Direct Port Delivery Scheme for Importers

Direct Port Delivery Scheme for Importers

Direct Port Delivery Scheme for Importers

On 5th September 2019, the Central Board of Indirect Taxes and Customs (CBIC) released a circular regarding the eligibility criteria for availing Direct Port Delivery (DPD) Scheme by Importers.

Outline

The Government of India (GoI) introduced Direct Port Delivery system for importers to avail the option of taking delivery directly from the port, rather than the CFS process. DPD system was first introduced in Jawaharlal Nehru Port (JNPT) for all the registered members associated with Custom’s Accredited Client Program (ACP).

It was implemented to minimise the delivery time, regularise the process of storing containers at ports and reduce logistics cost of the containers. This helps to create more space for consignments if the manufacturer requires necessary or additional storage space.

The DPD system operates in two types of modes, they are:

DPDDPD – The importer takes delivery from the port with own transport

DPD/CFS – The importer chooses the CFS process for delivery

This announcement seeks to extend its operation to all the ports in India by streamlining general guidelines, eligibility criteria and mode of operation. Since this process offers prolonged minimal cost for operation, CBIC recommends all the importers to register with

Objectives of DPD

  • To decrease the time for allocating and re-allocating the shipping consignments
  • Play a vital role to have a minimal rate for the operations
  • Simplify the rules, regulations and eligibility criteria for ease of doing business
  • Encourage SMEs, MSMEs and shipping industries to actively participate with DPD system
  • Increase the infrastructure of the ports to store more consignments
  • Support Accredited Client Program to increase voluntary compliance among the importers

Click here for SME, MSME or Trademark registration

Eligibility Criteria for Direct Port Delivery Scheme by Importers

Avoiding Clearance through Container Freight Stations (CFS)

One of the important initiatives by CBIC is taking necessary measures to avoid routing the clearance through CFS. This initiative has reduced time and proved cost-effective for all the importers. It was first launched at JNPT and soon will be implemented to other ports.

Since CBIC adopts DPD process, the consignments would be transferred by the internal team rather than members from the shipping company. This allows the containers to be properly sealed, labelled for identification and sorted and stored for allocation when the quantity is less than full.

Regulating guidelines

CBIC has regulated the guidelines to increase the mode of operation at all ports in India. The regulated guidelines will methodise the eligibility criteria, which will in turn increase registered importers and simplify the process of business.

Factors for availing DPD Scheme

Other than the benefits of time management and cost-effective process, importers choose to avail DPD for the following reasons:

  • Non-receipt of original documents from foreign countries
  • Consistent delay in delivering the order
  • Financial and credit constraints
  • Delay in settlement of debt of shipping lines
  • Choosing PD account with the terminals

Click here o read about Prohibited Items for Import in India

Guidelines for DPD

Eligible criteria for availing DPD

  • The importers should have registered as AEO Tier I, II or III status

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  • The importers should have a clear track record
  • The import volume should be 25 Full Container Load (FCL), Twenty-Foot Equivalent Unit (TEUs) in the present or previous financial year
  • All information should be furnished under Annexure-A

Importers who are not Eligible to Avail DPD

Importers who have a track record or case of the following in the last five years:

  • Mis-declaration of account of goods
  • Harbouring
  • Diverting the imported goods without informing the official department

Importers recorded with on-going prosecution proceedings under Section Customs Act, 1962

Imported goods are subjected to 100% examination related to the current terms and policies

Importing the goods by LCL consignments

Click here to know about Import and Export Code

Rules for availing DPD

The following are the conditions to be followed by the importer who chooses to avail DPD scheme

  • The importers should open a PD account with the terminals
  • The transport should be arranged by the shipping company for transporting the goods from the port to the industrial or manufacturing site
  • Should follow all the norms as stipulated by CBIC

Applying for DPD

The following are the procedures should be followed by the importers while availing DPD

Step 1: The importer should intimate the Shipping line 48 hours in advance before the arrival of the vessel

Direct-Port-Delivery-Scheme-for-Importers-2

Step 2: The mode of DPD such as DPDDPD or DPD/CFS should be informed while registering with the Shipping line

Step 3: File advance B/E and procure OOC from the DPD cell to exit the port gate

Step 4: The importer can inform in advance through mail or by DPD portal for importers

Direct-Port-Delivery-Scheme-for-Importers-3

Step 5: After providing the required information, the importer can download the IAL document from the DPD Portal

Step 6: Verify the status of DPDDPD or DPD/CFS

Click here to read about the circular

Documents Required to Apply for DPD if the Importer is not registered with DPD Cell

  • Original Bill of Landing (B/L)
  • Copy of the Delivery Order
  • Original FTA certificates
  • Copy of Terminal discharge report

To know more on GST rates, logistics and operation for delivery systems, click here

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Post by Peter

Peter is a Senior Content Writer and Copy Editor in Finance specializing in GST and Import & Export. He has also written articles on Medical, Philosophy, and Literature and published research papers in international journals.