Export Promotion Capital Goods (EPCG) scheme allows import of capital goods including spares for pre production, production and post production at zero duty for specified sectors and at a concessional rate of 3% Customs duty for all sectors, subject to an export obligation ranging from 6 to 8 times of duty saved on capital goods imported under EPCG scheme, to be fulfilled in 6 to 8 years reckoned from Authorization issue-date. EPCG scheme covers manufacturer exporters with or without supporting
manufacturer(s)/ vendor(s), merchant exporters tied to supporting manufacturer(s) and service providers. The Scheme also covers a service provider who is designated / certified as a Common Service Provider (CSP). EPCG authorization holder can export either directly or through third party (s). Export proceeds are to be realized in freely convertible currency except for deemed exports. Import of capital goods imported under the EPCG scheme shall be subject to Actual User condition till export obligation is completed. Export Obligation under EPCG scheme is required to be fulfilled by export of goods manufactured/services rendered by the applicant. Export obligation under the scheme is over and above, the average level of exports achieved by the authorization holder in the preceding three licensing years for the same and similar products within the overall export obligation period including extended period, if any. Such average would be the arithmetic mean of export performance in the last three years for the same and similar products. The Authorization holder under the EPCG scheme shall fulfill a minimum of 50% export obligation in each block of years as may be specified. Upto 50% Export Obligation is permitted to be fulfilled by exports of other good(s) manufactured or service(s) provided by the same firm / company, or group company / managed hotel, which has the EPCG authorization. Royalty payments received in freely convertible currency and foreign exchange...
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