Export Obligation (EO) Extension – Simplified Assistance
✅ What is Export Obligation (EO)?
Under schemes like EPCG, Advance Authorization, and DFIA, exporters are required to fulfill Export Obligations (EO) within a specified time frame by exporting specified goods or services.
Failure to meet EO can lead to penalties, duty demands, and license cancellation.
However, the DGFT allows extensions under specific guidelines upon valid justification.
📌 When is EO Extension Required?
Delay in execution of export orders
Machinery/production line installation delays
Regulatory/approval delays
Market disruptions (e.g., pandemic, war, trade barriers)
Raw material procurement issues
📋 Types of Export Obligation Extensions
| Scheme | Normal EO Period | Extension Permissible | Conditions |
|---|---|---|---|
| EPCG Scheme | 6 years | Up to 2 years | Requires additional composition fee, valid reasons |
| Advance Authorization | 18 months | Up to 6 months or more | With proportionate bond extension & justification |
| DFIA | 18 months | Case-specific | Subject to approval and EODC status |
⚠️ Important Notes
Extensions must be requested before EO expiry, not after default
Composition fee is calculated based on duty saved and EO shortfall
For second extensions, stricter scrutiny is applied by DGFT