DGFT Introduces Inventory-Based Cross-Border E-Commerce Export Framework, FTDR Amended

· Notification Issued: DGFT has issued Notification No. 27/2026-27 dated 5 August 2026, introducing an Inventory-based Cross-border E-Commerce Export Framework under the Foreign Trade Policy (FTP) 2023 with immediate effect.

· Legal Basis: The notification has been issued under Section 5 of the Foreign Trade (Development & Regulation) Act, 1992, read with Paragraph 1.02 of FTP 2023.

· Purpose: The framework enables export-only inventory operations through a registered Exporter-on-Record (EoR), facilitating Indian sellers' access to global markets through e-commerce.

· Exporter-on-Record (EoR):

o Must possess a valid IEC and GSTIN.

o Must be registered with DGFT under the framework.

o Procures goods from one or more Sellers-on-Record (SoRs) and exports them to overseas buyers.

o Where an e-commerce entity undertakes export-only inventory operations under the Consolidated FDI Policy, it must do so through a separate legal entity, disclosing its shareholding and ownership/control relationship.

· Seller-on-Record (SoR): A GST-registered entity in India supplying domestically produced goods to the EoR against confirmed export orders.

· Export Inventory Defined: Goods procured against confirmed export orders and held exclusively for export, with complete designation, recording and traceability.

· Domestic Inventory Defined: Goods held by the Seller-on-Record for supply within the Domestic Tariff Area (DTA).

· Export Rebates and Refunds (ERR):

o Includes Duty Drawback, RoDTEP, RoSCTL, and other cash or cash-equivalent export incentives.

o Excludes Advance Authorisation and EPCG Authorisation benefits.

o GST refunds remain an entitlement of the Exporter-on-Record.

· Objective of the Framework: To facilitate inventory-based e-commerce exports where the EoR undertakes procurement, inventory management, exports and export-related processes on behalf of Indian sellers.

· Eligibility Conditions:

o Only non-marketplace e-commerce entities may undertake export-only inventory operations through a registered EoR.

o Only goods of Indian origin are eligible.

o Seller-on-Record is responsible for declaring the correct origin.

o DGFT may notify ineligible goods from time to time.

· Restriction on Inventory Build-up: Transfer of title from the Seller-on-Record to the EoR can occur only against a confirmed export order. Speculative inventory build-up is prohibited.

· Inventory Management Requirements:

o EoR must maintain separate, identifiable and traceable export inventory.

o A digital repository must be maintained for procurement, inventory status and linkage with export documentation.

o Detailed procedures will be prescribed in the Handbook of Procedures.

· Payment to Sellers:

o EoR must pay the Seller-on-Record within seven days of acceptance (or deemed acceptance) of goods.

o Payment cannot be delayed because of delayed payment from foreign buyers or return of goods.

· Sharing of Export Benefits:

o EoR is entitled to claim export rebates and refunds.

o Such benefits must be apportioned among Sellers-on-Record based on the FOB value of their goods in the Shipping Bill.

o EoR may retain an administrative charge, while the remaining seller-attributable benefits must be passed on to sellers.

o The obligation arises only after the EoR actually receives the export benefits.

· Reverse Logistics:

o EoR is responsible for managing returns and rejected consignments.

o Returned goods cannot be sold in the domestic market.

o Reverse logistics costs must be borne by the EoR.

· Use of E-Commerce Export Hubs (ECEHs): EoRs should, wherever practicable, utilise notified E-Commerce Export Hub infrastructure, subject to operational readiness and capacity.

· Overall Impact: The framework creates a structured regulatory mechanism for inventory-based cross-border e-commerce exports, defining responsibilities of Exporters-on-Record and Sellers-on-Record, prescribing inventory traceability, ensuring timely payments to sellers, regulating sharing of export incentives, and strengthening compliance with the Consolidated FDI Policy.

[DGFT Notification No. 27/2026-27 dated 5 August, 2026]