What Is an IEC (Importer-Exporter Code)? Key to Starting Import-Export in India

Have you been thinking about starting your own import or export business in India? Do you feel unsure about how to start or what license is required to trade goods across borders? If yes, then the first thing you will need is an IEC (Importer-Exporter Code).

It is not difficult to obtain an IEC and can be completed fully online. In this blog, we will explain what an IEC is, who needs it, how to apply, and how it helps your business grow globally.

What is an Import Export Code?

IEC (Importer Exporter Code) is a 10-digit number given by the Directorate General of Foreign Trade (DGFT), which works under the Ministry of Commerce and Industry in India. This code is needed for anyone who wants to import goods into India or export goods to other countries.

The IEC is based on your Permanent Account Number (PAN), whether you are an individual, a company, or a partnership. The code helps identify your business when dealing with customs officers, banks, and shipping agents.

Once issued, the IEC is valid for life and does not require any renewal. However, from 2021 onward, the DGFT made it mandatory to update or confirm IEC details once every year, even if no changes have been made.

The Role of IEC in Indian Business

IEC is essential for establishing and operating a lawful import-export business in India. Here are some key roles it performs:

• Clearance of Customs: In the absence of an IEC, customs will decline shipments entering or exiting the country.
• Banking: Banks ask for your IEC while making export/import goods payments.
• Government Schemes: The majority of export benefit schemes administered by the DGFT, MEIS, and SEIS require an active IEC to receive incentives or duty credits.
• Business Identity: IEC works like a unique identifier that enables foreign buyers as well as Indian customs to identify your business easily.

So, having an IEC (Importer-Exporter Code) is the first step if you want to take your business into the international market.

Who Needs an IEC Code?

IEC is required by anyone involved in the import or export of goods from India. Whether you are:

• An individual person
• A company (private or public)
• A partnership firm
• A trust
• A limited liability partnership (LLP)
• Or a Hindu Undivided Family (HUF)

You need an IEC if you plan to import or export products across Indian borders for business purposes. There are a few cases where IEC is not required. These include:

• Goods imported/exported for personal use, not for business.
• Government departments
• Foreign embassies
• Traders dealing with Nepal or Myanmar through land routes have a value of ₹25,000.
• Export of services without any benefits under the Foreign Trade Policy

If you are exporting services like freelancing, web development, or consulting without claiming government benefits, you might not need an IEC.

Documents Required for IEC Registration

To apply online for IEC, you would require the following documents:

• PAN Card of the business or individual
• Identify proof such as Aadhaar card, voter ID, or Passport (for individuals or directors)
• Provide proof of the business address, such as a utility bill, rental agreement, or property papers.
• Cancelled Cheque or Bank Certificate, to prove your business account exists.
• Digital Photograph of the applicant (passport-size photo)
• Certificate of Incorporation or Partnership Deed, if the business is not a sole proprietorship.

All documents should be clear and match the name and address used in the IEC application.

How to Apply for IEC Registration Online

The Indian government has simplified the application process for IEC through the online DGFT portal. Follow these steps:

1. Visit the DGFT Website and register using your PAN and basic details.

2. Log in using your credentials and then click on “Apply for IEC”.

3. Add business details, PAN information, address, bank details, and upload the required documents.

4. The IEC application costs ₹500. Payment can be made through internet banking, UPI, or card.

5. You can use your Aadhaar number to verify the application with a one-time password (OTP).

6. Companies may need to use a Digital Signature Certificate (DSC).

7. Once submitted, the IEC will be sent to your registered email within 1-3 business days.

The process is entirely online and does not require any physical visit to any office.

Advantages of IEC Registration

Having an IEC offers many benefits:

• Start Global Trade: You can now import and export products legally and operate your overseas business.
• Open Foreign Bank Accounts: Banks will request your IEC while opening foreign trade transactions.
• Export Benefits Claim: You can avail of duty concessions, tax remissions, and other initiatives of India’s Foreign Trade Policy.
• Smooth Custom Clearance: IEC facilitates easy customs clearance, as everybody knows this code.
• No Returns: After you get the IEC, you are not required to submit monthly or annual returns.
• Lifetime Validity: The code never expires. You need to authenticate or renew once a year.

Be it garments, edibles, electronics, or handicraft products, IEC facilitates your smooth trading across borders.

How to Cancel IEC?

If you stop doing import-export business and no longer need the IEC, you can cancel it through the DGFT portal.

Steps to Cancel IEC:

1. Log in to your account on the DGFT website.

2. Select “Surrender IEC” from the dashboard.

3. Fill in the required reason and attach supporting documents.

4. Submit the application.

5. Once the DGFT processes your request, your IEC will be deactivated. You will receive confirmation through email.

It is important to cancel the IEC if the business is shut down to avoid misuse or future issues with customs.

To Conclude

If you are intending to export or import Indian goods, then the initial legal process is obtaining an IEC (Importer-Exporter Code). It will make customs dealings, bank dealings, and securing trade benefits very convenient. It is a straightforward online process.

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