REGISTERED No. D. 221
The Gazette of India
EXTRAORDINARY
PART I—Section I
PUBLISHED BY AUTHORITY
No. 204] NEW DELHI, THURSDAY, DECEMBER 21, 1967/AGRAHAYANA 30, 1889
Separate paging; is given to this part in order that it may be filed as a separate compilation.
MINISTRY OF COMMERCE
PUBLIC NOTICE
IMPORT TRADE CONTROL
New Delhi, the 21st December 1967
SUBJECT:—Surcharge on freight due to closure of Suez Canal and diversion of ships
via Cape of Good Hope—Payment arrangements therefor against licences
under U.S. Aid and other Loans.
No. 199-ITC(PN)/67—Attention of importers Is invited to Ministry of commerce Public Notice No. 76-ITC(PN)/67 dated the 8th August1967 setting out the pro other's surcharge on freight against licences issued under AID. and
2- In regard to AID Loans, the U.S. Aid Authorities have stipulated certain conditions. the fulfilment of which is a prerequisite now to make the surcharge on freight on shipments arranged under AID Licences eligible for AID financing. The
ed by the
following
]
(1) This applies to licences in respect of which letters of authorisations for opening letters of credit have been issued Under AID Non-project Loans 160 and 168. In respect of goods already shipped after 23rd June, 1967 against authorisations Issued under AID Non-project loans 138 and 155 (since closed), for which the payments for surcharge, If any, are still outstanding, a reference should be made to the Senior Accounts Officer, Department of Economic Affairs, Ministry of Finance Jeevan Deep Building, Parliament Street, New Delhi with the full facts of the case.
( 8 2 9)
83O THE GAZETTE OF INDIA 1LXTRAORDINARY [PART I-SEC. I](2) In respect of sales contracts already co>ieluded.—Since the contrsrt is between the importers and their suppliers, it is for the importers to see whether they are liable to pay the surcharge under the terms of their contract- (The AID have., however, advised that, in their view far all true C and F contract*), the risk of all freight fluctuation, in- cluding surcharge, is on, the seller in all such contracts). In case the importers accept the liability to pay the surcharge, the payment of surcharge to the supplier/shipper should be arranged in the under- mentioned manner: —
A. Surcharge relating to U.S. flag Liner Vessels—(I) The surcharge, aa evidenced due to 1he closure of Suez Canal and diversion i
(i) the contract is on F.OB, or F.A.S. basis (The F OB or F-A S. prices should be clearly indicated in the letters of credit whether or not C & F prices are separately stated) and provisions of AID Regula- tion I are complied with, especially Section 201.13(b)(IV) (Repro- duced as Annexure):
(ii) the Cargoes are delivered, as evidenced by relative dock receipts, to US liner carriers on and after June, 23, 1967; and
(iii) the surcharge is (a) to the extent of 25% of original freight amount in respect of shipments upto 22nd September 1967 and (b) to the extent of 15% in respect of shipments from 23rd September, 1967.
In cases where the above mentioned conditions are satisfied and surcharge qualifies for AID financing, the importers should initiate action to: —
(a) Amend the relative letters of credit through the Indian Banker—
(i) to prevent the payment of surcharge from AID funds unless the dock receipt is dated June 23, 1H67 or later;
(ii) to clearly state the F.O.B- or F-A.S- price, whether or not C & F prices are separately stated.
(b) notify the suppliers directly—
(i) of the above conditions under which the surcharge will he paid by the
U.S Bank from AID funds;
(ii) that copies of the docfc receipt issued by the ocean carrier will be an v additional document required for reimbursement in respect of pay- ment of these freight surcharges.
Where the amount of the letter of credit or that of Letter of Credit authorisation issued by the Ministry of Finance is not sufficient to accommodate the surcharge and suitable increase thereof is required to cover all shipments, a request to this effect should bo made to the Ministry of Finance, Department of Economic Affairs, Economic Aid Accounts Branch with a certification that the conditions for AID - financing as set out in this Public Notice have been satisfied. If the desired en- hancement is not covered by the value of Bank Guarantee already furnished, the request for enhancement should be supported by an additional bank guarantee or suitable amendment to the original Bank Guarantee to cover the Increase On receipt of the request, the Ministry of Finance will issue additional authorisation If the request is In order- Thereafter action may be taken, through Indian Bank concerned, for increasing the value of the letter of credit. But as long as the amounts of letters of credit already set up are sufficient to accommodate the sur- charge, the shipments and payments can proceed if the U.S. Bank Is authorised to rrake such payments-
(It) In respect of the surcharge relating to U.S. Flag Vessels, which does not qualify for AID financing under sub-clause (I) above i.e..
(i) where cargoes are delivered to liner vessles before June 23, 19(S7 as evidenced by dock receipts or
(HI where contracts are on C&F or c-i.f. basis, the U.S. Banks will, after pavment, claim reimbursement therefore from the Indian Bank con- cerned. The latter Banks will then remit the surcharge at rates noV exceeding those mentioned at A.I. (iii) above in such cases to thc^ U.S. Bank In the usual manner, notwithstanding anything to the con- trary mentioned in this Public Notice- F-O.B. and normal fright, charges (excluding surcharge) will, however, be financeable from AID funds In such cases-
[PART I—SFC. I] THE GAZETTE OF INDIA EXTRAORDINARY 83IB- Surcharge on U.S. bulk carriers and tankers.—In respect of all bulk carrier and tanker charter shipment; the approval of AID Is obtained in advance, and the AID will therefore finance freight only tn the extent the rates art' approved by them. Therefore no freight surcharge will be financed by AID if iL is over and above the freight lates approver! by them. The AID approval of charter in each case will indicate the rates (including surcharge, if any) approved by AID. In this connection, AID have claufisd that approval of charter by them after June 23rd, 1967 does not constitute AID willingness to increase AID funding to cover freight increase:; for true C and F sales contracts concluded nefore June 2'A, 1967- However, in cases where surcharge in nut eligible for AID financing, and the importers accept the liability of payment, they arc permitted to make the pay- ments out of fren foreign exchange. Tlie pioredure of payment will be same as under A (I) or (II) above;, as the case may bo.
C. Surcharge on non-U.S. Vewrls.- Tn regard to surcharge on non-U,S. Vessels, the increased freight crnrgor. ran he lemiHed like normal freight charges at rates not exceeding those mentioned al AKiii) above in the manner provided in clause (IV) of'Appendix to Public Nniice No. ] l5-ITC'(PN)/ti6 dated 11th August 1966 and amended from time to time.
(3) In respect 0/ future C&F—GIF sales contracts,—The contracts should specify C &F plus payment, of freight surcharge nt 1? per cent of _ original freight rate arising from closure of Sue/ Canal with the express stipulation that in the event of reopening of the Suez Canal, there will be a corresponding reduction, in the freight rate. Subject to this condition, the surcharge will be elidible for AID financing. The contracts should be placed by the importer •accordingly, so that surcharge may be financed out of AID funds.
(4) The existing para 2(4) of Public Notice No. 7t>-ITC(PN)/67 dated 8th August, 1967 may be amended as under: —
Licences under loans under "Direct Payment Procedures".—Same procedure as for IT. K. Loans may be followed mutatis mutandis in case of Public Sector imports under W, German credits where payments are arranged through C.A.O., High Commission of India, London,
In the case of Austrian, Belgian, Danish and Dutch Credits and other credits wh°re payments to foreign suppliers are arranged on the basis of Letters of Authorisations Issued by the Ministry of Finance (Deptt of Economic Affairs) without opening letters of credit, the importers may arrange for payment of addi- tional freight charges, if due, on the basis of Proforma invoices where available, nr suitable letters from the suppliers specifying the additional nmount and bearing reference to the original contract number and date. Such payments can be made without reference tn the Ministry of Finance, if the payment of additional amounts do not cause an excess over the amounts stipulated in the respective authorisa- tions- If. however, the additional amounts cannot be accommodated within trip limits indicated in the original authorisations, specific requests should be made to the Under Secretary/Deputy Secretary concerned in the Deptt. nf Economic Affairs of the Ministry of Finance for the issue of amendments tii the autho- risations already issued- Such requests should be supported by the abnvn mention- ed documents and additional Bank guarantees or amendments to the earlier "Bank guarantee, if the Bank guarantees already produced are not adequate to cover the additional amounts.
ANNEXURE
Extract of Section 201.13 of AID Regulation I
201.13- Eligibility of delivery Services- Delivery services will be financed by AID in the manner provided tn this $201.13
(a) General.—Delivery services which relate to AID financed Commodities may be financed under the implementing dncmnent which authorises the purchase of the commodities or under a scparale Implementing document-
(b) Conditions and limitations—(1) Freight. Unless otherwise authorised AID will not finance freight
(i) For shipment beyond the- point of entry to the cooperating country; or Cii) on any non-US flag transportation medium or any TJ.S. flag vessel trans- ferred from foreign-flag to provisional U.S. flag registry under 40 U-S.r section 12 for carriage of commodities to the "cooperating country, or to or from a free port or bonded warehouse; or
83* T HE fcAztittt! OF iNDiA EktRAofcbiNARV ri>ART i-sre. ii
(iil) on any vessel designated by A.I.D. as ineligible to carry AID financed cargo; or
(iv) on any liner vessel for which the rate applicable to the commodity shipped and applying to both AID financed and non-AID financed L'argo has not been tiled with the Federal Maritime Commission (whether or not such filing Is required by the Federal Maritime Coin- mission) ; or
(v) under any ocean or air charter covering full or part cargo (whether for a single voyage, consecutive voyages or a time period) which has not received prior approval by AID/W (Resources Transportation (Division) or
(vi) Which is attributable to brokerage commissions which exceed the limitations specified in $201.65(1) or to address commissions, dead freight or demurrage-
P. D. KASBEKAR,
Chief Controller of Imports & Exports-
ERRATUM
The Issue No. of the Gazette of India Extraordinary, Part I—Section t, dated the 25th November, 1967, containing the Public Notice No. 172-ITC(PN)/67, dated 25th November, 1987 of the Ministry of Commerce (Import Trade Control) should be "182" (Lwue No.) instead of "183".
MINISTRY OF STEEL, MINES AND METALS
ERRATUM
The Issue No. and page Nos. of the Gazette of India Extraordinary, Part I—Section I, dated the 27th November, 1967, containing the Resolution No. CS-12(18)/67, dated the 27th November, 1967 (both English ami Hindi) of the Ministry of Steel, Mines and Metals (Department of Mines and Metals) should be "183" (Issue No.) and "721/1—721/13" (page Nos.) instead of "181" and "703—15" respectively.
MINISTRY OF LABOUR, EMPLOYMENT & REHABILITATION
ERRATUM
The Issue No. and page Nes. of the Gazette of India Extraordinary, Part. ^ S e c t i on 1, 'dated the 21st November, 1967, containing the notification No, WB-17(7)/67, dated 18th November, 1967 of the Ministry of Labour, Employment and Rehabilitation (Department of Labour and Employment), should be "181" (Issue No.) and "703—718-720" (page Jvfos.) instead of "182" and "705—720" respectively.