Subject: Implementing Electronic Sealing for Containers by exporters under self-sealing procedure prescribed by circular 26/2017-Cus dated 1st July 2017, circular 36/2017 dated 28.8.2017 and 37/2017 dated 20.9.2017 – reg - Customs - 38 /2017

OFFICE OF THE COMMISSIONER OF CUSTOMS NEW CUSTOMS HOUSE, PANAMBUR, MANGALURU 575 010 Tel: 0824-2408164 Fax: 0824-2407100 E-mail:[email protected] C.No. S-26/04/2016 Cus Tech Date: 02.11.2017 PUBLIC NOTICE NO. 38 /2017 Subject: Implementing Electronic Sealing for Containers by exporters under self-sealing procedure prescribed by circular 26/2017-Cus dated 1st July 2017, circular 36/2017 dated 28.8.2017 and 37/2017 dated 20.9.2017 reg Attention of the Importers, Exporters, Customs Brokers and the members of Trade is invited to the Board s Circular No. 41/2017 - Cus dated 30.10.2017, on the above subject. With the introduction of self-sealing using RFID e-seals, the Board has sought to enhance export facilitation by dispensing the need for exporters seeking the presence of jurisdictional officer for the purposes of supervising stuffing of the cargo at approved premises. This measure is expected to reduce transaction costs of exporters since they do not have to incur MoT charges in respect of such supervision as well as improve their timeliness of their exports. Such facilitation is proposed to be backed by application of technology in the form of exporters using RFID e-seals since it has the potential to improve visibility and enhance cargo security during transportation to Ports ICDs as well as during holding time. 2. Attention is drawn to para 5 of circular 37/2017-Customs dated 20th September 2017, stating the date for mandatory e-sealing shall be 1st November 2017. In order to take stock of the preparedness of the trade, field formations, the Board has held consultations with the vendors. Trade associations and field formations have queried about the procedures to be followed for export of goods under RFID self-sealing prescribed under the above circulars. The following clarifications are provided for the sake of uniformity and better understanding of the new procedure. 3. Circulars 26/2017 and 36/2017 have obligated following classes of exporters to adopt RFID e-sealing: (a) exporters already enjoying the facility of self-sealing after having been approved by jurisdictional formations under the erstwhile procedures; (b) exporters who have hitherto been availing of supervised sealing and have been automatically entitled to avail of self-sealing using RFID e-seals, without having to expressly seek any permission/approval of the jurisdictional commissioner for this purpose; (c) AEOs, regardless of whether they were self-sealing or undertaking supervised sealing, have also been entitled to avail of the new procedure; (d) Lastly, all exporters have been extended this facility subject to their filing GST returns but after seeking permission for self-sealing from the jurisdictional Commissioner as per procedure prescribed under para 9(iii) of circular 26/2017-Cus dated 1st July 2017. 4. The procedure prescribed under the above circulars applies only to cargo in full container load, sealed at an approved premise, by an entitled exporter. In case of an FCL being received at a Port or ICD under self-sealing using RFID e-seals, prescribed under circular 36/2017- Customs dated 28th August 2017, it shall be deemed to be equivalent to a container sealed under the erstwhile system of officer supervised sealing. Unless and until there are good reasons or intelligence to warrant inspection of such containers, there shall be no need for examination of such containers once the RFID e seal is read as intact or not tampered. 4.1 In case an RFID seal affixed on a self-sealed container is found tampered, the same shall be subject to examination as already prescribed under para 2(f) of Circular 36/2017- Cus dated 28th August 2017. However, after examination, the further movement of such a container shall not be under the RFID e-seal procedure. The existing system of using the traditional bottle seals by customs shall continue for such movements. 4.2 Full containers brought to Ports without RFID e-seals shall be taken to a CFS or allowed direct port entry, as the case may be, and will be subject to usual RMS treatment. Similarly, Full Containers Loads arriving at ICDs, but without RFID e-seals, will be subject to usual risk management parameters. 4.3 The procedure under the subject circulars does not apply to export of noncontainerized cargo or Air cargo or for movement of cargo from CFSs to ICDs/Ports or cargo exported through Land Customs Stations. Extant practices in respect of such cargo shall continue. 5. The issue of the type of readers that vendor shall provide to customs has also been raised. The Board has permitted vendors to either provide fixed readers, in consultation with custodians at Ports and ICDs, or provide handheld Readers. 5.1 It is also re-iterated that data once uploaded by the exporter should not be capable of edited or deleted. 5.2 The web application shall capture the location where the RFID e-seal is read. 5.3 The vendors shall transmit the IEC details of such exporters who have purchased the RFID e-seals to RMD on a daily basis. The IEC number and the name of exporter shall be provided only when the vendor makes the first sale to the exporter; there is no need transmit the details of the exporter each time a sale is made. 5.4 The vendors shall make all efforts to serve the requirements of maximum number of exporters by providing the RFID e-seals. They shall also provide Readers to all the customs stations from where the client exporters are exporting their cargo. The department reserves its right to direct vendors to provide Readers at any particular port/ICD. 6. The list of stations where Readers have been provided by Vendors is annexed to this circular. As and when coverage is extended by vendors to more customs stations, they shall be included in the list of Ports / ICDs where e-sealing would be mandatory. For the benefit of the trade, Board shall update the list of Customs stations from time to time. 7. While the progress made in the coverage of reader network across ports and ICDs is well recognized, but factoring that it may take some time for the field formations to fully set up systems and procedures for handling RFID e-sealed containers as well as receipt of data, the Board has decided that mandatory e-sealing for different classes of exporters shall be brought in a phased manner as indicated below: 7.1 In respect of all exporters who have been permitted self-sealing facilities under erstwhile procedures and exporters who are AEOs, it would be mandatory to seal their export containers with prescribed RFID e-seal w.e.f 8th Nov. 2017. Any non-compliance will subject the containers to usual RMS parameters. 7.2 In respect of the category of exporters who are availing supervised stuffing at their premises, extant practice of supervised stuffing may continue till 19th November 2017. With effect from 20th November 2017, they shall have to switch to RFID e-sealing procedures. 7.3 Regarding the exporters who have newly applied to the jurisdictional customs authority for self-sealing permission under circular 26/2017-Cus dated 1st July 2017, they shall commence use of the facility subject to grant of permission and upon adoption of RFID e-sealing. 8. The applicable date for RFID e-sealing implies that exporters are required to use this procedure from the prescribed date. Any container sealed at the exporters premises before the prescribed date, shall not be required to be brought with RFID e-seal. 8.1 It is also clarified that those exporters who are in possession of RFID e-seals are at liberty to commence availing the facilitative procedures forthwith. It may be recalled that vide circular 37/2017-Cus, the e-sealing procedure had been made voluntary subject to availability of reader facilities. 9. The procedures in respect of customs stations where readers have not been provided by any vendor so far shall continue till 31st December 2017, as per existing practice. Board shall take necessary steps to make sure that the readers are made available at such customs stations by 1st January 2018. 10. Difficulties, if any, should be brought to the notice of this office. ( Dr. M. Subramanyam ) COMMISSIONER