What is IEC Code Registration? Everything You Need to Know

In today's globalised economy, businesses are no longer limited to their geographical areas. Their operations are expanding globally with exports and imports. International trading is one of the most important components of business expansion and growth. However, to do so, they need to obtain an IEC Code Registration. 

But are you aware of the term import export code? Do you know how to register for the IEC? If not, this blog post is for you to provide all the necessary insights. You can also contact us for any further guidance.

What is an IEC Code? 

To know more about the IEC registration process, we must first know what it means. So, an Import-Export Code (IEC) is a unique 10-digit number, which is issued by the Directorate General of Foreign Trade (DGFT). It is done under the regulation of the government of India.

Its primary purpose is to monitor secure imports and exports of an economy. With an IEC code, businesses can unlock new market space to increase revenues. And contribute to economic growth. 

Who needs an IEC Code code and Why?

Every business that is engaged in international trade mandatorily needs an IEC code registration. It mainly includes importers, exporters, as well as service providers. But why is it so necessary?

An IEC code is needed for certain reasons, such as: 

Legal requirements: According to the Foreign Trade Act, 1992, it is mandatory to obtain an IEC code for any cross-border trade. It's illegal to do any deal without the registration.

International Trade: For all global trade dealings, an IEC is needed as a unique identifier of the businesses. 

Bank Transactions: Banks also require an IEC code for facilitating foreign exchange transactions. It helps them circulate foreign transactions very efficiently. 

What are the Benefits of IEC Code Registration? 

There are numerous benefits of getting IEC Code Registration. With the IEC code, Indian businesses can expand their customer base and revenue streams at international levels. The government also supports these businesses with different schemes and incentives. 

Unique Identifier: The import-export code serves as a unique identity number for businesses. It enables the differences of every other trader. It also helps in establishing trust and credibility in the marketplace.

Compliance with government: Once you obtain an IEC code, they can avoid penalties and fines as they are demonstrating their compliance with government regulations. 

Simplified custom clearance: Because of the IEC code, authorities clear goods that are in customs. It reduces the time and cost associated with imports and exports. Businesses can enjoy this simplified process because of the IEC code registration. 

Enhanced Credibility: Since the businesses are registered on the records, it enhances their credibility. This reflects trust in authorities, which leads to confidence among customers, suppliers, and potential partners.

Lifetime Validity: The IEC code is valid for a lifetime. It does require annual renewals. 

Easy Online Application: The registration process for the IEC code is entirely online. It makes the process very convenient and hassle-free to apply anytime. 

What is the Procedure for IEC Code Registration?

• Visit the DGFT website. 

• Then log in to apply for the IEC Code. 
• Fill out an application by submitting the required details, such as name, address, PAN, UID of business, etc. 
• Submit all the information of directors and partners, along with bank details. 
• Also, provide the particulars of the type of IEC code you're applying for and its reason. 
• Upload all the necessary documents and pay application fees.
• Apply by double-checking all the filled information. 

It would be further examined. You'll receive a receipt with a unique application number for tracking the status. After the approval of the application, you'll receive your unique IEC code via mail or post. Businesses can engage in international trade afterward. 

What are the documents required for IEC Code Registration?

• A copy of the business's PAN card and Aadhar Card.

• Business's certificate of incorporation.
• Business’s bank account details. 
• Address proof and digital signature certificate.
• Identity proof of directors and partners.
• A brief business profile including required details.

Some additional documents could be required as per the need. Ensure to keep them all updated. 

Common Mistakes to Avoid During IEC Application? 

Keep it noted that any minor mistake could lead to a delay or rejection of your application. Make sure to avoid these common mistakes for a successful application. 

1. Providing incomplete information. 
2. Providing incorrect PAN or Aadhar Number.
3. Insufficient or Invalid Documents.
4. Filling in incorrect bank details.
5. Failure in payment of the application. 

It's better to be fully conscious during the application process. Here are some tips to avoid these mistakes: 

1. Double-check all the filled information. 
2. Use a digital signature certificate. 
3. Keep all the documents ready and updated before the application process. 
4. Securely pay the fees online. 
5. Also, ensure to update the IEC code periodically. 

What happens after the IEC code approval?

After the IEC code approval, you can download your certificate from the DGFT website. It gets active immediately so that you can start your import-export dealings. Ensure to keep updating your IEC code details to remain valid and revised. Businesses can officially begin their global trade after getting approved. But make sure to comply with all the legal procedures with ethics. 

Frequently Asked Questions:

1. What is the cost of IEC registration?

It only requires a one-time payment of ₹500 for processing the application form. Some additional services may require extra fees, but it's going to be so worth it in return. 

2. What is the IEC cancellation process?

To cancel your IEC code registration, you'll have to file an application for cancellation. It requires some documents of the business. The authorities will further verify it to cancel the validity and issue a cancellation certificate. 

3. How to modify and update your IEC registration?

IEC code modifications could be done for certain reasons like changes in the name of the business, changes in ownership, changes in structure, etc. All you need to do is submit the modification certificate on the DGFT website. It will be modified and updated after the verification. 

Conclusion

To sum up, everything that has been stated so far, the IEC code is of utmost importance for businesses that are engaged in international imports and exports. Ensure to follow the guidelines and tips mentioned above, or you can contact JustStart for expert advice.