Director-General of Foreign Trade (DGFT) recently issued a notification alarming to all the IEC (Import Export Code) users to confirm their details of IEC to the department whether if there is any up-gradation in the IEC required or not. It has been also notified that this requirement will become annual compliance from 1st April 2021 and each holder of IEC will need to ensure to update its IEC every year between April to June. If such compliance is not met, the IEC shall be deactivated.
As stated through the official notification, DGFT updated rules regarding the up-gradation of IEC details as provided under Chapter 1 and Chapter 2 of the Foreign Trade Policy, 2015-2020.
What is IEC?
Import Export Code is a license issued by the Department General of Foreign Trade to all those entities which are involved in the business of exporting or importing goods. An importer or an exporter must hold to avail tax subsidies, to avail policy schemes of the government, and to transact across borders.
IEC can be applied on the official web portal of DGFT, which through submission of an application online can be availed at any time.
The Amendments so proposed include:
- Compulsory holding of IEC for import and export to/from India
- IEC will now also be available through digital means and applications for e-IEC can be made online https://www.dgft.gov.in.
- The IEC shall have to be electronically upgraded every year. In case no changes are to be made, the same details of the code have also to be confirmed annually.
- IEC if not upgraded annually on the notified portal, shall face de-activation.
- The new system can also flag any IEC for scrutiny. Once scrutiny is initiated it need to be obliged, else in such cases also non-compliance would result in deactivation.
How to Update IEC Online?
IEC can be updated online by logging in to the user credentials generated at the DGFT portal located at https://www.dgft.gov.in.
Why such compliance?
The IEC is used for a vast number of purposes like custom clearances, foreign exchange management, availing subsidized schemes, availing policy benefits of governments, etc, Hence such compliance was mandated to ensure that users of IEC use the license in good faith and department have all necessary details required to make time-bound scrutinizes of the user.
Need consultation on export compliances?
Email us your queries at firstname.lastname@example.org