What is AEO - T1?

The AEO T1 certification is the initial level of the AEO program. AEO T1 is often preferred by small and medium enterprises (SMEs) or businesses initiating their journey towards obtaining a higher level of AEO certification, as it involves minimal disruption to operations and provides a solid foundation for further certification upgrades.

Who Should Apply for AEO T1?

• Importers and exporters involved in regular international trade.
• MSMEs seeking trade facilitation benefits with reduced compliance burdens.
• Companies aiming to build a secure and compliant supply chain framework.

Eligibility Criteria

1. Minimum Document Handling Requirement:
   1. The applicant must have handled a minimum of 25 shipping documents in the last financial year, including:
      1. Shipping Bills (S/B)
      2. Bills of Entry (BoE)
   2. For Micro, Small, and Medium Enterprises (MSMEs), the requirement is lower, with a minimum of 10 shipping documents handled in the previous financial year.
2. Involvement in Customs-Related Work:
   1. The business must be directly involved in customs-related operations such as:
      1. Importing or exporting goods
      2. Filing shipping bills and bills of entry
      3. Handling customs clearances and duties
3. Participation in the International Supply Chain:
   1. The applicant must be an active participant in the international supply chain. This involves engaging in the cross-border movement of goods, either as an:
      1. Importer
      2. Exporter
      3. Logistics service provider (in some cases)
   2. Being part of global trade operations ensures the relevance of the AEO certification for securing and facilitating trade flows.
4. Certification Limited to Legal Entities:
   1. AEO T1 certification can only be awarded to a legal entity that holds a distinct legal identity.
   2. It cannot be granted to a group of companies or a business conglomerate as a whole.
   3. Each entity must apply for certification separately based on its customs-related activities.
5. Minimum Business Activity Duration:
   1. The applicant must have been operational and actively engaged in business for a minimum of:
      1. Three financial years for standard enterprises.
      2. Two financial years for MSMEs.
   2. This ensures the entity has an established track record of compliance and operational history before applying for the certification.

Benefits Associated

1. High Facilitation:
   1. Refers to expedited clearance and minimal intervention during customs processes for trusted and compliant entities.
   2. Often part of Authorized Economic Operator (AEO) programs, enabling quicker cargo clearance based on a company's compliance history.
2. DPD/DPE (Direct Port Delivery/Direct Port Entry):
   1. Direct Port Delivery (DPD): Allows importers to take delivery of their cargo directly from the port, bypassing the need for intermediate warehousing. It reduces dwell time and storage costs.
   2. Direct Port Entry (DPE): Enables exporters to bring goods directly to the port for loading onto ships without needing pre-export warehousing. It speeds up export processes.
3. BG 50% (Bank Guarantee 50%):
   1. Refers to a requirement where only 50% of the standard bank guarantee (BG) amount is needed from trusted traders under the AEO or similar schemes.
   2. This reduces the financial burden on businesses while ensuring compliance security.
4. Expedited Investigation-Dispute Resolution:
   1. A streamlined process to resolve disputes or conduct investigations swiftly, minimizing disruptions to business operations.
   2. Often part of trade facilitation policies aimed at faster dispute handling with customs or regulatory authorities.
5. On Request 24 x 7 at all Sea-ports and Airports:
   1. Provides round-the-clock customs and logistics services, including cargo clearance and inspection, available on request.
   2. Essential for time-sensitive shipments and reducing delays at ports.
6. OSPCA Once a Year (On-Site Post Clearance Audit):
   1. On-Site Post Clearance Audit (OSPCA): A single annual audit conducted at the importer's premises rather than multiple checks throughout the year.
   2. Reduces compliance burdens while ensuring accountability and adherence to customs regulations.
7. ID Cards/Space in Warehouse:
   1. Refers to the provision of authorized ID cards and designated spaces within warehouses for customs officials or trusted personnel.
   2. Enhances security and allows for easier supervision and customs facilitation at the warehouse level.
8. Email on Arrival/Departure:
   1. Automated email notifications to stakeholders (importers, exporters, customs brokers) upon the arrival or departure of cargo.
   2. Enhances supply chain visibility and helps in proactive planning for cargo movement.

Verification Process

It involves a comprehensive document-based verification process without any physical site visits or on-ground inspections. This tier is designed for businesses that can demonstrate their compliance with customs laws and security measures primarily through documentation.

Documentation

To qualify for AEO T1, the applicant must submit a detailed set of documents to the customs authority, which typically includes:

1. PAN CARD
2. PROCESS MAP
3. SITE PLAN OF THE LOCATIONS
4. IEC
5. CERTIFICATE OF REGISTRATION OF COMPANY
6. GST REGISTRATION
7. BALANCE SHEET FOR PREVIOUS THREE FYs
8. SOLVENCY CERTIFICATE BY AUDITOR FOR PREVIOUS THREE FYs
9. UNDERTAKING OF FINANCIAL SOLVENCY FOR PREVIOUS THREE FYs

The AEO T1 certification process is purely document-based. Once the applicant submits the required documents, the customs authority reviews them to ensure the business:

1. Maintains proper record-keeping practices.
2. Adheres to customs regulations and international trade laws.
3. Implements supply chain security measures.
4. Has a good history of regulatory compliance.

No physical verification or site inspection is conducted at this tier. If the documents meet the requirements, the AEO T1 certificate is granted.

Validity Period

The validity of the Authorized Economic Operator (AEO) certificate varies depending on the certification tier. AEO-T1 certificate is valid for three years from the date of issuance.

Renewal

The AEO-T1 status is to be renewed 30 days against application lapse of their validity.

How Ikargos.com Can Help in AEO Certification

The starting point for an AEO certification involves establishing robust documentation and Standard Operating Procedures (SOPs) focused on security, safety, and the systematic movement of goods in international trade. At iKargos.com, we specialize in guiding businesses through the entire AEO certification process by helping to document and formalize trade processes through well-defined SOPs, which form the foundation of a successful AEO program.

We adopt a comprehensive hand-holding approach to ensure smooth attainment of AEO status, from the initial readiness assessment to the final approval. Here's how we can assist your organization:

1. Assessment of Current Security Standards:
   We conduct a thorough review of your existing security measures and other critical areas necessary to qualify for AEO status.
2. Development of SOPs and Compliance Framework:
   Our experts assist in preparing detailed SOPs aligned with AEO requirements, establishing the necessary standards for security, risk management, and trade compliance.
3. Document Collection and Application Preparation:
   We provide hands-on assistance in gathering all required information and supporting documents for the AEO application, ensuring accuracy and completeness.
4. Application Filing and Clarifications:
   iKargos.com supports the entire process of application submission, including drafting, filing, and responding to clarifications or queries raised by AEO authorities.
5. Internal Compliance Audits:
   We conduct an independent internal review to assess compliance with AEO security standards, identifying gaps and suggesting corrective actions before external verification.
6. Physical Verification Readiness:
   Our team offers expert guidance to prepare your organization for physical verification by AEO authorities, including mock audits and gap analysis.
7. Support During Physical Verification:
   We assist during the physical verification process, ensuring all documentation and security protocols meet the required standards.
8. Follow-Up and Certification Procurement:
   iKargos.com handles continuous follow-ups with AEO authorities to ensure the certification process is completed smoothly and promptly.
9. Post-Certification Compliance Management:
   We continue to support your organization in maintaining AEO status by ensuring ongoing compliance with the certification's regulatory requirements.

With iKargos.com, your journey towards AEO certification is streamlined, efficient, and compliant, ensuring you receive the full benefits of global trade facilitation and enhanced supply chain security.

For Consultation on AEO filing and renewal process please contact.

Manju Laur (+91 9711994042), 9811803136

certification@ikargos.com, rekhaatri@ikargos.com

For more information on Benefits of certificate under AEO scheme:

WHAT IS AEO?, FAQ's

In a hurry to get the AEO certification? Fill up this form, or click here

https://dwivediprashant.typeform.com/to/mfwK9rNw or call Manju Laur (+91 9711994042)