Import/Export Code (IEC)

Introduction

Businesses that import or export goods or services are granted a ten-digit alphanumeric designation known as the Import Export designation (IEC). Importing and exporting is prohibited for any company without the Import and Export Code. Tax officials like Customs and DGFT personnel utilize the IEC, which is issued by the regional office of the Director General of Foreign Trade (DGFT), to uniquely identify import and export enterprises throughout India. In addition, the Indian economy's financial stability is guaranteed by the DGFT, which employs the IEC code to control the importing and exporting activities of Indian companies.

What is IEC

An essential company identifying number required for imports into or exports from India is the Importer-Exporter Code (IEC). Unless otherwise exempt, no person may export or import without first obtaining an IEC. However, IEC will not be required for services exports unless the service provider is benefiting from the Foreign Trade Policy.

IECs are issued in accordance with the PAN of the company, as a result of the implementation of GST. DGFT will still issue the IEC individually based on an application, nevertheless. Any of the following business structures may be used to get an IEC: proprietorship, partnerships, limited companies, trusts, HUFs, and societies.

When IEC Required

• The customs officials require it when an importer has to clear his shipments from customs. 
• The bank needs the money that an importer sends overseas via banks. 
• The customs port requires shipments that exporters are required to send. 
• The bank requires it when an exporter receives foreign currency immediately into his bank account.

Where IEC is not Mandatory

 The government's most recent circular states that not all traders who are registered under GST are required to have an IEC. For import and export purposes, the trader's PAN will be interpreted as a new IEC code in all such circumstances. If the products are being imported or exported for personal use only and are not being used for business purposes, there is no need to get an Import Export Code (IEC). Obtaining an import export code is not necessary for export/import operations carried out by Departments, Ministries, and notified charitable organizations of the Government of India.

Benefit of IEC Registration

All companies engaged in international trade are required to complete the straightforward process of registering their import export codes. In order to enable import-export companies to benefit from a range of initiatives designed to support their expansion and prosperity, the Indian government has made IEC registration essential. The following is a summary of some significant benefits of IEC registration for import/export companies:

1. Easy of Business Registration:

Businesses that are registered or unregistered must apply for an IEC via the DGFT website. In ten to fifteen working days, an IEC is granted if all of the provided documents are confirmed.

2. No Return Filing:

No returns are required to be filed with IEC. Once granted, it is not necessary to adhere to any kind of procedure in order to maintain its legality. Filing any returns with DGFT is not required, not even for export transactions.

3. Global Transaction Ease

Getting an IEC simplifies and legalises all of your cross-border dealings. This code also identifies you as a verified importer/exporter. It lessens the smuggling of products across international borders.

4. Business Expansion:

IEC helps you expand your companies by bringing your goods or services to a worldwide consumer base.

5. Lifetime Validity:

IEC code does not need to be renewed and is valid for the duration of an entity. An entity may utilize it against any export and import transaction after it has been received.