AEO 2.0: Redefining Trade Facilitation in India

[DrJoshua Ebenezer]

The Indian government’s latest Customs (On-Arrival Movement for Storage and Clearance at Authorized Importer Premises) Regulations, 2025 is a significant breakthrough for Authorized Economic Operators (AEOs), particularly those under Tier II and Tier III status. This new regulation paves the way for faster, more efficient, and cost-effective clearance of imported goods, setting a new benchmark for global trade facilitation.

What Does This Mean for AEOs?

Under the new system, AEO Tier II and III operators can now move imported goods directly from ports to their designated premises for storage and clearance. This eliminates unnecessary delays at congested ports and enhances supply chain efficiency.

Benefits:

1. Goods can be directly transferred to an Authorized Importer Premises, avoiding storage delays at port terminals.
2. The process is automated, reducing manual interventions and unnecessary documentation.
3. Companies save on storage, demurrage, and handling charges at ports.
4. Businesses get greater control over inventory and logistics.
5. Only flagged consignments will require additional checks, allowing most AEO shipments to move seamlessly.

Who can avail this facility?

The regulation applies to importers who posses AEO Tier II or III status,

1. Are registered under AEO Tier II or III status.
2. Have a designated place demarcated within a licensed bonded warehouse under Sections 58 or 58A of the Customs Act, 1962.
3. Hold section 65 permissions for manufacturing within a bonded warehouse.
4. Import goods classified under CTH 8517-8548 (typically electronic components and telecom equipment).

The AEO importer declares intent to use this facility in the Bill of Entry. The Customs Automated System grants automated permission after verifying compliance. Goods are moved under bond to the importer’s premises, sealed with customs-secured tracking. Upon arrival, the Bond Officer verifies the goods (if required). Goods can be cleared for home consumption or moved into bonded storage for further use.

Why Is This a Boon for Indian Trade?

This regulation aligns India’s customs framework with international best practices by strengthening India’s position as a trade-friendly nation. Providing just-in-time (JIT) inventory advantages. Also, encouraging more companies to Join AEO Programs by Increasing trust between businesses and customs.

For importers handling high-value goods, this “Direct Release to Authorized Importer Premises” is a game-changer. Faster clearance, lower costs, and improved compliance make this a golden opportunity for AEO-certified businesses in India.  If you are an AEO Tier II or III operator, now is the time to leverage this regulation for competitive advantage. Are you ready to transform your import operations?