Meaning of Status holder/export houses and their privileges

(This post covers latest updates and amendments to earlier policies envisaged in Foreign Trade Policies 2015-2020 in respect of status holders.)

The status- holder position allotted to the exporters of goods and services depending upon certain level of export performance achieved by them. The exporters of goods/service who hold valid importer-exporter code no. (IEC) may apply to Director General of Foreighn Trade (DGFT) for the recognition as ‘status- holder’ viz.  One Star Export House, Two Star Export House,  Three Star Export House, Four Star Export House and Five Star Export House.

DGFT awards status-holder position to the exporters on the basis of export performance in the current year and previous two years. The export performance is counted on total FoB/FoR value including deemed exports. However, exports made on the basis of disclaimer letter or re-export basis is not counted for recognition.

Earlier to current policy, the exporters were certified as ‘Export House, Star Export House, Trading House, Star Trading House, and Premier Trading House depending upon their export performance.  In the foreign trade policy 2015-2020, the above nomineculture certificates are changed to one, two, three, four and five star export houses on the basis of benchmark export performance spelt out in US Dollars.

1. The achievers of USD 3 millions export performance will be recognized as “One Star Export House”. The exporters belonging to MSME units, Manufacturing units having ISO/BIS, the units located in North Eastern States, Sikkim and Jammu Kashmir,units located in Agri export zone  catagories are entitled for  doublr weightage of exports made for grant of ‘one star export house status’.
2. An exporter who achieves export performance of USD 25 millions will be recognized as “Two Star Export House”.
3. An exporter who achieves export performance of USD 100 millions will be recognized as “Three Star Export House”.
4. An exporter who achieves export performance of USD 500 millions will be recognized as “Four Star Export House”.
5. An exporter who achieves export performance of USD 2000 millions will be recognized as “Five Star Export House”.

For the purpose of counting the performance in terms of US Dollars, the forex earned in Rupee denomination will be converted into US Dollars at the exchange rate notified by Central Board of Excise & Customs (CBEC) as applicable on April 1, of each year. The ‘status- holder certificates’   shall be valid for a period of five years which is counted from 1^st April of the relavant year as prescribed in the Hand Book (volume-1).  The application for renewal shall be filed before the expiry of existing validity period.

Some of the special treatments and previleges enjoyed by the status holders are as under.

(a).Status- holders are entitled for EDF Waiver (waiver of GR forms) for Export of Goods Free of Cost up to the limit of Rs 10 lakh or 2% of average annual export realization whichever is lower.

(b). Licences, certificates, permissions and custom clearance is allowed both for exports and imports on self declaration basis.

(c). Status-holders are exempted from submitting Bank Guarantee for FTP schemes save specified otherwise anwhere in FTP or HBP.

(d). Negotiating export bills through a bank is not compulsory; however, the export proceeds should be routed through banking channels.

(e). Two star export houses and above are permitted to establish ‘Warehouses’ as per guidelines of Revenue department.

(f).Three star export houses and above entitled for the benefits of Accredited Clients Programme (ACP) under Central Board of Excise and Customs guidelines.

(g). Three, Four and Five star status holder can self- certify their manufactured goods as originated from India (certificate of origin) to qualify for preferential treatment under PTAs, FTAs, CECA and CEPA.  The para 2.61 (III) of Foreign Trade Policy (2015-2020) stipulates about self-certification of origination of goods by status-holders.

(h). Eligible for fixation of Input-Output norms on priority within 60 days.

(i). Entire foreign exchange earnings (100%) can be retained in EEFC account.

(j). Normal repatriation period for export proceeds is enhanced from 180 days to 360 days.