IPR - Export Equivalency and Multiple Authorizations

[Former Member]

Dear Experts

I have a couple of questions on the GTS IPR process;

1. How does the Prior Export Equivalency (PEE) works in IPR. What steps need to be executed to determine whether Equivalency was applied after re-export

2. In case the client hold separate authorizations for its FTOs, how does GTS handle the duty liability transfer between the entities. Is there a process for C88 SAD Procedure in GTS

Request your inputs on these.

Regards

Amit

[lozanov-a · Accepted solution]

HI Amit,

for point 1).

As far as i remember, this is an arrangement with the Customs authorities that one material code (component) can be declared for re-export (as part of finsihed goods) without a precise check/track if the compoenents contained in this FG are procured domestically or imported. Both sources can be mixed during the production transformation.

there is a flag in the IPR licence in GTS; Equivalence principle.

Besides that, maybe on the Stock overview for a product there maybe a field as well, but i dont think you need further settings in the system.

The important is that the products procured domestically are entered in a non IPR Storage location and the imported components are received in an IPR storage location. The finished goods could be all stored in the IPR storage location  - the imported and domestically procured components are mixed. During re-export, the sales is picking from the IPR storage location, the system can't consume more components than what was initially received in the IPR storage location. This ensures there is no abuse. This is how i have proceeded with the Equivalence principel for IPR.

I am not sure this helps you.

I hope so

Kind regards

Assen

[former_member215181 · Accepted solution]

Hi Amit,

Just to clarify Assen's answer; the "prior export" of IPR goods is allowed in case the customer requires the goods more urgently than the vendor can supply.  In that case, if the trader already has stock in free-circulation, and provided there is no appreciable difference between that stock and the stock to be purchased from the IPR vendor (that's to say, the customer would find them equivalent, and could not prefer one above the other), the trader may supply the free-circulation stock and subsequently "back-fill" by importing to IPR.

The system models that equivalence by allowing the IPR stock quantity to go negative until such time as the new import to IPR is made.

Hope that helps.

Regards,

Dave

[Former Member]

Thanks Assen and Dave for the response.

The Equivalency principle was the only relevant setup I found as well in authorization. In the stock list, if my re-exports exceeded the imports for IPR goods, I will see 'Total anticipated stock' as the balance. The export declaration that is created for the balance qty. will not have the 'IP closing portions' info but is displayed in the receipt/issue list.

Is there any other std. report that provides clear visibility of the documents that correspond to the free circulation stock used for IPR export instead of the drill down I need to do from the FIFO or Receipt/Issue list.

Dave, what is that 'appreciable difference' which, if exceeded, will throw up an exception or error - is this configurable in the system?

Appreciate if someone can also throw light on the second point related to authorization in my post:

"In case the client hold separate authorizations for its FTOs how does GTS handle the duty liability transfer between the entities carrying these separate authorizations. Is there a way in GTS to handle C88 SAD procedure?"

Regards

Amit

[former_member215181]

Hi Amit,

To answer your questions:

The "appreciable difference" is the Product number, and (if used) the "Stock ID" or Country of Origin.

There is no way to handle IPR transfers in GTS, either internally or externally.  It's unfortunate, but true.

Regards,

Dave

[Former Member]

Thanks for your inputs Dave. Will need to look at the custom functionality for IPR transfers then.