POLICY CIR NO. 24/2008, DT. 04/08/2008

Clarification regarding Payment received in (FEE) / Indian Rupees by airport service provider for (EO) fulfilment under EPCG Scheme.

Representations have been received from Trade and Industry seeking clarification on the above subject.

2.1 Following payments received in FFE by Airport Service Provider for the services rendered to foreign Airlines / foreign nationals are eligible for EO discharge under EPCG Scheme.

1. Aircraft landing and parking charges, from foreign airlines.

2. Land and space rentals, warehousing charges, demurrage charges, de-stuffing, X-ray, carting, and packing charges from foreign airlines.

3. Common user terminal equipment (CUTE) counter charges from foreign airlines.

4. Passenger Service Fee, only for the part collected through domestic or foreign airlines from foreign nationals alone.

5. Payment received from ground handlers by airport service provider, provided ground handler does not count the same towards their own EO fulfillment and gives a disclaimer to that effect under EPCG.

2.2 Following payments are not eligible.

1. Licence fee or rentals paid by Trade Concessionaires (TCs) to airport service providers.

2. Payment received from duty free shop operators by airport service provider.

3. Security portion of passenger service fee.

4. Cargo handling service charges etc., so far as they pertain to Indian consumer (who pays for it).

In the case of airport service provider, it may be noted that as per Para 9.53 (iv) of Foreign Trade Policy payment made by foreign airlines from their repatriable or remittable earnings in Indian Rupees, which are otherwise considered as having been paid for in free foreign exchange by RBI is to be counted as free foreign exchange.

This issues with the approval of Director General of Foreign Trade.

(G. Seetharam Reddy)
Jt. Director General of Foreign Trade

(Issued from File No.01/36/218/24/AM09/EPCG-I)

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