The union ministry of commerce and industry, on 12th January 2021 announced that the New Foreig...
Today everyone desires to grow and expand their business globally. However, it may not be as easy as you would think. It requires going through several procedure and laws and obtaining different registration and licenses. Import Export Code Registration is one such registration required for importing or exporting from India. In this article, we shall have a detailed look at IEC registration for small businesses.
IEC is required by persons looking to commence their import/export business. This code is issued by Director General of Foreign Trade. It is a 10 digit code having lifetime validity. Predominantly importers merchant can’t import goods without having an IEC, and exporter merchant can’t avail benefits from DGFT for the export scheme etc., without IEC.
The IEC is required when:
The following are the steps to obtain IEC Registration:
Firstly, you must prepare an application form in the specified format- Aayaat Niryaat Form ANF- 2A and file it with the respective DGFT regional office.
Thereafter you should prepare the documents required with respect to your identity and legal entity and address proof with your bank details and the certificate in respect of Form ANF 2A.
Once the application is finished and filled up, you should file it with the DGFT through DSC and pay the fee for obtaining the registration.
Finally, when your application is approved, then you will receive the IEC in a soft copy from the government.
While filing the application form, you will have to submit certain documents such as:
The following benefits can be enjoyed:
Having an IEC helps you to take your products or services to the global level and thus expand your business.
Companies can avail numerous benefits of their import/export from the Director General of Foreign Trade, Export Promotion Council, customs etc., based on their IEC registration.
IEC doesn’t require filing of any returns. Once allotted, you don’t have to follow any kind of processes for sustaining its validity. Even in case of export transactions, there is no need to file any returns with the DGFT.
It involves an easy process to get the IEC code from the DGFT within 10 to 15 days after the submission of the application. There is no need to give any proof of any export or import for obtaining this code.
IEC is effective for the lifetime of an entity thus doesn’t need to be renewed. Once it’s obtained, it can be used by an entity against all export and import transactions.
As per the latest notification from the government, IEC is not compulsory for traders who are registered under GST. In all such cases, the PAN of the trader will be construed as the new IEC for the import and export purpose. This code is not required to be obtained in case the goods exported or imported is for personal purposes and not for any commercial purpose. Further, export or import done by the Government of India departments, ministries, notified Charitable institutions etc., don’t have to get the IEC.
An individual who engages in importing and exporting goods for individual purposes and not related to trade, manufacturing and horticulture are exempted from getting this registration. Moreover, people who wish to export or import products from Nepal and Myanmar through China and Indo-Myanmar fringe zones with a transfer that doesn’t exceed 25k rupees doesn’t need the registration.
Hence it’s clear that an IEC registration can unlock growth opportunities for an individual. Therefore if you desire to expand your business internationally by dealing with the imports and exports business, consider applying for the IEC today.
Read our article: DGFT introduces E-tariff rate quota (TRQ) system for imports