An Overview of Norms Fixation for Advance Authorization

Standard Input-Output Norms (SION) provide that the exporter or applicant must ensure that the goods or input items utilised in the export or output items are those that are imported. However, if the exporter plans to utilise more materials or makes a greater claim of wastage, they might request that the SION's rules be altered. Alternately, if the export product is not on the SION List, the exporter may also set the standards under HBP 4.07, para. Manufacturer exporters and merchant exporters are both eligible to submit the application. Therefore, the DGFT could ask the exporter to set standards for the quantity of inputs needed per unit of the final export output.

The objective of GSP

Under the Standard Input-Output Norms (SION), which are broken down by industry, the DGFT determines the quantity of input needed to create one unit of output for export. For example, chemical and related products, electronics, engineering, food items, handicrafts, leather, plastics, sports, textiles, and food products like fish and other marine products are all sectors or product groupings that fall inside the scope of SION.

Typically, the DGFT occasionally posts notifications on the DGFT website for the fixation and insertion of SION.

Here, we go over the numerous procedures for fixing or fixing ad-hoc norms that are utilised to process advance authorizations.

Category of Norms

There are following two categories of norms:

1. Standard Input-Output Norms (SION)
2. norms fixed

1. Standard Input-Output Norms (SION) :

The Standard Input-Output Norms (SION) collection of norms specifies the quantity of inputs needed to produce one unit of output for export. More than 10,000 products are listed there in various areas. Manufacturer exporters and merchant exporters must submit an application to the DGFT Head office in order to alter an existing SION.

2. Ad-hoc norms fixed

The Exporter must approach the Norms Committee at DGFT New Delhi if there are no Standard Norms for a specific export product in order to have the Norms Fixed for the Export Item through Prior Fixation of Norms or Fixation of Norms after obtaining the Advance Licence. The term "Ad-hoc Norms Fixed" refers to all such Norms fixed under this category.

How Exporter can Search Norms?

To Search existing SION norms see the below procedure:

• Go to [https://www.dgft.gov.in/CP/] to the DGFT website.
• Navigate to Regulatory Updates.
• Click on SION to view a list of chapter-by-chapter notes for the exporter.
• The exporter can view the current SION of those chapter notes by selecting the Chapter notes and then clicking.

Here you will see the list of Chapter wise notes

Also, the exporter can see the Application Master Data of SION, Ad-hoc Norms, No norms/Self Declaration Norms in the following way:

• Check out the DGFT webpage.
• Navigate to Regulatory Updates
• The Application Master Data link
• Then select SION Chapter-wise Notes, Ad-hoc IO Norms, or Standard IO Norms.
• Exporters can view the types of standards, Export Product Groups, ITS (HS Code), and their descriptions here.

Norms Committee (NC) Role for Fixation of Norms

According to the Indian Trade Classification (Harmonised System) - ITC (HS) of export products (Annexure A), there are seven norms committees (NC).

We have various Norms Committees for various commodities.

The information of the norms committees, product groupings they address, and relevant HS Chapters in regards to norms fixation are listed below.

Roles of Norms Committee:

• The applicant submits the ad hoc form application together with the project reports.
• The regulations Committee evaluates the application of the ad hoc regulations before determining the wastage proportion that the exporter should be entitled to with the aid of various expert advisors.
• Exporters who disagree with the NC's determinations have four months from the date of the decision on the ad hoc norm fixation to re-present their case to the relevant NC.
• SION List is created and managed by the NC.
• Ad hoc norms will be converted to Standard Input Output Norms (SION) by the norms committee within six months, and ideally within a year, of the date of ratification.

Documents required for Fixation of Norms/Norms Fixation.

Following are the documents required for Norms Fixation under Advance License:

• DSC DGFT.
• IEC replica.
• ANF- 4B, the application form.
• Valid RCMC Copy
• GST Certificate Copies.
• Chartered Engineer Certificate, Appendix 4E.
• Receipt for Appendix 4K application fees.
• Data on production and consumption from the three fiscal years before.
• If taken, an ADVANCE LICENCE copy.
• Data on production and consumption from the three fiscal years before.
• If taken, an ADVANCE LICENCE copy.
• Information about earlier licences acquired (if any) for the end product during the two licencing years prior.
• Technical reasons for claims of waste at each stage of the manufacturing process are included in the detailed technical Notes on the manufacturing flowchart.

Fixation of Norms procedure - How does the Norms Fixation work?

We can get norms fixed in two ways:

Prior Fixation of Norms

Fixation of Norms after obtaining the Advance Authorisation.

Please find an image below which explains all the above two ways in a simple manner-

1. Prior Fixation of Norms:-

Prior Fixation of Norms refers to the situation when the applicant desires to have the ad hoc norms set before applying for advance authorization but the norms have not yet been published.

• ANF 4B and the required documentation are physically sent by the applicant to the concerned NC at DGFT headquarters.
• The application can also be submitted online by the applicant. In this scenario, the relevant NC will be automatically chosen based on the goods for fixing SION/Ad-hoc norms.
• It is crucial to ensure that the ANF 4B and mandated documents are written accurately.
• Submit the application after entering all the necessary information.
• On the basis of the application, the norms committee will attempt to either fix these standards or establish ad hoc norms.
• The DGFT website will include the decisions made by the Norms Committees.
• Any ad hoc standard established under this method shall only be applicable to the specific authorisation for which it is applied, and no subsequent authorizations shall be granted. The validity period of such ad hoc standards, however, may be extended by the standards Committee by two years from the date of fixation.
• For established ad-hoc rules, the applicant will submit an application for advance authorization.
• These ad hoc regulations will serve as the basis for the import authorization.
• The applicant then goes on to fulfil the import and export obligation.

2. Fixation of Norms:

It takes a lot of effort and money to prioritise norms. Therefore, in accordance with HBP Paragraph 4.07, DGFT decided to process the applications for Norms Fixation and Advance Authorization simultaneously.

• Advance Licence will be submitted to the DGFT along with the required aforementioned papers, and a copy of the application will also be sent to the relevant Norms Committee.
• Such an application requires independent chartered engineer certification.
• The application will be examined, reviewed, approved, and finalised by the relevant norms committee.
• The relevant norms committee draughts the minutes and posts them online at DGFT.
• The applicant can finish the import in the interim.
• The rest of the process stays the same, such as the exporter fulfilling their export duties within the allotted time.

How can we assist you with Norms Fixation?

• We assist you in putting together the paperwork needed to apply for Norms Fixation at DGFT Headquarters.
• Coordination with the Norms Committee and different technical officers/members to ensure the matter is presented properly.
• Obtaining emphasis on ad hoc norms.
• Obtaining the Norms Committee's fixation of the norms.
• Advising on the formal requirements & compliances that the client must adhere to after the issuance of the norms fixation.
• Obtaining an amendment and dealing with a norm's denial.
• We support ad-hoc norms. When the export has been completed and the redemption is awaiting fixation of norms, fixation of advance authorization is required.
• Additionally, the fixation of SION necessitates a thorough examination of the variety of goods produced, and we have professionals on our team who are authorities in the field.

Frequently Asked Questions

Frequently Asked Questions

What is Standard Input Out Put Norms (SION)?

The Standard Input Output Norms (SION) refers to the inputs and outputs that are fixed in Hand Book of Procedure Vol. II, which is issued by DGFT.

What is an Ad hoc norms?

Ad hoc input and output standards are used for export products for which there are no SIONs (Standard Input Output Norms) that have been notified by the DGFT.

What is Ad-hoc Norms Fixation?

Ad-hoc norms are particular Input-Output standards for a product that is exported but does not have a SION (Standard Input Output Norms). In these circumstances, the DGFT issues the licences based on the applicant's self-declaration. The Norms Committee (NC) then approves these standards. Ad-hoc Norms Fixation is the term for this.

What is Fixation of Norms?

Fixing norms refers to situations in which applicants desire to have ad hoc norms defined before applying for advance authorization or in which norms have not been announced.

Which form need to submit for Fixation of Norms?

ANF 4B, Appendix 4E, Appendix 4K & Application fees form needs to submit for the Fixation of norms.

What is Norms Committee?

The DGFT headquarters executives make up the Norms Committee (NC), which is responsible for setting norms. In order to fix ad hoc norms, there are currently 7 norms committees organised by sector. The members of this group also include representatives from the Department of Revenue and the DGFT, as well as technical specialists from several ministries. Standards Committee Who decides how much of each input is needed to produce one unit of the export good? The input-output ratio, often known as the norms, is fixed by the NC at the DGFT office. If SION is absent and the applicant wishes to have the ad hoc input-output norms corrected prior to applying for Advance, the NC will grant approval of the ad hoc input-output norms.

Why Fixation of Norms needed?

The exporter or applicant must confirm that the imported goods and input items are used in the export and output items. However, if the exporter plans to use more inputs during the production process and makes a greater wastage claim, he will need to have the norms fixed for the existing SION.

Where we need to apply for Norms Fixation?

One can apply for fixation of Norms to the Norms Committee at DGFT (Head Quarters), New Delhi

How can we assist you for Norms Fixation?

Our experts assist you in getting norms fixations for your inputs & outputs from DGFT as under:

• We assist you in creating the necessary paperwork for the Norms Fixation application.
• Getting the Director General of Foreign Trade in Delhi to fix the standards.
• Advising on the formal requirements & Compliances that the Client must adhere to after the issuing of Norm Fixation.
• Obtaining a change, improvement, or extension for an advance licence for which standards have been established.

What is the ad-hoc norms validity?

The ad-hoc norms are valid for a single authorization.

What is Self-Declared Norms?

If the required export product is not present in the SION or the exporter is not pleased with the permitted import quantity, he may use this technique to request for an advance authorization licence on a self-declaration basis. He will choose the Import Items and Quantity of Import Items here according to his needs. In order to fix ad-hoc norms and have them ratified, the applicant must apply to the norms committee (DGFT Delhi). Only if the Norms Committee approves or ratifies the norms will the advance Licence be closed. If the Norms Committee rejects the applied norms, the applicant must pay customs duty plus interest on the excess import quantity and terminate the advance licence.

What is Prior Fixation of Norms?

In order to obtain the standards set or confirmed using this technique, the exporter must first contact the standards Committee. The DGFT will only thereafter provide an advance licence based on the predetermined standards.