Import Export Code Registration: Process, fees, status of IEC in India

The journey of exporting goods from India dates back to colonial rule. During these times India became an exporter of raw materials and importer of finished goods. Since then, there have been drastic developments. As a result, today India is a leading exporter of engineered goods, jewelry, and electronic goods. All types of business models such as proprietorship firms, partnerships, Limited Liability Partnership, Private Limited Companies, Trusts, Societies, Hindu Undivided Families, etc. are allowed to conduct export and import business in India. With that said, this situation makes the market a bit scattered. In such situations, governmental registrations and licenses help the government stay up-to-date with industry developments and make compliance with the norms extremely easy to manage. Import Export Code Registration online is one such mandatory registration for all importers and exporters of goods from India. 

Through this Article, we will understand what exactly import export code registration means, the process of iec code application, fees, the importance of iec code, and how to check IEC status in India. 

Importer Exporter (IE) Code: Overview

Section 7 of the Foreign Trade (Development and Regulation) Act, 1992 makes it mandatory for each individual/business entity to have an importer-exporter code number to start an import-export business in India. The IEC is a unique 10-digit alphanumeric business identification number. It allows the government to ensure that the trade of illegal substances etc is eliminated. 

The IEC code application used to be an offline process. However, now with the new initiatives by the government towards making India go digital, the iec code registration process is available online on the DGFT (Director General of Foreign Trade) portal. 

The DGFT portal has an entire section dedicated to “Import Export Portfolio Management”, which allows people to conduct the following: 

• New users to apply for iec code registration; 
• Holders of offline iec to link iec number to DGFT (upgrade to e-iec); 
• Yearly renewal of iec code/iec update; 
• Surrender of IEC; 
• Print iec and download iec certificate; and 
• Lastly, it also allows you to check the status of an IEC code application. 

IEC Registration Process

Ever since the implementation of Goods and Services Tax (GST), all IEC issued is the same as the PAN of the firm. As stated above, the import-export code registration takes place online on the DGFT portal. It requires the verification of your details with the Permanent Account Number (PAN). Here’s a quick guide on how to apply for IEC code: 

• Step 1: Visit the DGFT Portal; 

• Step 2: Go to Services > IEC Portfolio Management > Apply for IEC;

• Step 3: Login/ Register as a User on the DGFT portal; 

• Step 4: Fill details in form ANF 2A (eIEC) > Submit Documents > Generate OTP; 

• Step 5: Payment of the Government Fees for IEC; 

• Step 6: Digitally Sign / Verify with Aadhar; 

• Step 7: Download IEC Certificate.

Also, check out our blog on Documents required for IEC Code Application. 

Timeline and Cost for import export code registration

The DGFT verifies all information during the import-export code registration process in real-time with the Income Tax Department. As a result, the timeline for the generation of the IEC certificate is one day! You can download the IEC certificate as soon as you make the payment and complete the Aadhar verification process. Do check out the steps to download and print iec certificate!

Whereas, the cost of iec code is as minimal as Rs. 500/-. You can complete the payment process online, through the various modes available on the DGFTT portal, such as – e-wallet, net banking, credit cards, debit cards, etc. 

Need for IEC code renewal

Before 2021, the IEC certificate once issued was valid for the entire lifetime of that business. However, this made staying up-to-date difficult for the DGFT and other stakeholders. As a result, IEC renewal was made mandatory through a notification issued in February 2021. According to this notice, all IEC number holders must renew their iec certificate each year between April to June. You can check out the step-by-step guide to update the IEC certificate in this blog IEC Code Renewal: how to update IEC? 

IEC code renewal is mandatory as it directly affects the status of your IEC application. If renewal is not done promptly, your iec status will change to ‘Deactivated’. Then, to ‘Activate’ your iec status, you will have to follow the steps for IEC code update. 

Steps to check IEC status

The DGFT has come up with a streamlined process to allow users to check IEC application status in the below mentioned two ways: 

1. A PAN-based verification, to check iec is registered with the DGFT; and 
2. Check IEC status to ensure iec has reached the ICEGATE portal. 

The following table shows different types of IEC status and the action required against it. 

Import Export Code Status	Action Required for IEC Status
IEC received at DGFT	4 days waiting period until application is processed
IEC application rejected	Resubmission required: make changes to iec application and resubmit it
IEC Status transmitted to ICEGATE	3 days waiting period: ICEGATE accepts IEC Code application
IEC status registered by DGFT and accepted by ICEGATE	IEC is ready to use!

 Benefits of Import Export Code Registration

Import-export code registration is not only mandatory for all foreign traders in India, but it also comes with a set of benefits. 

Allows Import and Export of goods: 

You are only allowed to move your goods past customers if you have a valid IEC certificate. Hence, all importers and exporters need import-export code registration to conduct their business. 

Helps in Business Expansion

While doing foreign trade, you introduce your business to new horizons. When you expose your business to global markets, the development opportunity increases by 100 times. Import-export code registration opens new windows to the global market. 

Easy online registration

The most advantageous factor of import-export code registration on the DGFT portal is the ease of doing the entire process online, in just a few clicks. Not only the application process, but all actions related to IEC certificates are available online. 

Additional assistance from the DGFT 

All IEC holders can access various schemes and initiatives taken by DGFT to help importers and exporters in scaling their businesses. For example the Merchandise Exports from India Scheme (MEIS) and Service Exports from India Scheme (SEIS). The government also provides many subsidies to motivate exports from India. 

Tax benefit for exporters

All exporters having the IEC and Letter of Undertaking under the GST, are exempted from paying the Tax on export of goods. 

Conclusion

Import-export businesses in India are thriving, especially in the industries of engineering goods, gems, precious stones, refined oils, etc. All these industries need the utmost care and attention. Hence, while dealing in such an industry, you will need a lot of expert advice to run a successful business. LegalWiz.in can be your one-stop solution for all governmental registrations and licenses! Connect with us today!