Import Export Code
With the passage of time, the number of businesses that want to break the barriers of local markets and venture into global markets is only increasing. However, carrying out a global business is not everyone’s cup of tea. In case you are a business owner who wishes to take your business into international waters, there are certain laws that must be adhered to and certain procedures that must be followed. Licensing and registration must also be done to carry out importing and exporting. The first requirement before you start an import/ export business in India is to obtain an IEC(Import Export Code). An IEC is necessary for import/export of goods. IEC(Import Export Code) is known as many names such as importer exporter code, import export code, import export license, import export number, etc. IE CODE NO. is a 10 digit code which is provided by DGFT(Directorate General of Foreign Trade) required for import export transactions. You can take IE code in your personal name or company name. An IEC number issued to applicant shall be valid for all its divisions/ units/ factories/ branches. IE Code registration is permanent registration which is valid for a lifetime. Hence, there will be no hassles for updating, filing and renewal of IE Code registration. It is valid until the business exists or the registration is revoked or surrendered. Further, unlike tax registrations like GST registration or PF registration, the importer or exporter does not require to file any filings or follow any other compliance requirement like annual filing.
As IE code registration is one-time and requires no additional compliance, it is recommended for all companies and LLPs to obtain IE code after incorporation.
IEC is required by importers to clear customs and shipment, and to transfer money to foreign banks. Exporters require IEC to send shipments and receive money from foreign banks. In short, no importer/exporter can operate in India without getting the IEC.
In case the import/export is of services or technology, IEC is required in only limited circumstances, when import/export is in ‘specified services’ or ‘specified technologies’, i.e. services or technologies in which international trade is restricted by the Government of India as they pertain to national security, such as dealing in nuclear weapons, automatic guns, etc.
Conditions in which IEC Code is required
The following are the situations in which importers and exporters will require the Import Export Code:
How to Apply for Import Export Code/IEC Registration
The application for registration is submitted on the Directorate General of Foreign Trade (DGFT) website by the applicant. The full information regarding the list of documents required is provided on the website. The following steps have to be fulfilled by the applicant for applying for IEC code.
Once all the above-mentioned steps are completed, the applicant shall receive an e- IEC certificate. And the import export license will be received within 15 days from the date of the application.
Documents Required for Import Export Code Registration
The Documents Required Are Relatively Less For Iec Registration. Only A Few Documents Are Required Which Are Listed Below For A Better Scope.
Benefits of Import Export Code Registration
IEC code helps to make goods and services of the individual or company, reach to the global market and this leads to the expansion and growth of the business.
The individuals or companies can obtain several benefits on their import or export of goods and services from the Directorate General of Foreign Trade (DGFT), Export Promotion Council, customs and etc on the grounds of their IEC Code registration.
One the IEC code is obtain there is no need to file any returns. It does not require following any sort of processes for upholding the validity of IEC code once obtained. There is no need to file any returns with the DGFT for export transactions.
Once the application is submitted for the registration of IEC code, it is quite easy to obtain it from the DGFT within a period of 10 to 15 days.
Once the IEC code is obtained, it is not required to renew the IEC code again and is effective for a lifetime of an entity and can be used by it against all the import and export transactions.
Any type of business registration: Sole Proprietorship, Partnership, Private Limited and Charitable organization dealing with the export and import of goods should register for Importer Exporter Goods.
Any type of business registration: sole proprietorship, partnership, private limited companies, charitable organizations dealing with import and exports of goods can register for import-export code, irrespective of the size. However, IE code is not required for Import/export of goods for personal use, which is not connected with trade, manufacture or agriculture. There is no need for a business set up.
Another step has been taken by the government of India for ease of doing business. Now, no IEC code shall be required for Import/Export, as decided by the government via notification.
As a result, the importer/exporters need NOT apply for separate IEC code for import/Export in India.Import Export Code (IEC) isn’t required to be taken in case the goods exported or imported is for personal purposes and isn’t used for any commercial purpose. Export/ Import done by the Government of India Departments and Ministries, Notified Charitable institutions need not require getting Import Export Code. As per the latest trade circular by the DGFT, the PAN shall be construed as new IEC code for the purpose of import and export and the DGFT department shall also issue the new IEC code as your PAN number only.