Importer Exporter Code Registration

Import Export Code (IEC) Registration - An Overview

Import-Export Code or IEC registration is mandatory for every person and organization engaged in importing and exporting activities from India. Such a 10-digit code issued by the Directorate General of Foreign Trade (DGFT) is necessitated for carrying out customs clearance, export benefits, and expansion in international markets.

If a firm is eligible, then an IEC can be made applicable by a proprietorship, partnership, LLP, or a company. The procedure includes submitting documents such as PAN card, Aadhar card, mobile number, email address, and other details required for registration. The whole procedure is online, ensuring there is no hitch in applying for the IEC.

Why is IEC Important for Businesses?

An IEC is very important for any company or business as it allows entry into international markets, makes customs clearance easier, ensures that all trade regulations are complied with, and brings business government export benefits. By simplifying such transactions, an IEC makes trade with other countries easier and enhances the possibilities of exporting.

Definition and Purpose of IEC

The Directorate General of Foreign Trade issues an import-export code, a 10-digit business identification number. Before one can attempt to start an import-export business in India, one must have an IEC. According to the current rules of India, no person can legally export or import products to or from India without having an IEC unless otherwise exempted.

Who Needs an IEC?

An Importer-Exporter Code (IEC) is important for anyone involved in international trade in India. Here's who needs one:

• Individuals: Anyone who wants to trade internationally, either for personal or business purposes, must get an IEC.
• Companies: All businesses, whether they are small startups or large firms, need an IEC to import and export goods.
• Organizations: This includes partnerships, trusts, and cooperatives that want to trade internationally.

Foreign Trade (Development and Regulation) Act, 1992

The Foreign Trade (Development and Regulation) Act, 1992 allows the Central Government to manage international trade. It makes the IEC mandatory for anyone wanting to import or export goods. This Act helps businesses follow the right trade rules and encourages more imports and exports.

Directorate General of Foreign Trade (DGFT)

The Directorate General of Foreign Trade (DGFT) is part of the Ministry of Commerce and Industry. It is responsible for giving businesses their IEC and managing trade policies. The DGFT also issues import licenses for restricted goods and ensures businesses follow the trade laws to improve their reputation globally.

Documents Required for IEC Registration

To get an Import Export Code (IEC) in India, you need to submit some key documents. This registration is a one-time process and doesn't require yearly filings, but it’s important to keep your information up to date.

Required Documents:

• PAN Card: A Permanent Account Number (PAN) card for the business or individual applying for the IEC.
• Identity Proof: This can be an Aadhaar card, passport, or voter ID.
• Address Proof: Documents like an electricity bill, rent agreement, or property papers can be used as address proof.
• Bank Certificate or Canceled Cheque: You’ll need a bank certificate confirming your account details or a canceled cheque with the business name.
• Digital Signature Certificate (DSC): If you are applying online, you may need a DSC for submitting the application.
• Passport-sized Photograph: A recent photograph of the applicant is required.
• Certificate of Incorporation or Partnership Deed: If you are a company or partnership, you need to provide these documents to prove the legal status of your business.
• One-Time Registration: The IEC is a one-time registration with no annual filings. However, it’s important to keep your information updated to avoid any issues.
• Bank Requirements: Banks often need the IEC when handling foreign currency transactions for imports and exports.
• Annual Updates: While not required, it’s a good idea to update your IEC yearly if anything changes. You can do this by logging into the IEC portal and submitting the updated details with your Digital Signature.

Updating IEC Details

When and How to Update IEC Information:

If your business information has changed, you will need to update your IEC. Login to the DGFT portal by typing in your ID, click on "Update IEC." This can be for a change in an address, bank details may have changed, or even what you actually do. The penalty for not updating IEC is that it becomes deactivated. DGFT requires periodic updates, especially in between April and June of every year.

Compliance with Foreign Trade Policy

To comply with India's Foreign Trade Policy (FTP), businesses must meet certain obligations to avoid penalties and ensure smooth international trade operations.

Common Issues Faced During Registration

Perhaps the most common dilemma in IEC registration is having to deal with the complex documentation requirements. The majority of companies struggle to arrange and submit all the documents including the PAN card, bank details, and address proof. Mistakes or lack of information often lead to verification problems and subsequent delays.

How to Overcome Application Rejections

Applications are normally rejected because of incomplete or incorrect information. How do you avoid application rejections?

• Carefully ensure the accuracy of any information you provide before making a submission.
• Ensure all attachments of the required documentations
• Check the status on the DGFT website and rectify any mistakes that might happen.