DGFT Release Drone Policy for Export under SCOMET

· DGFT invites comments from Industry for draft policy amendment of the Category 5B of SCOMET List and the General Authorization for Export of Drones/UAVs (Excluding Software and Technology) for specific types of drones/UAVs

· Comments on the draft Policy and GAED procedure are invited and may be sent to scomet-dgft@nic.in by 15.09.2022

[DGFT Circular Dated 30 August, 2022]

Proposed SCOMET Policy for export of drones/UAVs

· Amendment proposed in the SCOMET Category 5B

· Procedure for grant of General Authorization for Export of Drones (GAED)

· Post reporting for export / re-export of items under GAED

· Record Keeping

· General Conditions & Exclusions

· Validity

· Suspension / Revocation

Subject:- Circulation of proposed amendment in Category 5B of SCOMET List related to export of Drones/UAVs and General Authorization for Export of Drones/UAVs (GAED) , a SCOMET item for public/Industry comments.

With the aim to simplify the policy of Unmanned Aerial Vehicles (UAVs)/Drones under SCOMET list, a draft policy amendment of the Category 5B of SCOMET List and the General Authorization for Export of Drones/UAVs (Excluding Software and Technology) for specific types of drones/UAVs is proposed. The same is being circulated for the public/Industry comments and feedback.

The comments on the draft Policy and GAED procedure are invited and may be sent to scomet-dgft@nic.in by 15.09.2022

Proposed SCOMET Policy for export of drones/UAVs

A. Amendment proposed in the SCOMET Category 5B

5B Unmanned aerial vehicles including cruise missiles, target drones and reconnaissance drones and related equipment, and specially designed components therefor:

a. Complete unmanned aerial vehicle systems (including cruise missile systems, target drones, exclusive delivery drones, drones with encrypted/satellite communication, drones with surveillance (> 10x Zoom), explosive/warhead/electronic warfare payload capability and reconnaissance drones) or any technology or software related to it.

b. Complete unmanned aerial vehicle systems having an autonomous flight control and navigation capability or capability of controlled flight out of the direct vision range involving a human operator, designed or modified to incorporate an aerosol dispensing system/mechanism, with a capacity greater than 20 liters.

Technical Note: For the purposes of this entry, an aerosol consists of particulate or liquids other than fuel components, by-products or additives, as part of the payload to be dispersed in the atmosphere.

Note: This entry does not control unpowered airborne vehicles such as gliders, hot air balloons etc.

c. Associated launchers and ground support equipment;

d. Related equipment for command and control.

e. Light weight Turbojet and turbofan engines (including turbo compound engines).

f. Ramjet, Scramjet, pulse jet, combined cycle engines, including devices to regulate combustion, and specially designed components.

g. Safing, arming, fusing and firing mechanisms for weapons or warhead.

h. Production facilities and Production equipment specially designed for equipment or materials for 5B.

i. Technology, for the development, production or use of equipment, materials or software specified for 5B.

j. Software, for the development, production or use of equipment or materials specified for 5B.

k. Software which coordinates the function of more than one subsystem, specially designed or modified for use in the systems specified in 5B.

l. Turboprop engine systems’ specially designed for the systems in 5B(a), and specially designed components therefore, having a maximum power greater than 10 kW (achieved uninstalled at sea level standard conditions), excluding civil certified engines.

Technical Note: For the purposes of this entry, a turboprop engine system” incorporates all of the following:

i. Turboshaft engine; and

ii. Power transmission system to transfer the power to a propeller

Note: Unmanned aerial vehicle systems including drones, remotely piloted air vehicles and autonomous programmable vehicles, not specified under SCOMET Categories/sub-categories 3D013, 5B(a) & (b), 6A010, 8A912, and capable of range equal to or less than 5 km and delivering a payload of not more than 5 kgs (excluding the software and technology of these items), will not be covered for the purposes of SCOMET Category 5B, subject to the General Licensing procedure under GAED policy to be notified in the Public Notice.

B. Procedure for grant of General Authorization for Export of Drones (GAED)

A. Policy & Eligibility: SCOMET authorization will not be required, for export and/or re-export of Unmanned Aerial Vehicles including drones, remotely piloted air vehicles and autonomous programmable vehicles, not specified under SCOMET Categories/sub-categories 3D013, 5B (a) & (b), 6A010, 8A912, and capable of range equal to or less than 5 km and delivering a payload of not more than 5 kgs (excluding the software and technology of these items), subject to the following conditions

I. The applicant exporter shall submit an application for getting a onetime authorization under GAED through online SCOMET portal and attach information in proforma-ANF 2O;

II. The application would be reviewed/examined for the issuance of GAED by Inter-Ministerial Working Group (IMWG) based on the submitted application and other supporting documents submitted by the applicant exporter in the prescribed Performa including;

a. Detailed description of the items that are intended to be exported under this authorization with relevant technical details / specifications, such as model, part number, etc. to be provided (as applicable);

b. The EUCs in prescribed Performa are to be filled by all the entities involved in the chain of supply e.g. foreign buyer / consignee / end user / intermediary (ies) on the letterhead of the respective entity, duly signed in ink and stamped by the authorised signatory of the company. In case of any additional sheet used along with the EUC, the same must be on the letterhead of the company and signed by the same person who signs the EUC.

c. Undertaking on the letterhead of the firm duly signed and stamped by the authorized signatory stating the following:

i. Any on-site inspection will be allowed by the applicant exporter, if required by the DGFT or authorized representatives of Government of India;

ii. The applicant exporter declares that the items that are intended to be exported shall not be used for any purpose other than the purpose(s) stated in the EUC and that such use shall not be changed nor the items modified or replicated without the prior consent of the Government of India.;

iii. The applicant exporter declares that subsequent to issue of export authorisation, if the licensee has been notified in writing by DGFT or if they know or has reason to believe that an item may be intended for military end use or has a potential risk of use in or diversion to weapons of mass destruction (WMD) or in their missile system, the exporter would not be eligible for GAED for export of that/those item(s) and would apply separately to DGFT for a fresh authorization in terms of regular policy.

iv. Action will be taken against the exporter under FT (D & R) Act, 1992 for any mis-declaration.

d. After issuance of GAED authorization and before actual export, the applicant exporter must ensure the following:

i. They shall notify the relevant government authorities in the online portal of DGFT, on quarterly basis of such export in the prescribed format [Aayat Niryat Form (ANF) - 2O], along with the End-Use Certificate (EUC) in the prescribed proforma [Appendix 2S(ii)] and a copy of the bill of entry into the destination country.

ii. They have an agreement or a purchase order, excerpt of contract from entity (consignee / end user) receiving the items which states that the export is for a permitted use / an end use as declared in the EUC before actual export;

iii. They possess documents include the name, contact number and email id of the authority signing the EUC before actual export.

iv. Additional details, if any sought by DGFT

B. Post reporting for export / re-export of items under GAED

a. The Indian exporter shall submit post-shipment details of each export/ re- export of SCOMET items under the above Categories/ sub-categories under GAED for 3 years, as mentioned above at II.c. (i) and within the timelines specified therein;

b. Failure to do so may entail imposition of penalty and / or suspension/revocation of GAED.

C. 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 GAED issued by DGFT.

D. General Conditions & Exclusions

a. GAED would not be issued in case of items to be used to design, develop, acquire, manufacture, possess, transport, transfer and / or used for chemical, biological, nuclear weapons or for missiles capable of delivering weapons of mass destruction and their delivery system;

b. GAED would not be issued for countries or entities covered under UNSC embargo or sanctions list or on assessment of proliferation concerns, or national security and foreign policy considerations, etc.;

c. IMWG shall reserve the right to deny issue of GAED without assigning any reason(s).

E. Validity

GAED issued for export / re-export of SCOMET items under the above Categories / Sub Categories shall be valid for a period of Three years from the date of issue of GAED subject to subsequent post reporting(s) on quarterly basis to be reported within 30 days from the last quarter; GAED cannot be revalidated in terms of Paragraph 2.80 of HBP of FTP 2015-20.

F. Suspension / Revocation

GAED issued shall be liable to be suspended / revoked by the DGFT on receipt of an adverse report on proliferation concern or for non-submission of mandatory post-shipment details / reports / documents within the prescribed timelines or for non-compliance with the conditions of the proposed policy.