In this article, we will talk about legal policies and the procedure involves in import and export business in India. One advantage of the import-export business is that it helps you to widen your product or services offering to the global market.
If you are planning to start an import-export business in India then this guide is written for you. Here we will discuss the legal requirements for starting Import-export business. We understand that you have done enough research on what product and service you are going to import or export. We will discuss here legal challenges.
First and foremost, Like any other business activity, registration is required before starting a business of import or export, therefore we need to obtain a license from Govt of India for doing any import-export business transaction. This license for the import-export transactions is mandatory and generally known as Import -Export Code (IEC). IEC registration is required by a person for exporting or importing goods. Import Export Code (IEC) is mandatory for the Import-Export business as a Passport is mandatory for traveling abroad.
Import Export Code is a unique 10 digit number that is issued to any person or company by the Directorate General of Foreign Trade (DGFT), part of the Ministry of Commerce and Industry so that he may carry his Import Export business in India smoothly. DGFT has several regional offices, therefore you need to apply for the nearest regional or zonal office.
Business growth Taking your services or products to the international market will enlarge your businesses. IEC enables you to sell products outside India.
Export Subsidies - On the basis of IEC, companies or firms can benefits and subsidies their exports/ imports from DGFT, Customs, and export promotion council.
Lifetime validity - Once you are done with IE Code Registration and submit all the required documents, IE Code is issued for the lifetime of the entity and requires no renewal.
No Return Filing - IE Code does not require the filing of any return. Once, an IE Code is issued there are no further procedures required to maintain the validity of the IE Code.
Individuals can have IE Code - Even individuals who are proprietors of a business can obtain IE Code in their name. It is not necessary to incorporate a business entity for obtaining IE Code.