Purpose and applicability of AEO Certification in India

Authorized Economic Operator (AEO) is for the purpose to facilitate trade schemes with the objective to ease the business process with respect to international development. AEO Certification was executed in 2011 by Central Board of Indirect Taxes & Customs (CBIC). AEO must comply with the National Customs regulation and is sanctioned by the national organization and with World Customs Organization (WCO).

What is AEO Certification in India?

The AEO Certification provides rationalise procedure for customs and has simplified the process of custom clearances to the business organisations offering higher degree of security guarantees in respect of their role of supply chain. The primary purpose of AEO scheme is to follow the standards of sharing of the role and obligation between customs, industry & trade. The major objective is to delink the clearance and payment by increasing efficiency and accept paperless declaration. The Customs launched three tiers of the AEO Certification for Importers and Exporters i.e. AEO T1, AEO T2, and AEO T3.

What is the purpose of AEO Certification?

The major purpose of AEO Certification in India is to:

1. Reduce the inspection and examination on import & export and to accept the import declarations before its arrival.
2. It offers businesses with an internationally acknowledged security standards, and upholds an AEO certified organisations as a secure and trustworthy trade partners.
3. The purpose is to ease the acceptance of export declaration as the goods are exported in the Customs locations.
4. To simplify the approval request of warehouse operators to establish a new warehouse.
5. It encourages AEO organisations with well-defined benefits that gives them more savings and in return avoids time loss and increases costs that enhances the business competitiveness.
6. The AEO certification has helped businesses to boom as it has created less restrictions which has increased the trade transaction process and accelerated growth in business.
7. The purpose of AEO status is to make relations with all international businesses much better and to promote sense of authenticity in the trading industry with entities that hold AEO certification.

Applicability of AEO Certification

According to Section 3 the applicability AEO Certification in India is:

1. It must be a custom related business entity of India.
2. The business entity has handled minimum 25 documents related to customs which can include either bills of entry or the shipping bills of the previous financial year.
3. The business is doing the customs activity for minimum three financial years.
4. The business should not have been involved in fraud, forgery, clandestine, smuggling, removal of the excisable goods, or has not deposited the service tax with the government in the previous three financial years.
5. Before submitting the AEO application, the business has to be financially solvent for the previous three financial years.
6. It is applicable on Exporters & importers, logistic providers like carriers & airlines, port operators, terminal operator, stevedores warehouse operators, custodians, agents of Custom house agents, couriers, etc

How ASC can help you?

The committed team of expert at can help you in obtaining AEO certification and providing advisory in complete process of online application, documentation, physical verification, follow up with Custom for certification and in retaining the AEO status. ASC follows end to end approach for obtaining AEO Status right from the planning and readiness assessment stage till getting the final approval of AEO status