Why Import Export (IEC) Certificate
The reach of the products and services of India is not limited to the domestic boundaries but is now extended to international markets as well. Many strict rules and restrictions in foreign trade policies undergo relaxations to promote international trade practice and Globalization. This integration of the world economy will be possible with the help of imports and exports. But the cross-border trade is subjected to various procedures and sometimes various permissions. There are licenses and registrations that one must take before entering into the process of import and export.
An Importer-Exporter Code (IEC) is a significant business identification number that is mandatory for importing to India or exporting from India. Commonly it is also known as Import Export Code. It is a 10-digit code and has lifetime validity. However, it has to be renewed once in a year to continue being valid.
Requirement of IEC
- The importer needs IEC while clearing the shipment from the custom department.
- While transferring the funds to abroad the bank would need IEC.
- Custom port demands IEC when the exporter needs to send his shipment.
- When the billing amount received by exporters in foreign currency by the bank the IEC becomes mandatory.
It is to be noted that according to the latest circular issued by the government, IEC is not mandatory for all traders who are registered under GST. In all such cases, PAN of the trader shall be treated as a new IEC code for the purpose of import and export.
Also, Import Export Code (IEC) isn’t required to be taken in case the goods are exported or imported for personal purposes and aren’t used for any commercial purpose.
Benefits of IEC
- Growth in Business due to the global reach of the product and services of the business.
- IEC registration enables businessmen to take several benefits on import and export from the Directorate General of Foreign Trade (DGFT), export promotion councils and customs department, etc.
- There is no requirement of filing any return with DGFT and neither there is a need to do any extra efforts for renewal of IEC as it is a one-time registration.
- It is relatively easy to get the IEC code from the DGFT within a period of 10 to 15 days after submitting the application. Also, there is no need to provide proof of any export or import for getting the IEC.
Procedure to apply for IEC and Related Document
- The following documents are mandatory to apply for the IEC:
- Copy of PAN Card of Individual / Firm / Company.
- Individual’s voter id or Aadhar card or passport copy for identification proof.
- Cancelled cheque copy of current bank account.
- Copy of Rent Agreement or Electricity Bill Copy of the business premise.
- A self-addressed envelope for delivery of IEC certificate by registered post.
- After gathering the above documents, the person can follow the below procedure to get IEC:
- Visit the DGFT official website.
- Select the IEC management tab under the service tab on the home page.
- A new page will open showing the “apply for IEC”, the person then chooses this option subsequently the details filed will be verified by OTP.
- After registration on DGFT website and OTP verification the user will get a temporary password for login access.
- Further, users will fill out the application form (ANF 2A format), upload the required documents, pay the required fees and click on the ‘Submit and Generate IEC Certificate’ button.
- IEC code will be generated by the DGFT in prescribed time.
Author : Aditi
Date : 01-Sep-2022