International trade can open endless avenues for business in India and lead to market exposure that will result in exceptional growth. However, doing this once requires compliance with specific regulations; one of the most important is obtaining an IEC (importer – exporter code). Whether you intend to import goods, export products, or diversify your business internationally, an IEC is the norm once you are looking to enter international trade.
What Is an Importer Exporter Code?
IEC (importer – exporter code) is a 10-digit business identification number issued by the Directorate General of Foreign Trade under the Ministry of Commerce. Such a unique code is an essential requirement for any business that imports and exports goods in India. No person or entity can carry out such activities without obtaining an IEC unless exempted.
IEC is made mandatory for:
- Custom clearance of imported goods.
- International payments to foreign banks.
- Export shipments and receipts of overseas payments.
- For service export-oriented firms, IEC is not required unless some benefits under the Foreign Trade Policy are taken.
Why Does Your Business Need IEC?
To import and export across the world, an Importer Exporter Code or IEC is indispensable. Here’s why:
1. Opens International Markets
IEC serves as a passport for businesses, granting access to international markets. Whether you’re exporting Indian handicrafts or importing raw materials, IEC is indispensable for smooth operations.
2. Simplified Documentation
The IEC registration process is straightforward and requires minimal documentation. Businesses can now apply online through the DGFT portal, ensuring a hassle-free experience.
3. Lifetime Validity
Once issued, IEC is effective until the lifetime of the concern. There are no renewals or periodic filings required; it is a one-time investment for long-term advantages.
4. Curbs Illicit Trade
As IEC registration insists on verified information, it reduces the potentiality of illegal transportation of goods. Such transparency ensures international trade norms are obeyed.
5. Vouches for Government Facilities
Eligible importers and exporters benefit in various ways, including taxes exempted under GST, subsidies issued by Export Promotion Councils, and recovery of duties on exported merchandise.
Who is Eligible to Obtain IEC?
Any business organization in India can get an IEC (importer – exporter code), regardless of their size or any other parameters. The entities eligible for obtaining IEC are:
- Proprietary Firms
- Partnership Firms
- LLPs – Limited Liability Partnerships
- Private Limited Companies
- Trusts
- Societies
- Hindu Undivided Families (HUFs)
The process of application must ensure an active PAN, a registered address, and a bank account in the business’s name.
Required documents for IEC Registration
To get an Importer Exporter Code, the business should submit all the following documents:
Proof of Establishment/Registration:
- Partnership Deed (for partnerships)
- Incorporation Certificate (for companies)
- Trust Deed (for trusts)
- Address Proof:
Sale Deed
- Rent Agreement
- Utility Bills (Electricity, Telephone, etc.)
- In case the premises are on rent, an NOC from the owner is required.
Bank Account Proof
- Cancelled Cheque
- Bank Certificate
- Digital Signature Certificate (DSC):
- For submission of applications on the DGFT portal.
How to Obtain an IEC Registration?
The entire IEC application process is online, thereby saving time and hassle. This is what one has to do:
- Register with the DGFT Portal:
- By business details, generate a login ID.
- Keep scanned copies of all the documents which must be according to the specification provided by DGFT.
Submit Application
Online form may be submitted along with attaching the requisite documents. The payment must be done on the portal.
Verification and Approval
Upon satisfying the given details by the applicant, DGFT processes the application and sanctions it to the applicant.
Issue of IEC Certificate
Applicant will get an e-mail with his IEC Certification.
Advantages of IEC Registration
Business Facilitation
IEC companies can import and export easily without messy procedures. It simplifies transactions while maintaining international norms.
No Renewals Required
IEC is valid for a lifetime and has no requirement of renewal or updation.
Compliance with Trade Policies
The IEC complies with India’s Foreign Trade Policy thus reduces legal risks, and enhances credibility in the international markets
Tax Benefits
Availing Tax exemption and claims under GST framework, the profitability increases.
Smoothening the Export Process with IEC
Obtaining an IEC (importer – exporter code), is a mandatory process for any organisation planning to venture into international trade. It just simplifies the process, ensures compliance, and unlocks countless opportunities in the global marketplace. Exporting can be even more straightforward as IEC allows Indian businesses to grow globally through its robust ecommerce export program. From online registration to logistics management, it gives you all the tools you need to scale up your operations. So, what are you waiting for? Get started today and take your business to the next level of selling.
