Tougher licensing norms for customs house agents likely

NEW DELHI: There''s going to be a change in the licencing norms for customs house agents, which have been in force for over two decades now. The finance ministry has decided to scrap giving temporary licences to CHAs as the present practice is considered discretionary, making it tough for new entrants.
The ministry has also called off the practice of fixing fees to be charged by the CHAs. From now on, the rates to be charged to clients will be determined by market forces. The move, which is in line with the recommendations of the Kelkar panel on indirect taxes, is expected to induce competition. This will result in better service and accountability to the clients.
CHAs will be licensed through an all India entrance exam conducted by the directorate general of inspection and licences. After that, the CHAs can operate from any customs house, port, inland container depot in the country subject to a simple registration of the business premises.
Entry will be tougher now. Knowledge of computers would be mandatory for aspiring CHAs. Only those with a graduate or a post-graduate degree would be eligible to write the entrance exam. Licenses will be valid for 10 years. The minister of state for revenue Shripad Naik will make a formal announcement on the new norms on Tuesday.
While the licencing regulations for CHAs were formulated in ‘84, the charges for customs clearance were fixed in ‘89. They have not been reworked since then, factoring in the increase in cost of all services including documentation, warehousing, transport and so on.
The Kelkar panel had pointed out cases of double billing by CHAs, where they maintained one set of books in accordance with the prescribed rates and on the other hand, charged their clients higher rates.