Authorized Economic Operator
AEO is a trade facilitation scheme for ease of doing business in light of international development holder of this certificate is entitled for privilege, benefits, exemption and relaxation on account of import and export. This certificate is issued for particular period after that it has to be renewed.
Anyone involved in the international supply chain that undertakes customs related activity in India can apply for AEO status irrespective of size of the business. There is no provision to grant AEO status to specific site, division or branch of legal entity of applicant. The application must cover all the activities and locations of the legal entity involved in the international supply chain. Applicant must have minimum 25 transactions of import and exports in totality throughout the year.
There should be no show-cause notice issued to the applicant during last three financial years, involving fraud, forgery, outright smuggling and clandestine removal of excisable goods or cases where service tax has been collected from customers but not deposited to the Government.
There should be no case wherein prosecution has been launched or is being contemplated against the applicant or its senior management.
The ratio of disputed duty demanded or drawback demanded or sought to be denied, in all the show cause notices issued under the Customs Act, 1962 during the last three financial years, to the total duty paid and drawback claimed during the said period is not more than ten per cent.
The applicant must be financially solvent during the three financial years preceding the date of application and should not be listed currently as insolvent or in liquidation or bankruptcy.
There will be three tiers of certification i.e. AEO-T1, AEO-T2 and AEO-T3. To begin with, the application for Tier 1 would be the appropriate. Normally for obtaining status under AEO T2, physical verification of the premise(s)/place(s) by the AEO program manager is compulsory and only after physical verification of requirements specified in the application such as legal compliance, financial solvency, safety and security, the status of AEO T2 would be given.