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Engagement with DGFT, MEITY, MEA: Review of GAICT policy
Engagement with DGFT, MEITY, MEA: Review of GAICT policy

June 22, 2021

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On June 18, 2021, NASSCOM engaged with the concerned officials of Directorate General of Foreign Trade (DGFT), Ministry of Electronics and Information Technology (MeitY) and Ministry of External Affairs (MEA), to bring forward industry’s suggestions related to the review of the Global Authorisation for Intra-Company Transfer (GAICT) policy.  

Further, additional inputs have been submitted on the following points:

  1. Delete the requirement that the use of an item which is re-exported under GAICT shall not be further changed, nor the item modified or replicated without the prior consent of the Government of India (under Appendix 2 S (iv)), as this is in contradiction to paragraph F of Public Notice 20 which states that further re-export/re-transfer of the item/software/technology from the foreign parent company or its subsidiary to end users in other countries would be subject to the export control regulations of the country of the foreign parent company or its subsidiary.
  2. Revise the scope of GAICT policy to not restrict the eligible services performed in India before export/re-export of items/software/technology. We have requested that the the language of clause paragraph 2.79F (A)(ii)(b) of Public Notice 20, should be modified so that it is clear that the list of services mentioned in the said clause are only illustrative, not exhaustive.
  3. Uniform and consistent mention of ‘exports and/or re-exports’ throughout the revised GAICT policy. This is in furtherance of the industry's suggestion to include exports and re-exports under the scope of GAICT policy. 
  4. Clarify that a time period of import and export is sufficient instead of the exact date of import and export, under Table 3(i) of ANF 2O (c). This is because it is difficult for the industry to specify the exact date and instances of re-export of certain technology/software, due to its intangible nature.
  5. Clarify as to how should the value of re-exported software/technology be specified by the industry, in the case of transfer of software/technology which is not in the final executable form, under Table 3(iii) of ANF 2O (c). This is because most often intra-company transfers are carried out to perform research and development services on an intermediate software, in which case it is not possible to attach a value to the software/technology being worked upon.

 

Background to GAICT:

 

On July 24, 2019 the DGFT vide Public Notice 20 inserted Para 2.79F to the Handbook of Procedures of the Foreign Trade Policy (FTP) 2015-20 which introduced the GAICT policy. Under the GAICT policy, eligible exporters do not require pre-export authorisation for intra-company re-export of imported SCOMET items, software and technology under certain SCOMET categories. Thereafter, on March 17, 2020, DGFT, vide Public Notice No. 65/2015-20 issued application form (ANF 2 O (b)) and end use certificate (EUC) for further implementation of the GAICT policy.

NASSCOM has been engaging with the GFT regularly, to bring about reforms in the GAICT policy. Our submissions for the review of the GAICT policy can be found here and here.  

For more information, kindly write to garima@nasscom.in. 


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Garima Prakash
Manager, Public Policy and Government Affairs

Reach out to me for all things policy about e-commerce, international trade, export controls, start-ups and fintech

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