The government will allow the re-export of oil from foreign suppliers

Islamabad:

The federal government has announced plans to allow the import, local sale and re-export of petroleum products facilitated by foreign suppliers. This decision, aimed at streamlining trade procedures, includes amendments to the Customs Rules, 2001 by introducing the Customs Facilitation Rules, 2024.

The Federal Board of Revenue (FBR) has initiated amendments to the Customs Rules, 2001, incorporating the Customs Bond Facilitation Rules, 2024, according to documents available to The Express Tribune. Stakeholders are currently being consulted, and a 15-day window is being provided for views, suggestions and objections. Any submissions beyond this time frame will not be considered, with amended rules enforced by newspaper notification.

Under the proposed amendments, a new chapter, Chapter XLV, will be added to the Customs Rules, 2001, specifically aimed at international oil suppliers. These rules will allow petroleum products to be imported on behalf of foreign suppliers, subsequently sold in the domestic market and re-exported to other countries as directed by the government.

For this, foreign oil suppliers will have the option of setting up their own registered companies in Pakistan or operating through registered subsidiaries. Additionally, they may choose to import petroleum products through their subsidiaries, sourcing domestically and re-exporting from Pakistan. The proposed rules also outline provisions for international suppliers to keep stock in bonded warehouses across Pakistan, facilitating local sales or re-exports without formal exchange.

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If international oil suppliers choose to operate through a subsidiary registered in Pakistan, maintaining FBR registration and having a Pakistani bank account is mandatory. Additionally, a storage license from the Oil and Gas Regulatory Authority (OGRA) is required for those who wish to set up independent storage facilities in Pakistan.

To ensure compliance and safety, the proposed amendments require post-date checks to be provided as safeguards for the import, local sale and re-export of petroleum products. Evaluators will oversee the fulfillment of these obligations.

Published in The Express Tribune, February 9^u2024.

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