Why is an Import Export License Mandatory?
In today’s globalised economy, cross-border trade has become an integral part of business growth. India’s import and export sector plays a significant role in boosting the national economy, creating employment, and connecting Indian entrepreneurs with international markets. However, before entering the world of global trade, every business must ensure compliance with import export regulations in India. One of the most crucial requirements is obtaining an Import Export License, also known as the Import Export Code (IEC).
The IEC Code is a 10-digit number issued by the Director General of Foreign Trade (DGFT) India, which acts as the business identity for importers and exporters. Without this code, no business can import or export goods or services legally in India. In this blog, Trusted Company Registration Consultants in Pune – Startup Portal Business Services explains why the IEC license is mandatory, how to apply for it, and what benefits it brings for your business.
What is an Import Export License (IEC)?
The Import Export Code (IEC), sometimes referred to as the Importer Exporter License or Import Export Certificate, is a unique 10-digit code that enables businesses to carry out international trade.
Issued by DGFT India: The IEC Code DGFT is issued by the Directorate General of Foreign Trade (DGFT) under the Ministry of Commerce and Industry, Government of India.
Key Features of IEC License
- 10-digit unique code valid for lifetime.
- No renewal required, making it a one-time registration.
- Can be obtained by individuals, companies, or LLPs.
- Essential for customs clearance, foreign currency transactions, and claiming DGFT incentives.
In simple terms, IEC registration in Pune is the first step toward starting an international business.
Why IEC License is Mandatory
The IEC license is not optional—it’s a legal requirement under India’s Foreign Trade Policy. Here’s why obtaining an IEC is mandatory for every importer and exporter:
1. Legal Requirement for All Imports and Exports: According to DGFT India, no person can import or export goods or services without obtaining an IEC number. It acts as your business identity during foreign trade transactions.
2. Required for Customs Clearance: When you import or export goods, customs authorities demand an IEC certificate for clearance. Without this, shipments may get delayed or seized.
3. Enables Foreign Currency Transactions: Banks require a valid Importer Exporter Code for processing international payments, both inward and outward.
4. Access to Government Benefits: Businesses with a valid IEC code can avail export promotion schemes, duty drawback, and DGFT benefits under India’s Foreign Trade Policy.
Situations Where IEC is Required
The Import Export Code is mandatory in several trade-related situations:
- Customs Clearance: Required to import or export goods through ports or airports.
- Foreign Payments: Needed to send or receive foreign currency through banks.
- Availing Government Incentives: Necessary for DGFT or Export Promotion Council (EPC) benefits.
- Global Business Operations: Required for shipping goods internationally or sourcing raw materials from abroad.
Steps to Apply for IEC License
Applying for an Import Export License in India is simple and can be done entirely online through the DGFT portal. Here’s how to get started:
Step-by-Step IEC Registration Process
- Visit DGFT Website: Go to https://www.dgft.gov.in
- IEC Profile Management: Click on ‘Apply for IEC’.
- Register and Verify OTP: Enter mobile and email for verification.
- Login and Fill Details: Add business details, bank account, and branch information.
- Attach Documents: Upload PAN card, address proof, and bank details.
- Attach DSC and Pay Fees: Use your Digital Signature Certificate (DSC) and pay the prescribed fee online.
- Receive IEC Certificate: You’ll receive the IEC certificate via registered email within 10–15 working days.
Documents Required for IEC Application
To apply for IEC code, you’ll need the following documents:
- PAN Card of the individual or business entity.
- Address Proof (Voter ID, Aadhaar, Passport, or Utility Bill).
- Business Establishment Proof (Sale deed, rent agreement, or electricity bill).
- Bank Account Details (Cancelled cheque or bank certificate).
- Digital Signature Certificate (DSC) for online verification.
- Active Email and Mobile Number for OTP verification.
- All documents should be clear and valid for smooth processing.
Benefits of IEC License
The Import Export Code offers numerous advantages to businesses:
1. Global Business Expansion: With an Import Export License, businesses can access global markets and connect with international clients and suppliers.
2. Avail Government Benefits: Holders of IEC certificates can avail various DGFT schemes, MEIS (Merchandise Exports from India Scheme), and SEIS (Service Exports from India Scheme) benefits.
3. No Return Filing Requirement: Unlike GST or Income Tax registrations, the IEC license does not require filing periodic returns.
4. Lifetime Validity: Once obtained, the IEC remains valid for a lifetime unless cancelled or surrendered.
5. Easy Application Process: You can apply IEC code online easily through the DGFT portal and receive it in less than two weeks.
Cases Where IEC is Not Mandatory
While IEC is generally mandatory, certain cases are exempt:
- Traders Registered under GST: Their PAN acts as IEC, as per DGFT notification.
- Personal Use Imports/Exports: Not required for goods imported or exported for personal use.
- Government Departments and Charitable Institutions: Exempt from IEC registration for non-commercial purposes.
Conclusion
The Import Export License (IEC) is not just a registration — it’s a gateway to international business opportunities. It ensures legal compliance, facilitates smooth customs clearance, enables foreign payments, and provides access to DGFT benefits and government incentives. With simple documentation and online registration, obtaining an IEC certificate has never been easier. Whether you’re a startup, SME, or established company, having an Import Export Code helps your business grow globally and stay compliant with India’s Foreign Trade Policy.
At Startup Portal Business Services, we simplify the entire IEC registration process. From documentation to DGFT filing and IEC verification, our experts ensure fast, error-free registration so you can focus on expanding your business across borders. Apply for your IEC License today with Startup Portal Business Services – your trusted partner for Import Export License India, IEC registration online, and DGFT compliance services.