To
All Members
Council for Leather Exports

Dear Member,

Sub: DGFT Public Notice No: 8/2010 Amending the Bank Guarantee and LUT Formats for the DEPB and other Incentive Schemes

The Directorate General of Foreign Trade vide the subject Public Notice No: 8/ (RE: 2010)/2009-2014 of September 6 2010 has amended the format of the Bank Guarantee and LUT respectively for the DEPB Scheme and other Freely Transferable Incentive Schemes as the FPS, FMS & MLFPS as notified in Appendix 25C and Appendix 25D to the Foreign Trade Policy. The changes vide this amendment are as follows:

1. Sl. No. 3 under the ‘Note’ to Appendix 25 C related to “BG Format” which stated “The Bank Guarantee shall be valid till the expiry of the time period of 24 months from the date of export (Let Export Order Date). In case of a number of S/Bs filed against one application under DEPB Scheme / Incentive Scheme, 24 months time period shall be from the LEO date of latest S/B.” now has an additional condition ie “In case of Revolving BG, the BG shall remain valid till all the obligations of the party are fulfilled to the ‘Full’ and ‘Final’ satisfaction of the Govt. as per policy and till such written consent is communicated to the party or the Guarantor, as the case may be.”

2. Sl. No. 4 under the ‘Note’ to Appendix 25 D related to “LUT Format” which had stated that “The LUT shall be valid for a time period of 24 months from the date of export (Let Export Order Date). In case of a number of S/Bs filed against one application either for DEPB or for any specific freely transferable Incentive Schemes under Chapter 3 of FTP, 24 months time period shall be from the LEO date of latest S/B”, now has an additional condition i.e. “In case of Revolving LUT, the LUT shall remain valid till all the obligations of the party are fulfilled to the ‘Full’ and ‘Final’ satisfaction of the Govt. as per policy and till such written consent is communicated to the party.”

3. Sl. No. 9 under the “Guidance in the matter of Executing BG / LUT” mentioned after Appendix 25 D which had stated “Applicant shall have the option to file BG/ LUT against each application or a Revolving BG / LUT. The revolving BG/LUT shall be limited to a specific scheme, which means that for an exporter/party filing application for different schemes under the aforesaid laid down guidelines, shall be required to file separate BG/LUT for each scheme. BG/LUT filed in one RA shall not be utilized for BG/LUT to be filed in another RA for different application”, now has an additional condition ie “The revolving BG / LUT shall remain valid till all the obligations of the party are fulfilled to the ‘Full’ and ‘Final’ satisfaction of the Govt. as per policy and till such written consent is communicated to the party or the Guarantor, as the case may be.”

A copy of the subject Public Notice No: 8/2010 is attached for ready reference of members.

Members may kindly take note.

Regards,

Ali Ahmed Khan
Executive Director