Overview
Advance Authorization under Self-Declared norms is a type of Advance Authorization which provides a route for obtaining an Advance Authorisation, for eligible inputs, where the export product is not covered by an existing SION or any valid ad hoc norms. It is also applicable in cases where an existing SION or ad-hoc norm does not cover additional inputs that the exporter intends to use in the manufacturing process.
Under Para 4.07 of the Handbook of Procedures (HBP), 2023, the Regional Authority (RA) may issue the Advance Authorisation based on the applicant's self-declaration, without waiting for the Norms Committee to first fix the input-output norms. The applicant must, however, submit an undertaking to abide by the subsequent decision of the Norms Committee.
This means that the applicant can proceed with the Authorisation based on its proposed input-output ratio, but the declared norms are subject to subsequent scrutiny by the Norms Committee. If the Committee revises or rejects the declared norms, the applicant is required to pay the applicable duty and interest within the prescribed period. Hence, in this context, the initial authorization issued by the RA should be considered only as a provisional authorization (till it is approved by the Norms Committee).
Self-declaration is therefore particularly useful where an exporter needs an Advance Authorisation but there is no suitable SION or valid ad hoc norm and waiting for prior norms fixation would delay the transaction.
Key facts
- Scheme: the Self-Declared Advance Authorisation route is available under Para 4.07 of HBP, 2023.
- Administering authority: the Regional Authority may issue the Advance Authorisation based on the applicant's self-declaration.
- Eligible exporters: Manufacturer Exporters, and Merchant Exporters tied to a Supporting Manufacturer.
- Ineligible imports: the list of ineligible import items is covered under Para 4.11 of the FTP, 2023.
- When can it be used: where there is no existing SION or valid ad hoc norms for the export product; or where a SION/ad hoc norm exists but the exporter proposes to use additional inputs in the manufacturing process.
- Norms are subject to subsequent review: the applicant must undertake to abide by the subsequent decision of the Norms Committee, even though the Advance Authorization has been issued by the Regional Authority.
- Wastage: wastage claimed by the applicant is also subject to the wastage norms ultimately decided by the Norms Committee.
- Financial consequence of revision/rejection: if the Norms Committee revises or rejects the declared norms, the applicant must pay the applicable duty and interest as notified by the Department of Revenue (DoR) within 30 days from the date on which the Norms Committee's decision is hosted on the DGFT website.
- Timeline for Norms Committee decision: there is no fixed statutory timeline for the Norms Committee to approve the self-declared norms. The actual time may vary depending on the complexity of the product, completeness of technical/consumption data and any inter-ministerial or technical consultation required.
Benefits and risk in the self-declared norms
Advance Authorisation under self-declared norms offers the following benefits:
Faster issuance of Advance Authorisation
The principal practical advantage is that the exporter does not have to wait for the Norms Committee to first fix the norms before the RA can issue the Authorisation. This can be particularly useful where an exporter has an immediate export order and requires duty-free import of inputs.
Useful where no SION or ad hoc norms exist
If DGFT has not notified a SION for the export product, self-declaration provides a mechanism to seek Advance Authorisation without first obtaining an applicant-specific ad hoc norm.
Useful for additional inputs
Where an existing SION or ad hoc norms do not cover all the inputs proposed to be used in manufacturing, Advance Authorization under self-declared norms specifically provides a route for declaring the additional inputs.
Avoids waiting for prior norms fixation
The exporter can proceed with the Authorisation process based on its own proposed norms, subject to the undertaking to abide by the subsequent Norms Committee decision.
Risk of subsequent norms revision: the advantage of quick issuance of the authorization comes with a norms-ratification risk. If the Norms Committee subsequently reduces the permitted quantity or rejects the declared norm, the exporter may have to pay the applicable duty and interest. Hence, self-declaration should not be viewed simply as a way to obtain a quick Advance Authorisation.
An illustrative example
A manufacturer develops a new engineering product for export. The manufacturing process uses three permitted imported raw materials, but there is no SION or valid ad hoc norm covering the particular export product.
The manufacturer calculates its actual input consumption and determines that, for every 1,000 kg of finished export product, it requires:
- 1,100 kg of Input A;
- 250 kg of Input B; and
- 50 kg of Input C.
Instead of first applying to the Norms Committee for fixation of an ad hoc norm, the exporter applies for an Advance Authorisation on a self-declared basis, proposing these input-output ratios, and gives the required undertaking to abide by the eventual decision of the Norms Committee. The Regional Authority issues the Authorisation based on the self-declared norms, and the exporter imports the input, manufactures and exports the finished product.
Subsequently, the Norms Committee examines the declared norms and determines that Input A should be restricted to 1,050 kg instead of the 1,100 kg declared. The exporter therefore has an excess entitlement of 50 kg of Input A. Under Para 4.07(ii) of HBP, 2023, the exporter becomes liable to pay the applicable duty and interest as notified by DoR, and must make the payment within 30 days from the date the Norms Committee decision is hosted on the DGFT website.
Documents required
The application should generally be supported by information sufficient to establish the proposed input-output relationship, including and as applicable:
Applicant & application
- IEC and applicant details
- ANF-4A application for Advance Authorisation
Export product details
- Details of the export product, including appropriate description and classification
Input details
- Details of each proposed input, including quantity and classification
Manufacturing process
- Details of the manufacturing process
Consumption & production data
- Input consumption and production data supporting the proposed norms
Supporting manufacturer
- Details of the supporting manufacturer, where applicable for a merchant exporter
Undertaking
- The prescribed undertaking to abide by the Norms Committee's decision
Additional documents
- Any additional technical documents or certificates required by DGFT/RA for the product or manufacturing process
How self-declared Advance Authorisation works
Our engagement runs from checking the applicable norms route through to filing, Authorisation, and closure formalities.
Before you apply
Confirm the right routeCheck for an existing SION
First determine whether the export product is covered by an existing SION. If an applicable SION completely covers the required inputs and the export product, the normal SION route may be preferable.
Check for valid ad hoc norms
If no SION exists, check whether a valid applicant-specific/ad hoc norm is already available for use.
Ensure the reason for using self-declaration
Self-declaration can be considered where there is no SION/valid ad hoc norm, or where an existing SION/ad hoc norm exists but additional inputs are required to be used.
Check the ineligible import list
Confirm that the import item(s) are not included in the list of items mentioned in Para 4.11 of FTP, 2023.
Determine the proposed input-output ratio
Calculate the quantity of each input required for manufacture of the proposed export product. The proposed quantities should be based on a technically justifiable manufacturing process rather than for maximising the import entitlement.
Filing & Authorisation
ANF-4A and the undertakingFile the Advance Authorisation application
File the online application through the DGFT system using ANF-4A, providing the required details.
Submit the undertaking
The applicant must undertake to abide by the eventual decision of the Norms Committee.
RA issues the Authorisation
The Regional Authority may issue the Advance Authorisation based on the self-declared norms, without waiting for approval from the Norms Committee.
After Authorisation
Fulfilment and closureImport and fulfil the Export Obligation
The exporter imports the permitted inputs, manufactures and exports the finished goods in accordance with the applicable Advance Authorisation conditions.
Monitor the Norms Committee decision
The exporter should monitor the DGFT website for the subsequent Norms Committee decision relating to the applied self-declared norms.
Deal with revision/rejection, if any
If the Norms Committee revises or rejects the declared norms, the applicant must pay the applicable duty and interest within 30 days from hosting of the Committee's decision on the DGFT website.
Complete EODC/closure formalities
After fulfilment of the Export Obligation and compliance with the applicable conditions, the exporter can proceed with the prescribed Advance Authorisation closure/EODC process.
If you need an Advance Authorization for a product which has no SION/ad hoc norms and can't wait for full ad hoc norms review and its update, please book a free consultation with us.
- Eligibility & risk assessment — our DGFT team assesses whether self-declaration fits your requirement and risk profile.
- Appendix-4E documentation — we prepare an error-free online submission covering your input-output consumption data.
- Norms Committee tracking — we track the Norms Committee's ratification from submission of the application to its closure.
FAQs
Self-declared norms are applicant proposed input-output norms used for obtaining Advance Authorisation where there is no SION or valid ad hoc norm, or where an existing SION/ad hoc norm does not cover additional inputs required by the exporter.
No. If the existing SION or ad hoc norm fully covers all the inputs required, then the approach is to apply using that existing norm rather than making a self-declaration. Only if it is required to use additional inputs in the manufacturing process beyond those covered by the existing SION/ad hoc norms should Advance Authorisation under self-declared norms be opted.
No. The main advantage of opting for the Advance Authorization under Self-Declaration route is that the RA may issue the Authorisation on the basis of the applicant's self-declaration without waiting for approval from the Norms Committee for the norms fixation.
No. HBP, 2023 does not prescribe a specific number of days within which the Norms Committee must ratify the self-declared norms.
No. Not all products are eligible for Advance Authorization under Self-Declared Norms. Import items listed in Para 4.11 of FTP, 2023 are not eligible for Advance Authorization under self-declared norms.
No. The Norms Committee will review the applied input-output norms. The applicant must undertake to abide by the subsequent decision of the Norms Committee, in case different norms are approved.
The applicant must pay the applicable duty and interest on the resulting liability, as notified by DoR, within 30 days from the date the Norms Committee decision is hosted on the DGFT website.
No. The wastage quantity is already included in the declared norms applied. The Norms Committee may approve, revise or reject it as per their decision, which has to be complied with by the Authorization holder.
A Chartered Engineer certificate should not be treated as a mandatory requirement for every self-declared Authorisation. Product-specific or application-specific requirements should be checked for compliance.
No. In self-declaration the Advance Authorization is first issued by the RA and the Norms Committee subsequently provides its decision, the consequences of which have to be complied with. Under the Self-Ratification route eligible applicants can obtain the Authorization from the RA quickly, but are subjected to risk-based post-export verification and audits, within three years, to check actual consumption against the declarations.
No. Para 4.07 of HBP, 2023 expressly provides that the RA shall not issue an Authorisation for import items listed in Para 4.11 of FTP 2023.
The principal risk is subsequent revision or rejection by the Norms Committee. If the Committee permits a lower input quantity than declared, or rejects the norm, the applicable duty and interest liability must be paid within the prescribed period.
The self-declaration route does not itself create a specific ineligible condition on merchant exporters. Advance Authorisation may generally be issued to a manufacturer exporter or to a merchant exporter tied to a supporting manufacturer, subject to the applicable conditions of the scheme.
The requirement of three years' production history is not prescribed as a mandatory eligibility condition, but the required historical data must be furnished to the extent applicable and may affect repeat self-declared authorizations.
AEO certified exporters are eligible to apply for Advance Authorization under Self-Ratification, which offers a special benefit compared to the Self-Declaration route: the declared norms are treated as final, without the requirement of subsequent approval by the Norms Committee. The choice of an AEO exporter opting for the Self-Declaration route instead should be studied in detail against this benefit.
No. Choosing Self-Declared Norms under Para 4.07 of HBP 2023 does not, by itself, change the normal validity periods applicable to an Advance Authorization.
This is exactly a situation where the advice of an experienced consultant is required. The proposed export product and its inputs should be checked for an applicable SION or a prior existing ad hoc norm.
Official DGFT/CBIC source notifications
- Foreign Trade Policy (FTP) 2023, Chapter 4, Para 4.03(b)(ii) — Advance Authorization under self-declaration.
- Handbook of Procedures (HBP) 2023, Para 4.07 — self-declared norms, covering when the route is available, the undertaking requirement and the 30-day duty and interest liability in case of revision or rejection of the applied norms.
- Foreign Trade Policy (FTP) 2023, Para 4.11 — list of ineligible import items for Advance Authorization based on self-declaration.
- Handbook of Procedures (HBP) 2023, Appendix-4E — provides technical and consumption details needed to assess the input-output norms proposed by the applicant.
- DGFT official portal (dgft.gov.in) — ANF-4A prescribed application with filing instructions for Advance Authorization under self-declared norms.
