DGEP's clarification and directive on setting up of duty free shops
FIPB considers the proposals of foreign direct investment for setting up of duty free shops at airport/ports by evaluating the technicalities involved therein (i.e. if it includes technical collaboration/industrial license apart from foreign investment) and also keeping in view sectoral policies and requirements vis-a-vis the proposal(s).
It is clarified that the recommendation of FIPB with regard to these proposals is only for foreign financial and technical collaboration and it does not automatically confer any right on the applicants to set up shops at any port. The foreign investors will have to obtain other prescribed clearances separately in accordance with the guidelines issued by the Department of Industrial Policy and Promotion, Secretariat of Industrial Assistance (FC Division) under the Press Note No. 3 (1997 series) dated 07.01.1997.
In this backdrop, the jurisdictional Commissioners of Customs/Central Excise are directed to adhere and scrupulously follow the conditions, restrictions and the statutory requirements under the Customs Act, 1962 before granting licenses for setting up of duty free shops even in cases where FIPB has approved the proposal. The directive highlights CBEC's instructions, conditions and guidelines for setting up of private bonded warehouse from time-to-time, notably Circulars Nos. 68/95 dated 15.6.95, 99/95 dated 20.9.95, 28/96-Cus dated 14.5.96 and 18/2007-Cus dated 24.04.2007.
DGEP CIRCULAR NO. , Dated: November 14, 2008