Brc

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23 January 2013 HOW AND WHEN WE ARE PREPARE A BRC
AND WHAT BENEFIT TO GIVE US.

RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
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24 January 2013 Government provides certificate only when the export proceeds are realised and Bank Certify the same that the foreign currency were been received , realisation rate is the rate at which currency were converted into INR.

BRC is prepared after the net proceeds have been realized in our account.

Important Documents required for preparing the BRC:
1) Credit Advice Copy
2) Shipping Bill
3) Invoice

Page 1 of BRC

1. Bill Amount: Mention the Invoice Amount (USD) ……..Exchange Rate to be taken which is mentioned in the Credit Advice Copy….(exchange rate @ which funds have been credited)

2. Freight Amount : Take the amount which is mentioned in the Shipping Bill (USD) and convert as per the Exchange Rate mentioned in the Credit Advice Copy

3. Insurance: Take the amount which is mentioned in the Shipping Bill (USD) and convert as per the Exchange Rate mentioned in the Credit Advice Copy

4. Commission: NIL

5. Export is freely convertible in Rupees: Mention FCC

6. FOB Value: Calculate as follows: 1-2-3 (i.e Invoice Amount – Freight Amount – Insurance Amount) and convert as per the Exchange Rate mentioned in the Credit Advice Copy

7. Date of Realization of Export Proceeds : Mention the Transaction Date as per the Credit Advice Copy

Page 2 of BRC

1. Ref No: Mention the Export Ref No. given by the bank and mentioned in the Credit Advice copy. -> Bill N0.

2. Date: Mention the date of Realization of payment -> Transaction Date

3. We have also verified that the date of the connected mate receipt as indicated in the relevant Shipping Bill is _____________ -> Mate Receipt : Sailed Date

4. Date of Export is -> Invoice Date

After the BRC is prepared, kindly send it to the bank for Endorsement….(attach a xerox copy of Invoice & Shipping BL) pertaining to that Export along with the BRC.

Notes:

In BRC, Commission or Discount shown but for only informative. It will not be deductible from CFR value.

As the CFR/CIF value of export are inclusive only freight/insurance values hence calculation of FOB is only make after deduction of above only.

If you are sending doc directly to buyer then you have to submitt doc like copy of Invoice, copy of BL/AirWaybill original shipping bill to bank for clearance of GR. When bank clear the GR he will creat a Ref no and you can get BRC from bank by quoting this Ref no on BRC Please be aware that as per RBI norms Export Doc must be submitted to bank in 7 days (in case of AIr) & 21 days (in case of Sea)

after getting the BRC you will submit in RDGFT OFFICE AND DEPARTMENT ISSUE THE CHAPTER-3 INCENTIVE 4 AND 5 AS PER FOREIGN TRADE POLICY 2009-2014
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GOVERNMENT OF INDIA
MINISTRY OF COMMERCE AND INDUSTRY
DEPARTMENT OF COMMERCE
DIRECTORATE GENERAL OF FOREIGN TRADE
UDYOG BHAVAN, NEW DELHI

Policy Circular No. 01 (RE- 2012) /2009-14

Dated 18th June , 2012

Subject: Introduction of electronic Bank Realization Certificate (e-BRC) system.

Through Public Notice No. 02 dated 5.6.2012 electronic issuance of BRCs have been initiated which obviates submission of physical copy of BRC to claim benefits of the FTP Schemes.

2. Following are for information and guidelines:-

A. For Banks:-

Uploading of BRC data by banks can be done at any time and it should be electronically transmitted on a daily basis.

Electronic issuance of BRC has started with effect from 05.06.2012. Physical submission of BRC would continue concurrently for one month from 05.06.2012. BRCs which have been issued manually after 01.04.2012 shall be converted in the digital (XML) format by the banks and uploaded on DGFT server. This exercise may be completed by 31.07.2012.

Banks shall upload the rupees equivalent of the realised foreign exchange, based on the monthly exchange rate notified by Central Board of Excise and Customs (CBEC), Ministry of Finance. In case the realisation is in a denomination other than the notified currency, the rates given by RBI shall be adopted. In case exchange rate is not available from RBI then banks will do currency conversion as per their present existing practice.

B. For exporters:-

e-BRC details available in the DGFT server will not contain the details of amount of commission paid. This amount has to be provided by the exporter at the time of filing online application.

C. For RAs:-

The net foreign exchange earnings (in foreign currency) reflected in e-BRC, transmitted by banks would indicate FOB value (as per valuation made by custom authorities on the shipping bill). While granting Chapter 3 benefits, RA shall consider the net foreign exchange earnings. In case of shortfall in foreign exchange realization with respect to the shipping bill FOB value, pro rata distribution of realized foreign exchange against each export item will be made by the system itself. To explain in detail, three illustrations are given below:-

Illustration 1 (Single Export Product) – If NFE as per e-BRC is US $ 100/- and FOB value as per Shipping Bill is US$ 80/- , then benefit would be granted on US $ 80/-.

Illustration 2 (Single Export Product) - If NFE as per e-BRC is US $ 100/- and FOB value as per Shipping Bill is US $ 120/- , then Chapter 3 FTP benefit would be granted on US $ 100/-.

Illustration 3 (Multiple Export Items On Single Shipping Bill) - If Shipping Bill contains 3 export items A,B and C with FOBs US $40, US $60 and US $80 respectively (total FOB US $180/-). If the total NFE realised as per e-BRC is US$90/-, then by pro-rata calculation the benefits on 3 items i.e. A, B and C will be calculated on 20 US$, 30 US$ and 40 US$ respectively.

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

(Rajiv Arora )
Joint Director General of Foreign Trade
E-mail: rajiv.arora@nic.in
(Issued from F. No. 01/02/110/AM 12/EDI )