Is IEC mandatory for my small business?

IEC stands for Import Export Code is necessary for a company or any individual who has the vision to increase the reach of their small businesses worldwide. In India, IEC Registration is controlled, and IEC is issued by the office of DGFT (Director-General of Foreign Trade), Ministry of Commerce for Import and Export businesses in India. Simple it means if you want to start a small business in India, then you have to get the IEC code. At the time of clearing the consignment, the customs authorities may ask for Import Export Code, that's why all the entities need to get IEC number for import and export of products and services all around the world. Scroll down to check more information regarding IEC Registration in India.

Following are some Do’s and Don'ts in IEC Registration:

• Don’t apply for IEC more than one against single PAN Number.
• After completing the IEC Registration, a user cannot change his/her registered mobile number or PAN or E-mail Id.
• An applicant can fill the form online and save in a partially completed, and later, the applicant can continue and complete the full IEC application form.
• Keep The ECOM reference number in handy for future reference.
• Before applying for IEC, do check for exemption, some businesses in India doesn’t require any Import Export Code (IEC).
• The applicant can re-apply against a rejected form.
• Learn about the scope of market access.
• In the online form of IEC always provide the correct information; otherwise, the applicants can be penalized, and legal action can be taken against him for giving incorrect data.
• It always better to check the product’s quality in another market before applying for IEC.
• At the time of application process, an applicant can delete, re-upload and view the uploaded documents.
• There is a modification facility available at the DGFT website on the online payment of Rs. 200/-.

1. Following is the list of some essential documents required for small businesses under the Proprietorship for IEC Registration:

• PAN card.
• Aadhar card/Voter ID/Driving License/Passport.
• If the business is self-owned, then submit a copy of Sale Deed.
• If the business is rented, then submit a rent agreement or lease agreement.

1. Following is the list of documents for small businesses under the Partnership category:

• Submit a Bank statement or cancelled cheque.
• If the business is self-owned, then submit a copy of Sale Deed.
• Copy of Partnership Deed.
• Submit PAN/Passport/UID/ Voter ID card/Driving License of the managing partner.
• Submit Aadhar card or Voter Id or passport, etc. of the owner of the business.

1. Following is the list of documents required for small businesses under LLP (Limited Liability Partnership):

• Digital photograph of the LLP's Designated Partner or Company's Director, who is signing the application.
• Submit a copy of the Applicant's PAN card.
• A copy of Voter ID, Managing Partner’s Passport, Driving License, and UID of the Managing Director.
• Submit a copy of the sale deed if the business is self-owned.
• Copy of rent agreement or lease deed (in case the business is rented).
• Cancelled cheque or Bank Certificate as per ANF 2A. 

On 13^th July 2020, DGFT has introduced a new and updated way to apply IEC Online. DGFT (Director-General of Foreign Trade) decided to launch a digital platform to publish IEC code. Requirements of DSC have been announced by the Director-General of Foreign Trade (DGFT) to reinforce the IEC issuance procedure and to stop fraud.

The online procedure for IEC Registration are as follows:

Step 1: First, go to the official portal DGFT, i.e., https://dgft.gov.in/CP/. Then the home page of DGFT will open.

Step 2: Then Click on the “Apply for IEC” button.

Step 3: Then, you need to enter all the registration details such as Register User, First Name & Last Name, and Email ID & Mobile number of the applicant, District, Pin code, State, and City.

Step 4: After filling all the details for registration, click on the "Send OTP," and then you'll receive an OTP on email id and mobile number. After this, go to the website's main page and click again "Apply IEC" button and log in by using your login credential.Step 5: After login, you can fill all the details mentioned in the IEC registration form
Step 6: After this, you need to fill the Director / Partner / Karta / Proprietor / Managing Trustee of the Entity.

Step 7: Then, enter all the details of the Bank of the Entity like Account holder's name, Bank and Branch Name, Account Number, IFSC Code, and also you need to upload a cancelled cheque book and click on the “Save and Next” button.

Step 8: Now, you need to select other details (Preferred sectors of operations) and then select the Acceptance of Undertaking/Declaration and fill the place. After that, click on the "Save and Next" button for further procedure.

Step 9: After the above step, click on the "Sign" button at the lower part of the page.

Then you need to select one of the methods for submitting the form, i.e., either through DSC (Digital Signature Certificate) or Aadhar OTP. After submitting the form and signing the prescribed form, proceed further to make the payments against the application. For payment, you need to pay Rs. 500/- for IEC Registration form. After the successful payment, the page will be redirected to the DGFT website, and you can download the receipt for any future reference.

Users can also download the IEC Certificate from "Print Certificate" feature in "Managing IEC."

The Government of India has released a circular where it is mentioned that IEC Registration is not compulsory for all the traders who already completed GST Registration or registered under GST (Goods and Services Tax). IEC is not required in case of the goods imported or exported for commercial purposes or any personal purposes. The whole process of Import or export in India is done and controlled by the Ministries and Departments of Indian Government and any charitable organizations in India does not require IEC.

Small Businesses in India can get various opportunities by obtaining IEC and extend their business around the world. Without IEC registration, importers and exporters merchant cannot avail any benefits from DGFT for the import-export scheme.