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Import/Export Licence (IEC Certificate)

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Import/Export Licence (IEC Certificate)

In this day and age of cutthroat competition, everyone wants to expand their business beyond the confines of the domestic market. However, doing business on a global scale is not for everyone. Before going global, you must follow several procedures and laws in place, as well as obtain various registration and licenses. When considering importing or exporting from India, one of the prerequisites is an IEC (Import Export Code) license. It is also referred to as the Importer-Exporter Code.

Anyone looking to start an import/export business in the country must obtain an IEC (Import Export Code). The DGFT is in charge of issuing it (Director General of Foreign Trade). IEC is a 10-digit code that is valid for a lifetime. Generally, importers cannot import goods without the Import Export Code, and exporters cannot benefit from the DGFT for the export scheme, etc. without the IEC.

Advantage of IEC Registration

The DGFT, Export Promotion Council, Customs, and others could provide incentives for the companies' imports and exports based on their IEC registration. There are a few additional advantages listed below.

  • IEC can help you take your services or products to a global market and grow your business.
  • On the basis of their IEC registration, the companies could receive several benefits for their imports/exports from the DGFT, Export Promotion Council, Customs, and so on.
  • It is relatively simple to obtain an IEC code from the DGFT within 10 to 15 days of submitting an application. There is no requirement to provide proof of any export or import in order to obtain an IEC code.
  • IEC code is valid for the life of an entity and does not need to be renewed. After obtaining it, an entity could apply it to all export and import transactions.

Situations Where IEC Is Required

Getting an IEC registration for import and export business and commercial purposes is critical. IEC does not need to import or export goods for personal consumption. The areas where IEC is necessary are listed below.

  • The customs authorities require it when an importer has to clear his shipments through customs.
  • When an importer sends money abroad through a bank, the bank requires it.
  • When an exporter needs to send his shipments, the customs port requires it.
  • The bank requires it when an exporter receives money in foreign currency directly into his bank account.

Situations Where IEC Is Not Required

According to the most recent government circular, IEC is not required for all GST-registered traders. In all such cases, the trader's PAN will be interpreted as a new IEC code for the purposes of import and export. Import Export Code (IEC) is not required if the goods exported or imported are for personal use only and are not used for commercial purposes. Import/Export done by Government of India Departments and Ministries, as well as Notified Charitable Institutions, do not require an Import Export Code.

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