Amendment in Customs Rules, 2001 [EFS Rules, 2021]

GOVERNMENT OFPAKISTAN

REVENUE DIVISION

FEDERALBOT? O'REVENUE

Li4

Islamabad, the, February, 2025.

NOTIFICATION

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S.R.O. 0)12025.-The following draft of certain further amendments in the Customs

Rules, 2001. which the Federal Board of Revenue proposes to make in exercise of the powers

conferred by section 219 of the Customs Act, 1969 (lV of 1969), is hereby published for

information of all persons likely to be affected thereby and. as required under sub-section (3A) of

the said section 219, notice is hereby given that objections or suggestions thereon, ifany. may for

consideration ofthe Federal Board ofRevenue be sent within seven days olpublication ofthe draft

amendments in the official Gazette. Objections or suggestions received from any person, before

expiry of the aforesaid period, shall be taken into consideration by the Federal Board of Revenue.

namely:-

DBAFTAMENDMENTS

In the aforesaid Rules. in Chapter XL. -

(1)

in rule 871,

a) in clause (a). the expression "or as approved by Engineering

Development Board (EDB)" shall after six months from commencement of

this Notification be omitted;

b)

in clause O, the expression "or as approved by the EDB" shall after

six months from commencement of this Notification be omitted;

c) in clause (m), after the words "for acquisition", the words "except

*'2. iron and steel scrap falling under the respective headings of Pakistan

Customs Tariff'. shall be inserted;

d)

clause (n) shall be omitted; and

e)

for clause (u). the following shall be substituted. namely:-

"(u) "regulatory authority" means Collector of Customs. in whose

jurisdiction the place of business or manutacturing unit of the applicant,

duly registered under the Sales Tax Act, 1990, is located. In case an applicant

has multiple manufacturing facilities in different j urisdictions, the Collector

in whose jurisdiction, the head office of the applicant or principal

manufacturing unit is located shall be the regulatory authority.";

(2) in rule 872. in sub-rule (1), after the words "following persons'', the expression ".

except persons engaged in import of iron and steel scrap falling under the respective

headings of Pakistan Customs Tarili" shall be inserted.

1,

(3) in rule 874,

a) in sub-rule (4). for the expression "per the claimed percentage ofproduction

to be expo(ed i.e.. Category A or B. which shall be subject to review by the

Regulatory Collector after one year" the expression "in Category 82" shall

be substituted:

b) lbr sub-rule (5) and the table. the following shall be substituted, namely: -

"(5) An applicant show'ing a poor compliance profile. i.e.. having

one or more contravention cases adjudged against him or having pending

recovery cases or pending criminal proceedings, the authorization granted

shall on providing opportunity of defence be suspended immediately and

the Regulatory Collector may initiate proceedings for cancellation ol the

authorization besides other Iegal action.": and

c)

sub-rule (6) shall be omitted:

(4) in rule 875, in sub-rule (2), after clause (viii), the following new clause shall be inserted,

namely:-

''(viiia) the list ofvendors in accordance with the requirements laid down in

rule 882:";

(5)

in rule 876, in sub-rule (1), -

a) fbr clause (a). the following shall be substituted, namely:-

"(a) Category A:

(i) indemnity bond as set out in Appendix-lll and PDC for

manufacturers-cum-exporters having minimum export value

S 4 of USD 20 million or above in last two years;

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(ii)

manuf'acturers-cum-exporters having exports value less than

USD 20 million in last two years. shall fumish indemnity

bond as set out in Appendix-lll and PDC equivalent to the

average annual duty & taxes of input goods used in exports

in last two years, and bank guarantee or revolving bank

guarantee shall be fumished for any excess duty & taxes

being defened or remitted:"

(b)

for clause (b), the foltowing shall be substituted, namely:-

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"(b)

Category Bl: For manufacturer-crun-exporters with a self-

owned manufacturing facility, indemnity bond as set out in Appendix-

III and PDC equivalent to the average annual duty & taxes ol input

goods used in exports in last three years. and bank guarantee or

revolving bank guarantee shall be fumished for any excess duty &

taxes deferred or remitted; and for manufacturer-cum-exporters with a

rented production facility, bank guarantee or revolving bank guarantee

covering their annual requirement;":

(c)

in clause (c), the words "Revolving Insurance", the word "Bank", shall

be substituted and thereafter the expression "for manufacturers with

self-owned manulacturing facility covering their annual requirement.

Revolving Bank Guarantee for manufacturers with rented production

lacility" shall be omitted:

(d)

for clause (d), the following shall be substituted. namely:-

"(d) Category C I : For manufacturers with a self-owned

manufacturing facility, indemnity bond as set out in Appendix-lll and

PDC equivalent to the average duty & taxes of input goods used in

indirect exports in last three years and bank guarantee or revolving

bank guarantee shall be lurnished for any excess duty & taxes deferred

or remitted, and lbr manufacturers with a rented production facility

..-\------------\ and commercial exporters. bank guarantee or revolving bank

guarantee covering their annual requirement;"; and

N

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(e)

in clause (e), the words "Revolving lnsurance", the wor$ "Bank"

shall be substituted and thereafter the expression "with a self-owned

manufacturing facility and Revolving Bank Guarantee for

manufacturers with rented production facility" shall be omitted.

(6) in rule 877,

a) sub-rule (2) and (3) shall be omitled;

b) for sub-rule (4). the following shall be substituted. namely:-

"(4)

Within seven days of the receipt of the application, the

case shall be referred to relevant Collectorate of Input Output

Coefficient Organization (IOCO) for determination of production

capacity and input output ratios within sixty days. The Collector

IOCO shall ensure that the application is processed within 60 days

olthe date of receipt in IOCO:

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Provided that in case the IOCO fails to process the case

within sixty days, the user shall be allowed acquisition of 25%o of

the value of input goods involved as declared against a bank

guarantee. The provisional permission shall be subject to

modification once the IOCO finalizes its assessment of the

production capacity and input output ratios and the same shall be

uploaded in the WeBOC or PSW System by IOCO or Regulatory

Collector.":

c) for sub-rule (5). the tbllowing shall be substituted. namely:-

"(5) In case the production capacity and input output ratios

have already been determined by IOCO or EDB, as the case may be,

the Regulatory Collector shall process the authorization on the basis

ofalready determined production capacity and input output ratios.";

d) for sub-rule (6). the lollowing shall be substituted. namely:-

"(6) The Chief Collector (Exports & IOCO) shall monitor all

pending cases to ensure their timely processing within 60 days'";

e) in sub-rule (9), the words "including the Engineering Development

Board" shalt after six months from commencement of this

)

Notification be omitted;

(2

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zra--' J) in sub-rule (ll), the expression "as well as by EDB on sectoral

ol

basis" shall after six months from cornmencement this

Notification be omitted:

e) sub-rules (13) and (14) shall be omitted; and

h) after the sub-rule (14). omitted as aforesaid. the following new sub-

rulc shall be inserted. namely:-

"(15) No authorization under this rule shall be issued

without determination ofproduction capacity and input output ratios

by IOCO, except as provided in the proviso to sub-rule (4).";

(7)

after rule 877, the following new Rule shall be inserted, namely:-

"S77(A), Drawal of samples.- The customs computerized system may assign

Goods Declarations filed under these rules for drawal of samples on computerized

selectivity criteria:

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Provided that the Regulatory Collector or the Collector of Customs in whose

jurisdiction the imports or exports are being made. ma.v also authorize the drawal of

samples by an officer not below the rank of Assistant Collector.

(2)

Three samples of imported input goods or output goods meant for export

shall be drawn at the time of import or export, respectively. duly signed by concerned

Assistant Collector or Deputy Collector and EFS authorization number and date shall

be endorsed thereon. Out of the drawn samples, one will be handed over to the EFS

user or his authorized agent, second will be retained by the drawing Collectorate and

the third will be sent to the Regulatory Collectorate. The Assistant Collector or Deputy

Collector incharge ofconcemed Customs station, shall inform the Regulatory Collector

about the cases where any discrepancy is reported against the EFS user in accordance

with law:

Provided that the Regulatory Collector may also authorize an officer not below the

rank of Assistant Collector to visit the premises of the EFS user to draw samples, in

addition to already drawn samples."

(8)

in rule 878,-

(a)

for sub-rule (3), the following shall be substituted, namely:-

"(3) The authorization ofthe value ofinput goods shall be uploaded

for each year based on annual estimated requirement determined by IOCO.

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The uploading of the authorization lor the subsequent year shall be subject

to satisfaction of Regulatory Collector that no action under the Acts is

pending against the user and the user has submitted all reconciliation

statements as set out in AppendixJV."; and

(b)

sub-rule (4) shall be omitted:

(9)

in rule 879, after sub-rule (4). the following new sub-rule shall be inserted, namely:-

"(5) The Regulatory Collector, upon satisfaction that the input goods have

been illegally removed from the premises or disposed-off or retained beyond the

utilization period or failed to achieve the value addition in the utilization period as

required under these rules, shall immediately proceed to encash the PDC or Bank

Guarantee, as the case may be.";

0)

( I in rule 880,-

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a) in sub-rule (2). for the word "thi(y". the word "seven" shall be substituted:

b) after sub-rule (3). the following new sub-rules shall be inse(ed. namely:-

"(3A) The Regulatory Collector may conduct the stock-taking of

inputs through an officer not below the rank of Assistant Collector, at any

time during the utilization period.

(3B)

The user shall ensure proper traceability of inputs through

proper inventory records which shall be made available to the officer not

below the rank of Assistant Collector undertaking stock-taking as specified

in sub-rule (3A)."; and

c) in sub-rule (4). after the expression "information, audit". the expression "

stock-taking", shall be inserted, and thereafter. after the words "been

uploaded in time," the expression "or the input goods are not accounted

for," shall be inserted.;

l)

(l in rule 882,

(u)

for sub-rule (2), the lbllowing shall be substituted, namely:-

"(2)

The user with past export performance may apply online to

the Regulatory Collector. in the WeBOC or PSW system, as per the

)

u prescribed format as set out in Appendix-V, to remove input goods out of

zt<" his premises for partial manufacture or processing by a vendor duly declared

at the time of filing his application for grant of authorization. having in-

house manut-acturing facility to perform the stated manufacturing process

at the premises of the vendor which are geo-tagged in the WeBOC

regi stration database

:

Provided that the processing period by vendor shall not exceed sixty

days from the date ol removal of goods from the user premises."; and

(b)

after sub-rule (2), the following new sub-rules shall be inserted. namely:-

"(3) All details related to the goods removed from the premises

including quantity and description, particulars of the vendor, registration

number of the vehicle and outward gate pass, shall be fed into the system

bv the EFS user on the same dav.

(4)

The vendor shall not be changed or added except with prior

permission of the Regulatory Collector concemed.";

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(12)

for rule 883, the following shall be substituted, namely:-

"883. Utilization period.- The input goods acquired under these rules shall be

utilized within 9 months extendable in exceptional circumstances by a committee to be

constituted by the Board.";

(13)

In rule 884, for the first and second proviso, the following shall bs substituted,

anamelv:-

"Provided that for supplies against intemational tenders or to exempt projects or

sectors in Pakistan, the user shall be required to file a declaration in WeBOC system";

(14)

In rule 885, in sub-rule (2A), the words "revolving insurance", the word "Bank", shall

bs substituted;

15)

( in rule 886,

a) in sub-rule (3), after the words "B grade goods", the expression "not more

than 5%o of the total production" shall be inserted and for full stop at the

end, a colon shall be substituted and thereafter the following proviso shall

be added, namely:-

o zzz "Provided that in case ol factory reiects or B grade are more than

5% ofthe total production, the Goods Declaration shall be assessed as ifthe

goods are imported into Pakistan in standard condition."; and

b) in sub-rule (4), after the words "sales tax". the expression ". or any other

leviable duty and taxes" shall be inserted;

(16)

in rule 887,

a) in sub-rule (l), clause (a) shall be omitted; and

b)

sub-Rule (4) shall be omitted;

(17)

in rule 892, sub-rule (3) shall be omitted; and

(18)

in rule 893, in sub-rule (1),-

a) for the words "as under", the expression "on annual basis for all

categories:- shall be substituted'

b)

clauses (a). (b), (c) and (d) shall be omitted. and

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c)

for the second proviso, the following shall be substituted, namely:-

"Provided further that the system may assign the audit to the

regulatory Collector instead ofthe Directorate ofPost Clearance Audit."

o 7 Pl20t9-

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(Sha rq-

Secretary licy)

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