Even though AEO accreditation
gives lot of benefits to Importers and exporters, still many feel difficult to
get it because of its detailed procedures and complexity in filling the forms.
Now CBIC has simplified the procedures to MEME’s with two
annexures for AEO T1 & three annexures for AEO T2 only instead of usual
detailed forms.
Important Highlights :
1.
Threshold
of import or export declarations-Minimum 10 documents, with
at least 5 documents in half year period of the preceding FY
2. Duration of business activities-Minimum
2 FYs preceding the date of application
3. Legal Compliance – For
last 2 FY’s sufficient
4. Financial solvency - Financially
solvent during the 2 FYs preceding the date of application
Refer below circular with simplified application
annexures;
Circular No.
54/2020-Customs
F.No.D-20/DIC/NCTF(NTFAP)/29/2017
Government of India
Ministry of Finance
Department of Revenue
Central Board of
Indirect Taxation & Customs
Directorate of
International Customs
New Delhi, dated the
15 December, 2020
All Pr. Chief/Chief Commissioners of
Customs/Prev./Central Tax,
All Pr. Commissioners/Commissioners of
Customs/Prev./Central Tax,
All Pr. Directors General/Directors General under
CBIC,
All Pr. ADG/ADG under CBIC
Madam/Sir,
Subject: Special measures to facilitate
MSME for AEO T1 & T2 accreditation- reg.
Please refer to the CBEC Circular No. 33/2016 dated 22.07.2016 as
amended, hereinafter referred to as the "Master Circular" regarding
the Authorised Economic Operator (AEO) programme. Para 3.1.9 of the Master
Circular states that "In particular, the AEO Programme Manager
shall take into account the possible difficulties for MSMEs in meeting with
these eligibility conditions and criteria under paras 3.3 and 3.5 with a view
to make the above AEO certificates more available to MSMEs."
2. In line with the Prime Minister's Aatma
Nirbhar Bharat Abhiyaan to support MSMEs against the challenges of the COVID-19
pandemic, CBIC has examined the difficulties faced by MSMEs while applying for
AEO accreditation. Accordingly, the Board has decided to relax the entire gamut
of compliance and security requirements for MSMEs. The relaxation has been
carried out to ensure that the MSMEs are facilitated through rationalized
compliance requirements (MSME Annexure 1 & 2) and minimum but effective
security requirements (MSME Annexure 3).
3. Accordingly, the Board has decided to
facilitate MSMEs by further relaxing the current accreditation process and
reducing the compliance burden for their AEO accreditation. The procedural
modifications/relaxations for AEO accreditation of MSMEs are as under.
i. The eligibility requirement of
handling a minimum of 25 documents during the last financial year has been
relaxed to 10 documents, subject to handling at least 5 documents in each
half-year period of the preceding financial year (Ref.: Para 3.1.7 of the
Master Circular).
ii. The requirement for the
applicant to have "business activities for at least three financial years
preceding the date of application" has been relaxed to two financial
years. (Ref.: Para 3.1.6 of the Master Circular).
iii. The qualifying period for legal
and financial compliance has been reduced from 'the last three financial years'
to 'the last two financial years'. (Ref.: Paras 3.2 & 3.4 of the Master
Circular).
iv. For AEO T1 and T2
accreditation, the present annexures i.e., Annexure A, B, C, D, E. I-E.4 have
been supplanted with two annexures viz. MSME Annexure 1 and 2. Similar rationalized
annexures 1 and 2 are presently being utilized for AEO T1 accreditation only in
accordance with the CBIC Circular No. 26/2018-Customs dated 10.08.2018.
v. For AEO T2 certification, the
present annexures i.e., Annexure E.5.1-E.5.7 for physical verification have
been rationalized to a single annexure viz. MSME Annexure 3. The
rationalization has been carried out to ensure that the security requirements
for an MSME are objective and cover the minimum verifiable security criteria.
(Ref.: Para 3.5 of the Master Circular).
vi. The time limit for processing
of MSME AEO T1 & AEO T2 application has been reduced to fifteen working
days (presently one month) and three months (presently six months) respectively
after the submission of complete documents for priority processing by customs
zones.
vii. The benefit of relaxation in
furnishing of Bank Guarantee for AEOs has been further relaxed to 25% from 50%
and 10% from 25% of that required to be furnished by an importer/exporter who
is not an AEO certificate holder, for MSME AEO T1 and MSME AEO T2 entities
respectively (Ref.: Para 3.5 of the Master Circular).
4. The aforestated relaxations shall apply
only to an applicant who has a valid MSME certificate from the line-Ministry.
Further, the approved MSME must ensure their continuous MSME status during the
validity of its AEO certification, if granted.
5. Thus, the AEO accreditation for MSMEs now
requires submission of only two annexures for AEO T1 and three annexures for
AEO T2 applicants respectively. The two common annexures for AEO T1 and AEO T2
are: MSME Annexure 1 (General Compliance), MSME Annexure 2 (Legal, Managing
Commercial Records, and Financial Solvency Compliance). Further, the third
annexure for AEO T2 is MSME Annexure 3 (Safety and Security Requirements).
These annexures have been designed to fulfil the aspirations of simpler
application procedure with reduced documentation requirement for AEO
accreditation of MSMEs.
6. The Board Circular No. 33/2016- Customs
dated 22/7/2016 as amended stands modified to the above extent.
7. Wide publicity may please be given to this
Circular by way of issuance of Trade/Public Notice.
8. Difficulties faced, if any, in the
implementation of this Circular may be brought to the notice of this office.
Yours faithfully,
(Manish Kumar)
Joint Commissioner
(DIC)
Enclosure: As
above.
APPLICATION FORM FOR
GRANT OF AEO T1 & T2 STATUS (for MSMEs)
Note:- This form
shall apply only to an applicant who has a valid MSME certificate from the line
Ministry. Further, the approved MSME must ensure their continuous MSME status
during the validity of its AEO certification, if granted. In case of break or
revocation of the MSME status, the same shall be communicated to the Pr.
Commissioner, DIC within 30 days, failing which, the AEO status shall be
revoked and the entity shall be considered non-compliant on account of wilful
suppression of information for the next one year from the end of the validity
of its AEO certification.
MSME Annexure - 1
(General Compliance)
The applicant is required to provide information in
this prescribed format in terms of Para 3 (iv) of the Circular No. 54/2020
dated 15.12.2020.
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S.No.
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COMPLIANCE PARAMETER
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DETAILS
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1.
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Name of Company / Economic Operator:
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2.
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Has your AEO
application been rejected or your AEO status been suspended in past? If so,
on what grounds (please enclose the rejection/suspension letter):
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3(a).
3(b).
3(c).
3(d).
3(e).
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IEC No.:
GSTIN:
MSME Certificate No.:
Company Registration No. (If
applicable):
PAN:
(Copy of the above documents to be
provided)
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4.
4(i).
4(ii).
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Address:
Number and Street:
Zip Code and City:
(This shall include list of sites, under control, where import /
export goods are handled, e.g. packed / unpacked / loaded / unloaded /
consolidated etc. in the course of supply to/from international supply chain)
Please provide Site Plan for all the above sites.
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5(a).
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Whether applicant is a manufacturer
or trader
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5(b).
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If applicant is a manufacturer, what
are the main items of manufacturing?
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5(c).
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The industry sector to which the
applicant belongs
(Eg. Auto/ Pharma/ Chemicals & Plastics/
IT/Metals/ Electronics Goods et al.)
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6(a).
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Contact person.*
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6(b).
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Designation:
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6(c).
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Contact Number:
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6(d).
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Email address:
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7(a).
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Major Items of import and countries
(in case of importer):
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7(b).
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Major Items of export and countries
(in case of exporter):
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8.
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No. of documents i.e. Bills of Entry
or Shipping Bills filed during last financial year
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9.
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Duration for which the entity has
business activities preceding the date of application (in months):
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10.
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Provide Process Map that should
illustrate the flow of goods and provide sample copy of relevant record
keeping documentation (related to- sales & purchase orders, inventory
management of warehouse and manufactured goods, shipping/transport document)
to ascertain the complete trail and flow of goods. It should describe all the
activities/ operations and role of the applicant and that of other business
partners who are involved in the import-export supply chain in any manner.
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MSME Annexure - 2
(Legal, Managing Commercial Records. and Financial Solvency Compliance)
The applicant is required to provide information in
this prescribed format in terms of Para 3 (iv) of the Circular No. 54/2020
dated 15.12.2020.
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S. No.
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COMPLIANCE PARAMETER
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YES / NO
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REMARK
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1.
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Whether there are
any cases of infringement of Customs Laws by any of the following persons
over the two financial years preceding the submission of the application:
(i) the applicant;
(ii) the person responsible in the
applicant company for customs matters.
If yes, please indicate the details
of the cases.
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2.
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Have you been
issued an SCN by Customs or GST (erstwhile Central Excise and Service Tax)
authorities in last two financial years? If yes, kindly bring out:
1. Brief of the breach including the
provision invoked in the SCN.
2. Whether SCN has been adjudicated?
If Yes, bring out the decision of the order.
3. Whether there is
any case against you wherein prosecution has been launched?
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3.
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Provide the
break-up of contingent liability of last two financial years. If any
contingent liability pertains to Customs or GST(erstwhile Central Excise and
Service Tax) provide the brief of such liability
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4(i).
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Provide procedures
for administering of licence, authorizations connected to exports/imports
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4 (ii).
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Provide procedures for administering
the commercial records connected to exports/imports
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4 (iii).
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Do you deal in goods subject to
Anti-dumping duties, Safeguard duties or Countervailing duties? If yes,
please provide details of the goods
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5.
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Provide procedures
for verifying the accuracy of Customs declarations including procedure in
place for the establishment of Customs Value and tariff classification.
In case any
Business Partner/representative is involved in the above mentioned
process/formalities, please provide details of the representative along with
the document that brings out the responsibility of such representative
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6.
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Provide in brief
the procedure to ensure the protection of your computerized record system
from unauthorized access
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7.
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Provide procedures
for backup, recovery, archiving, and retrieval of your business record:
Please state for
how long this data is achieved.
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8.
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Provide the
Net-worth along with the audited Audit Report of your company for last two
financial years
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9.
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Provide the Net
Current Assets for your company for the last two financial years. If it is
negative, bring out the reason for the same:
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10.
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Provide details of
any insolvency, bankruptcy or liquidation proceedings taken against your
company in last two financial years. Please give a declaration in this regard
duly signed by CFO or head of Finance department:
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Note: The applicant
should enclose appropriate documentary evidence in support of the above claims.
MSME Annexure - 3 (Safety and Security Requirements)
(applicable for MSMEs applying for AEO T2 only)
The applicant is
required to provide information in this prescribed format in terms of Para 3
(v) of the Circular No. 54/2020 dated 15.12.2020.
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S. No.
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PREMISES SECURITY
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YES/NO
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REMARK
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1
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Whether the
building/premisesis fully secured against unlawful entry i.e. -
(i) Adequate fencing, lighting, and
security of the perimeter is maintained.
(ii) Adequate procedure for issuance
of lock & key by an authorized personnel is available.
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2
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Whether adequate
procedures exist to check that only properly identified and authorized
persons, vehicles and goods are permitted access?
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3
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Whether there are appropriate
security systems for
(i) access control
(both into and within the premises).
(ii) monitoring the
movements/ processes within the premises.
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S.No.
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CARGO SECURITY
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YES / NO
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REMARK
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1
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Whether goods are uniformly marked or
stored in designated areas only and its integrity maintained by -
(i) restricting access to only properly identified and authorized
persons.
(ii) permanent monitoring and keeping in a safe, locked area. (iii)
adequate monitoring and documentation of movement of car o within the
premises.
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2
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Whether all consignments
are secured by the use of any high security seals/e-seals and whether such
seals are being maintained, distributed and checked by an authorized
personnel of the company and verifiable record of the same is
being maintained?
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3
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Whether appropriate procedures exist
to
(i) weigh / tally the goods and
compare them against transport documents, purchase/ sales orders and Customs
papers.
(ii) deal with situations when any
discrepancies and/or irre ularities are discovered.
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S.No.
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CONVEYANCE SECURITY
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YES / NO
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REMARK
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1.
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Whether, to the extent possible, all
conveyances used for the transportation of cargo within the supply chain are
(i) capable of being effectively
secured.
(ii) driven by drivers having proper
identification and training
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2
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Whether the
seven-point inspection process is carried out in respect of containers before
stuffing of cargo therein. Also, whether potential places of concealment of
illegal goods on conveyances are regularly inspected. (preferably under
camera or verifiable record of the same is maintained) ?
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3
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Whether the transporters -
(i) maintain
training record with respect to drivers employed.
(ii) maintain the
conveyance integrity while it is en-route transporting cargo (by utilizing a
tracking and monitoring device or activity log/records
(iii) notify - any
route delays / rerouting or any suspicious incident to the designated
department of the applicant company as well as to maintain records of these
reports
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S. No.
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PERSONNEL SECURITY
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YES / NO
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REMARK
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1.
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Whether all reasonable precautions
are taken and background verification is done while recruiting new staff to
verify that they are not previously convicted of security-related, Customs or
other criminal offences?
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2
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Whether adequate procedures are in
place -
(i) for employee identification that
require all employees to carry proper identification that uniquely identifies
the employee and organization.
(ii) to identify, record and deal
with unauthorized or unidentified persons.
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3
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Whether procedures are in place to
expeditiously remove identification and access to premises and information
for employees whose employment is terminated?
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S. No.
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BUSINESS PARTNER SECURITY
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YES / NO
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REMARK
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1.
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Whether the applicant has an adequate
vendor/business partner selection policy ?
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2
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Whether the applicant has documented
proof of scope of services being rendered by the vendor/business partner,
incorporating as to whether they meet relevant AEO equivalent security
criteria?
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3
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Whether a system is in place for
periodic review/appraisal of business partner's processes and facilities
(based on risk assessment for maintenance of security standards by the
business partners ?
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S. No.
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SECURITY TRAINING AND THREAT
AWARENESS
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YES / NO
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REMARK
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Whether the
applicant has established and maintained
(i) a threat
awareness program to foster awareness of any threat at any point in the
supply chain.
(ii) adequate training programs for
relevant employees with respect various aspects of security (such as premises
security, cargo security, conveyance security and personnel security.
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2
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Whether employees
of the applicant are aware of the procedures in place to address any
situation with respect to any breach in supply chain and to report/escalate
the same?
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3
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Whether the records
of security training are maintained and are available for verification by the
AEO Programme team and Indian Customs?
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Note: The applicant should enclose
appropriate documentary evidence in support of the above claims.
