DGFT amends Handbook of Procedures for issue of export authorization for “Stock and Sale” of SCOMET items


The Director General of Foreign Trade (DGFT) sets forth certain amendments to the Handbook of Procedures (HBP) of the Foreign Trade Policy (FTP) 2015-20. The amendments revise the applicability of the policy for export from the Indian subsidiary of foreign company (applicant exporter) to its foreign parent/another subsidiary of foreign parent company and allow repeat order authorization under the Stock and Sale policy. These amendments were issued through a public notice dated 17th January, 2023 and shall come into immediate effect.

The amendment states the conditions for consideration by the Inter-Ministerial Working Group (IMWG) of application for grant of authorization for bulk export of certain Special Chemicals, Organisms, Materials, Equipment and Technologies (SCOMET) items. Such bulk export contemplates export from an Indian exporter to an entity abroad for subsequent transfer to the ultimate end users.

Some of the conditions for consideration of the application by the IMWG are as follows:

  • Applicability and scope of policy

The policy applies to ‘stockist’ which refers to the entity abroad to whom the SCOMET items are originally exported by Indian principal/wholly owned subsidiary. The Stockist entity should be a subsidiary/principal company abroad of the Indian exporter;

Export shall be permitted from the Indian parent company (applicant exporter) to its foreign subsidiary company or from the Indian subsidiary of foreign company (applicant exporter) to its foreign parent/another subsidiary of foreign parent company and on the basis of an End Use declaration from the stockist, through the specified End User Certificate (EUC)for ‘stock & sale’ purpose.

  • Application for export to stockist abroad and transfer to end users in specific countries

The exporter must submit application in form ANF-2O along with prescribed documents from the stockist:

  • In-principle approval for export to the stockist, and, for sale by stockist within the country of the stockist, and, for re-export by stockist to end user in other countries

No authorization would be required for transfer from the stockist to the ultimate end user(s) within the country of the stockist and for re-export to end users in such approved countries;

  • Post-reporting for same country transfer and re-export to pre-approved countries by the stockist

In case of sale/transfer by the stockist within the same country and for re-export/re-transfer to the end users, the Indian exporter/licensee shall submit details of all such transfers to SCOMET Division of DGFT (Hqrs) in ANF-2 O(a). These details shall also include End Use-cum-End User Certificates (EUCs) from all ultimate end users. Further, where the export is outside the country of the stockist the Indian exporter/ licensee must also furnish the Bill of Entry into the ultimate destination countries. All of these details must be submitted within 3 months of every such transfer. These requirements are only applicable where the end users are in countries where in-principle approval has been granted.

  • Annual reporting on inventory of the stockist and transfers/re-exports

The Indian exporter (Stock & Sale Authorization holder) shall submit records of exports, transfers and inventory as on as on 31st December of each calendar year. These records shall pertain to the following:

a. a statement of exports made from India to the stockist,

b. transfers made by the stockist to the final end-users and

c. inventory with the stockist

These records shall be submitted by 31st January of the following year. A failure to do so may entail imposition of penalty and /or cancellation of authorization under the stock and sale policy.

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