Foreign Trade Policy 2015-2020 – All you need to know about
Foreign Trade Policy 2015-2020, The Foreign Trade Policy 2015-2020 which was released on 1st April 2015 has begun a new Chapter in the Indian Foreign Trade policy regime, with substantial developments over the erstwhile policy and renewed objectives which are in line with India’s ambitions to achieve new frontiers in Global Trade by 2020. Now you can check more details from below..
History of Foreign Trade Policy
- Export – Import Policy 1992-1997
- Export – Import Policy 1997-2002
- Export – Import Policy 2002 -2007
- Export – Import Policy 2003-2004
- Export – Import Policy 2004-2009
- Foreign Trade Policy 2009-2014
- Foreign Trade Policy 2015-2020
Foreign Trade Policy 2015-2020
The Foreign Trade Policy 2015-2020 is governed by The Foreign Trade (Development and Regulation) Act, 1992.(Hereinafter Referred As ‘FTDRA, 1992’)
The policy is a reflection of gradual shift from incentive based to a reward based one.
In Foreign Trade Policy 2015-2020 following are the two immense schemes introduced for exports of Merchandise and services respectively:
Service Export From India Scheme
Under, Service Export From India Scheme(SEIS), vide Public Notice 3/2015 – 20, DT.1st April 2015, Government of India has notified various eligible Services, rates & conditions for rewards under the scheme.
As per Appendix 3D of Foreign Trade Policy 2015 – 20, exporter of Legal Services(Mentioned in S.no 1(A)(a)) (CPC code:861) are entitled to get the reward of 5% of Net Foreign Exchange Earnings*.
*Net Foreign Exchange Earnings = Gross Earnings of Foreign Exchange – Total Expenses/ Payment/Remittances of Foreign Exchange by the IEC holder, relating to service sector in the Financial Year
Legal Service Definition (CPC 861)
Description of legal Service has been defined in UNPC(United Nations Central Product Clarification) which includes Legal Advisory and representation Services and is as follows:
86111 – Legal Advisory and Representation Services Concerning Criminal Law
- Legal advisory and representation services during the litigation Process, & Drafting services of Legal Documentation in relation to criminal Law.
- Acting as a Prosecutor in case of Criminal offence when private legal Practitioners are hired on fee basis by the Government.
- Research Work for the preparation of a criminal case (e.g. Researching Legal Documentation, Interviewing Witnesses, Reviewing Police and other Reports).
- Execution of Post Litigation work in relation to Criminal Law.
86119 – Legal advisory and representation services in judicial procedures concerning other fields of law
- Legal advisory and representation services during the litigation Process, & Drafting services of Legal Documentation in relation to Law other than criminal Law.
- Representation Services generally consist of either acting as a prosecutor on behalf of the client or defending the client from a Prosecution.
- Research and other work for Preparation of a case (e.g. Researching Legal Documentation, Interviewing Witnesses, Reviewing Police and other Reports)
- Execution of Post Litigation Work, in relation to Law other than Criminal Law
86120 – Legal advisory and representation services in statutory procedures of quasi-judicial tribunals, boards, etc. :-
- Legal advisory and representation services during the litigation Process, & Drafting services of Legal Documentation in relation to Statutory Procedures.
- To be the Representative of Client in front of a Statutory Body (e.g. an Administrative Tribunal)
- Research and other work for Preparation of a case (e.g. Researching Legal Documentation, Interviewing Witnesses, Reviewing Reports)
- Execution of Post Litigation Work
86130 – Legal Documentation and Certification Services :-
- Preparation, Drawing up and Certification Services of Legal Documents.
- Drawing up of Will, Marriage Contracts, Commercial Contracts, Business Charters Etc.
86190 – Other Legal Advisory and Information Services :-
- Advisory Services to Clients related to their Legal rights & obligations.
- Providing Information on Legal Matters.
- E.g.à Escrow Services, Estate Settlement Services.
Definition of ‘Service’ & ‘Service Provider’ Under Foreign Trade Policy
Effective Date of Scheme
The Rewards under MEIS/SEIS shall be admissible for exports made/services rendered on or after the date of notification of this policy.
Last Date of Filing of Application for Duty Scrips
For SEIS, the last date for filing application shall be 12 month from the end of relevant Financial year of claim period.
Ineligible Categories Under SEIS
1.Foreign Exchange Remittances other than those earned for rendering of notified Services would not be counted for Entitlement.
2.Following Shall not be taken into Account for calculation of Entitlement Under the Scheme
- a) Foreign Exchange Remittance
- b) Payments for services received from EEFC Account;
- c) Foreign exchange turnover by Healthcare Institutions like equity participation, donations etc.
- d) Foreign exchange turnover by Educational Institutions like equity participation, donations etc.
- e) Export turnover relating to services of units operating under SEZ / EOU / EHTP / STPI / BTP Schemes or supplies of services made to such units;
- f) Clubbing of turnover of services rendered by SEZ / EOU /EHTP / STPI / BTP units with turnover of DTA Service Providers;
- g) Exports of Goods.
Procedure to be Followed for Claiming Benefit Under SEIS in FTP 2015-20
- Basic Details of Applicant – Name, IEC Details, Address, Telephone No., E-Mail etc.
- Registration Cum Membership Certificate
- Category of Service As per Relevant Notification
- Net Foreign Exchange Earned for Rendering Services From India to outside India or in India :-
a)Supply of ‘Service’ form India any other Territory
b)Supply of ‘Service’ from India to Service Consumer(s) of any other country.
c)Supply of a ‘service’ from India through commercial presence in any other country
d) Supply of a ‘service’ from India through the presence of natural persons in any other country
e) Foreign Currency Payments under above respective
Points To Ponder
Advances received in the form of Client Deposits not to be taken into consideration for calculation of Export Turnover under FTP provisions.
Registration Cum Membership Certificate (RCMC) – There is a particular column in the prescribed application form to be filled for claiming the benefit. As per our understanding it’s to be applied by Manufacturer Exporter / Merchant Exporter for taking membership under respective trade council. Implications of the RCMC is to be ascertained.
Directorate General Foreign Trade (DGFT) Headquarter randomly select 10% of cases through computer system for each Regional Authority (RA) where scrips have already been issued, under each scheme.
Documents to be maintained for the period of three years from the issuance of scrips as Regional Authority may ask for original proof of landing certificate, annexures attached to the application form or any other document.
Non-Realisation of export proceeds in time limits prescribed by RBI.