Intra-Company Transfer of Software Allowed in
SCOMET
[DGFT Public Notice No. 20
/2015-20 dated 24 July 2019]
Effect of this Public Notice: Paragraph 2.79F has
been inserted in the Handbook of Procedures (HBP) of the Foreign Trade
Policy (FTP) 2015-20 to lay down the procedure for issue of Global
Authorisation for Intra-Company Transfer (GAICT) of SCOMET
Items/Software/Technology.
Subject:
Inclusion of Paragraph 2.79F in the Handbook of Procedures of the Foreign Trade
Policy (FTP) 2015-20 to lay down the procedure for Global Authorisation for Intra-Company
Transfer (GAICT) of SCOMET items/software/technology
In
exercise of the powers conferred under Paragraph 1.03 of the Foreign Trade
Policy (FTP) 2015-20, the Directorate General of Foreign Trade (DGFT) hereby
makes amendments to Handbook of Procedures (HBP) of FTP 2015-20 for inclusion
of a new entry at Paragraph 2.79 with immediate effect.
2. After sub-Para 2.79E
of the HBP of FTP 2015-20, a new entry shall be inserted as under:
|
"Para 2.79F- |
Global Authorisation for Intra-Company
Transfers (GAICT) of SCOMET1 Items/Software/Technology |
A.
Scope and Eligibility: Pre-export authorization will not be
required for re-export of imported SCOMET items, software and technology [excluding
items under SCOMET Categories 0, 1B, 1C2 , 3A401,
5 and 6] under following conditions:
i. where the re-export is an Intra-company transfer
from an Indian subsidiary (applicant exporter) to its foreign parent company and/or
to subsidiaries of the foreign parent company for re-export of imported SCOMET
items (covered under para 2.A above) from India and;
ii. where the transfer
fulfils the conditions mentioned at (a) to (g) below:
(a) The
items/software/technology to be re-exported, by Indian subsidiary, have been
imported under a License Exception available in the country of the parent company
abroad or from subsidiaries of the parent company abroad;
Note:
The license exception should clarify the control list cla
ssification, equivalent to the SCOMET item number and
whether the licence exception is available for the
subsidiaries of the parent company abroad;
(b) The items/software/technology
to be re-exported is based on a Master Service Agreement I Contract between the
parent company and the Indian subsidiary for carrying out certain services including
design/encryption/research/ development/delivery/validation/testing;
Note:
As a result of the service carried out by the Indian
exporter, the items/software/technology should not undergo change in
functionality and classification.
c) These items/software/technology is/are to be re-exported to the foreign parent company and I or
subsidiaries of foreign parent company;
d) The applicant exporter declares that the re-exported
items would be used for the purposes for which it is
intended by the parent company and/ or its subsidiaries;
1 Special Chemicals
Organisms Materials, Equipment and Technologies listed in Appendix 3- SCOMET to
Schedule 2 Export Policy
2 for re-export to
States not party to Chemical Weapons Convention (CWC)
e) The exporter furnishes either
a certified/approved Internal Compliance Programme (ICP)
or demonstrates compliance to the ICP of the parent company;
f) The exporter agrees to allow on-site
inspection, if required by the DGFT or authorised
representatives of Government of India;
g) The exporter is granted a Global Authorisation
for Intra-Company Transfers (GAICT) as per procedure mentioned in para 2.B
below.
B.
Procedure for grant of Global Authorization for Intra-Company Transfers (GAICT)
Filing
and Assessment of Application
a. In respect of re-export of SCOMET
items/software/technology against Licence Exception which
has been granted by the export control licensing authority of the country of
parent company, the Indian exporter shall submit application for GAICT through online
SCOMET portal and attach information in proforma -ANF
20(b);
b.
The application would be assessed for the
issue of GAICT by Inter-Ministerial Working Group (IMWG) based on the submission
of the application and other supporting documents by the Indian exporter in the
prescribed proforma:
i. Documentary proof of the corporate relationship
between the foreign parent company and /or its subsidiaries abroad with the Indian
subsidiary (applicant exporter);
ii. Copy of Master Service Agreement (MSA) I
Contract and other related documents (if any), as may be relevant, between the foreign
parent company and the Indian subsidiary;
iii.
Classification of
item/software/technology in SCOMET (indicating SCOMET category and
sub-category);
iv. Detailed description of the item intended to be
re-exported with relevant technical details, such as model, part number, etc.
and in case of software/technology, details of encryption algorithm, key length,
encryption functionality, eligibility under cryptography note etc. to be
provided;
v. Documentary proof of licence
exception granted by the export control licensing authority of country of the foreign
parent company and the subsidiaries of the parent company in different
countries where it is valid;
vi. Certified/approved ICP of the exporter or
self-certified copy of the ICP of the parent company being adopted by Indian
subsidiary/exporter along with an undertaking thereon;
vii. Additional details, if any sought by DGFT.
C.
Post reporting for re-export of items/software/technology under GAICT
a.
The Indian exporter shall submit
post-shipment details of each transfer/consignment of exports of SCOMET
items/software/technology under GAICT to the SCOMET Division of DGFT (Hqrs) New Delhi, via E-mail (scomet-dgft-pr@nic.in) on
quarterly basis (March I June I September I December) by the end of subsequent
month of each quarter, in respect of the exports made in the previous quarter;
b. The post-shipment details shall be submitted in
proforma ANF 20(c ) along with
a copy of EUC in Appendix 2S (iv) from the parent company abroad;
c. Failure to do so may entail imposition of
penalty and I or suspension/revocation of GAICT.
Note:
ANF ( Aryat Niryat Form) - ANF 20(b), ANF 20(c) and End Use Certificate
proforma Appendix 2S (iv) would be notified
separately.
D.
Record Keeping
The
exporter will be required to keep records of all the export documents, in
manual or electronic form, in terms of Para 2.73 (c) of HBP, for a period of 5
years from the date of GAICT issued by DGFT.
E.
General conditions
a. GAICT would not be issued in case of item/software
and I or technology to be used to design, develop, acquire, manufacture, possess,
transport, transfer and I or used for chemical, biological, nuclear weapons or
for missiles capable of delivering weapons of mass destruction and their
delivery system;
b. GAICT would not be issued for countries or entities
covered under UNSC embargo or sanctions list or to the countries or entities assessed
for risk of proliferation concern, based on national security and foreign
policy considerations;
c. IMWG
shall reserve the right to deny issue of GAICT without assigning any reason(s).
F. Subsequent
re-exports Ire-transfer of the item/software/technology from the foreign parent
company or its subsidiary to end users in other countries
Further
re-export I 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.
G.
Validity
a)
GAICT issued for intra-company transfers of SCOMET items/software/techno ogy shall be valid for a period of three years from the
date of issue of GAICT by DGFT and shall be further subject to the following
validity time line, whichever is earlier:
i. Till the validity of license exception of foreign
parent company for that product (Items/Software/Technology); or
ii. Till the validity of license exception of
foreign parent company for subsidiaries of the parent company abroad; or
iii. Till the validity of Master Service Agreement (MSA)
I Contract with the foreign parent company and the Indian subsidiary.
b) GAICT cannot be revalidated
in terms of Paragraph 2.80 of HBP of FTP 2015-20.
H.
Suspension I Revocation
GAICT
issued shall be liable to be suspended I revoked by the DGFT on receipt of an
adverse report on proliferation concern or for non-submission of mandatory reports
within the prescribed time lines or for non-compliance with the conditions of
this Public Notice.
[Issued
from F.No.01/91/180/18/AM-17/EC]