CBIC Rolls Out Automated Out of Charge (OOC) for AEO -Tier 2 and AE0 -Tier 3

[YAGAY andSUN]

The Central Board of Indirect Taxes and Customs (CBIC) in India has introduced the Automated Out of Charge (OOC) facility for Authorized Economic Operators (AEO) T2 and T3 Status Holders. This move aims to enhance efficiency and streamline the customs clearance process, offering several benefits for businesses involved in international trade.

What is the "Automated Out of Charge" (OOC)?

The Out of Charge (OOC) is a crucial customs procedure in India, signalling that goods have been cleared by customs for onward movement. It marks the end of the customs clearance process, allowing the goods to be released for importers or exporters to complete their transaction.

With the new Automated OOC facility, customs will now automatically issue the OOC for goods belonging to AEO T2 and T3 clients once the required compliance checks have been successfully completed. These checks ensure that the goods meet the necessary import/export regulations, but instead of a manual clearance process, it will now be handled automatically.

For details, kindly refer CBIC Circular No. 01/2025-Customs w.e.f. 01-01-2025

Key Features of Automated OOC for AEO-T2 and T3 Clients:

1. Automation:
   • The process of issuing an OOC will now be automated, reducing the need for manual intervention. This significantly speeds up the process and minimizes human error.
2. Eligibility for AEO-T2 and T3:
   • The automated OOC is available for clients who hold AEO-T2 (Intermediate) and AEO-T3 (Authorized Economic Operator - Self-Assessment) status. These are higher levels of AEO certification that reflect the trust and reliability of the business in the eyes of customs authorities.
3. Faster Clearance:
   • For AEO clients, the new system will significantly reduce the clearance time, allowing goods to be cleared and released more quickly than in the past, improving the overall supply chain efficiency.
4. Reduced Paperwork and Compliance Burden:
   • The automated system minimizes the paperwork involved in the customs clearance process. AEO clients can enjoy a smoother, faster, and more streamlined procedure with less administrative burden.
5. Enhanced Trade Facilitation:
   • By offering a faster and more predictable clearance process, the automated OOC will boost trade facilitation, enabling businesses to deliver goods on time and adhere to global trade standards more effectively.
6. Trust-based System:
   • AEO-T2 and T3 clients are deemed trustworthy by the CBIC, having undergone thorough audits and checks to meet high compliance standards. The system relies on this trust, making it easier for these businesses to navigate customs procedures with less friction.

7. Transparency:
   • The automated system ensures transparency in the customs clearance process, as businesses will receive real-time notifications and updates regarding the status of their OOC, reducing delays or confusion.

Benefits to Businesses:

• Speed and Efficiency: The reduction in processing time for customs clearance helps businesses save on time and operational costs.
• Lower Risk of Delays: With automation, the chances of human error are significantly reduced, leading to fewer delays in the clearance process.
• Cost Savings: Faster processing means that businesses can reduce holding costs, warehousing fees, and other logistics-related expenses.
• Better Compliance: Since AEO clients are required to maintain high standards of compliance, the automated OOC process ensures that businesses can continue to demonstrate their compliance efficiently.

Impact on AEO-T2 and T3 Certification:

• Incentives for Certification: The move encourages more businesses to seek AEO certification to avail themselves of the benefits of the automated system. As the Indian government continues to promote AEO, the benefits of such certifications will grow, including faster customs processing and fewer compliance-related delays.
• Stronger Trade Relationships: For international businesses, working with Indian AEO-certified entities will ensure smoother cross-border transactions due to the streamlined clearance process.

Conclusion:  The introduction of Automated Out of Charge for AEO-T2 and T3 clients by the CBIC is a significant step toward modernizing and streamlining India's customs procedures. By automating the OOC process, India is offering a faster, more efficient, and cost-effective way to handle customs clearance for trusted businesses, thereby strengthening its position in global trade. It also incentivizes businesses to adopt best practices in compliance and engage in more secure, reliable trading relationships.