DGFT: Submission for review of Global Authorisation for Intra-Company Transfer (GAICT) scheme
Blog: NASSCOM Official Blog
On 10 March 2021, NASSCOM submitted a representation to DGFT, to submit suggestions received by the industry for review of the Global Authorisation for Intra-Company Transfer (GAICT) scheme. The representation refers to Public Notice 20 which notified the GAICT scheme and Public Notice 65 for implementation of GAICT. For background of GAICT scheme, Public Notice 20 and Public Notice 65, please see here.
The representation requests DGFT for the following in relation to the GAICT scheme:
- Clarification that GAICT covers re-export of SCOMET items which have already been imported at the time of applying for GAICT, and SCOMET items which may be imported by the exporter within the GAICT validity period.
- Include items/software/technology imported under bulk authorisations under the coverage of the GAICT scheme.
- Exclude the need for providing ‘Product model No./part No.’, ask for only ‘Generic Description of export item/s including technical specification’, and ask for only the first 3-digit alphanumeric SCOMET product codes under Table 2A (Details of SCOMET items), ANF 2 O(b). This is to ease the burden on the industry to re-apply for a new GAICT authorisation to keep in line with updates in the SCOMET list as a response to update in the WA control list. Moreover, it is impracticable for the industry to provide the product/part/model numbers of SCOMET items as these are dynamic in nature and often run into thousands.
- Ask for Technical drawings (Information on Product/Technology) and Technical Specifications/Data Sheets/Brochures of the product (s) only where applicable, under Table 8 (Type of supporting documents submitted to DGFT), ANF 2 O(b).
- Delete the requirement that the use of an item which is re-exported under GAICT shall not be changed, nor the item modified or replicated without the prior consent of the Government of India (under Appendix 2 S (iv)), as this is in contradiction to paragraph F of Public Notice 20 which states that further re-export/re-transfer of the item/software/technology from the foreign parent company or its subsidiary to end users in other countries would be subject to the export control regulations of the country of the foreign parent company or its subsidiary.
- Clarify that a time period of import and export is sufficient instead of the exact date of import and export, under Table 3(i) of ANF 2O (c). This is because it is difficult for the industry to specify the exact date and instances of re-export of certain technology/software, due to its intangible nature.
- Clarify as to how should the value of re-exported software/technology be specified by the industry, in the case of transfer of software/technology which is not in the final executable form, under Table 3(iii) of ANF 2O (c). This is because most often the intra-company transfers are being carried out by the industry to perform research and development services on an intermediate software, in which case it is not possible to attach a value to the software/technology being worked upon.
- Revise the scope of GAICT scheme to include repair and return services. This will reduce the burden on the industry to obtain an additional SCOMET license for re-export of items that were originally imported for the purposes of performing repair services.
- Revise the scope of a GAICT authorisation to include approved third-party entities which form part of the same supply chain. This will reduce the burden on the industry to obtain an additional SCOMET license for the Indian third-party company for transfer of technology to the same foreign company. Moreover, it will enable Indian companies to perform services for the Original Equipment Manufacturer (OEM) along with the foreign subsidiary seamlessly and integrate with the global supply/value chain.
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