increased facilitation for certification requirements under allied laws, being an AEO?

Yes No

35. As an AEO client what further facilitation would you want?

With respect of import clearance With respect to export clearance With respect to dealing with the PGAs

36. If you are not happy, what is the main reason?

High compliance burden Relatively low benefits Any other reasons.

37. Are you aware that under AEO programme, Customs is required to appoint a client relationship manager?

Yes No

38. Whether a Client Relationship manager has been appointed for your jurisdiction and was it helpful?

Appointed and helpful Appointed but not helpful Not appointed

Sub-Section D: Meeting service level commitments

39. Whether are you aware about other service level commitments (apart from customs facilitation) to be provided to AEO status holder?

Yes No

40. Have you experienced the benefits promised under the AEO program, such as the requirement for the grant of refunds prescribed limit (45 days for T2 & 30 days for T3)?

Yes, refunds have been granted within the specified timeframe. Refunds have been granted, but not consistently within the timeframe. Refunds have not been granted within the specified timeframe.

41. Whether AEO status has resulted in expedited investigations?

Yes, investigations have been completed within the specified timeframe. Investigations have been completed, but not consistently within the timeframe. Investigations have not been completed within the promised timeframe.

42. Whether AEO status expedited dispute resolution?

Yes, disputes were adjudicated within the specified timeframe. Disputes were adjudicated, but not consistently within the timeframe. Disputes were not adjudicated within the promised timeframe.

43. Whether waiver on bank guarantee as promised under AEO programme been provided?

Yes No

44. Have post-clearance audits been implemented as opposed to live transactional audits, as promised under the AEO program?

Yes, post-clearance audits have been implemented. Post-clearance audits have been implemented, but not consistently. Post-clearance audits have not been implemented as promised.

45. Whether other benefits as promised under AEO programme been provided?

Yes – please specify No

Sub-Section E: Miscellaneous

46. Do you feel being AEO status holder has resulted into facilitation such as timely adjudication, priority in meetings with relevant authorities?

Yes No

47. Whether you have experienced reduction in litigation/ disputes on routine matters on account AEO status?

Yes No

48. Whether AEO ID cards have been issued to you on account of attaining AEO status?

Yes No

Section 2:

49. In your view what measures could streamline the process of obtaining AEO enrolment or migrating to higher tier?

50. In your view what other facilities could be granted by the Customs Department under the AEO programme to make the programme more attractive?

51. Do you have any suggestions to reduce the compliance burden, including during the regular prescribed audit?

52. Do you any suggestions for AEO programme for increased facilitation from allied laws perspective?

53. Do you have any suggestions to make AEO programme more attractive to exporters?

Section 3:

54. Will you be willing to give us 30 minutes telephonic interview time to better appreciate your survey responses or any other feedback?