The Importer Exporter Code (IEC) is a unique 10-digit code issued by the Director General of Foreign Trade (DGFT), Ministry of Commerce & Industry, Government of India. It is mandatory for any entity engaged in import and export activities in India to obtain this code.
The IEC Code is a key identification number for businesses involved in foreign trade. This code is used for various purposes such as:
- Importing goods into India
- Exporting goods from India
- Customs clearances
- Compliance with tax and regulatory authorities
- Banking transactions related to foreign trade
Valid for Lifetime:
An IEC is issued once and remains valid for the lifetime of the business. However, it is necessary to update or renew the IEC details periodically or when there is a change in the business entity’s structure (e.g., change of address, business name, etc.)
IEC Renewal / Updation
Mandatory Updates:
- Change in Business Details: If the business changes its name, address, or other crucial information, an update to the IEC is required.
- Changes in Directors or Partners: If the ownership or board of directors (in case of a company) or partners (in case of a partnership firm) changes, the IEC must be updated.
- Renewal of Bank Account Details: The IEC must also be updated if the business has changed its bank account details, as this information is linked to the IEC.
- Changes in Authorized Signatories: If the authorized signatory changes, the IEC needs to be updated with the new information
Annual Update:
While the IEC itself does not expire, the government encourages businesses to verify and update their details annually or as changes occur. The DGFT sends periodic reminders for the update, particularly regarding KYC (Know Your Customer) information. As per the Notifications issued in the year 2021, it was made mandatory by DGFT to all IEC holders to ensure that details in their IEC are updated electronically every year during April-June period.
Fees for IEC
- Fee for fresh IEC Application: The application fee for obtaining an IEC is INR 500.
- Fee for Changes: The IEC updating process itself does not incur any fee. However, if there is a change in the business entity’s details that requires re-issuance of a new IEC Certificate, then fees may apply which is also generally INR 500
Brief steps for online application / renewal of IEC:
- Visit the DGFT website http://dgft.gov.in and proceed with registration process in case of new application. Enter registration details, validate it with OTPs received on e-mail ID and mobile number provided
- Upon Successful validation of the OTP, a notification containing the temporary password will be received on the e-mail, password needs to be changed upon first login.
- Once logon to the DGFT portal using the user ID and password, in case of new registration click on “Apply for IEC”. Provide / check and validate the details (certain details will get auto-filled from MCA portal / Income Tax portal) like Name, Address, details of partners / directors etc. Attach necessary proofs wherever applicable like copy of PAN, copy of cheque, Address Proof etc.
- In case of existing IEC holders, for updation or renewal, post logon it is required to click on “Link the IEC”. Then verify the details, if there are any changes to be made update the changes and attach necessary proofs.
- Then check and submit the application
- Make payment of applicable application / renewal fees
- The application to be submitted either using Digital Signature or by validating through AADHAR OTP
- Once the application is successfully submitted, a confirmation is received on e-mail. The DGFT will verify the details and process the request. If there are no discrepancies, IEC will be updated in the system and intimated via email
Consequences of Non-Compliance with IEC Updation
- Suspension of IEC: If the IEC details are not updated, especially in case of a significant change such as a change in address, the DGFT may suspend the IEC. A suspended IEC means the business cannot engage in import or export activities
- Delays in Customs and Regulatory Approvals: An outdated IEC can prevent goods from clearing customs, leading to shipment delays and disruptions in trade operations. Importers and exporters may struggle to obtain necessary clearances from regulatory authorities.
- Legal Liabilities and Financial Penalties: Not updating IEC could also result in penalties or legal complications, particularly if the business is found non-compliant during audits or investigations by the DGFT or customs authorities
- Banking Transaction Challenges: Since the IEC is linked to the business’s bank account for foreign transactions, outdated details can cause issues with processing payments, receiving foreign remittances, and completing export-related banking transactions.
- Export and Import Restrictions: Any discrepancies in the business entity’s details can lead to restrictions on the export or import licenses issued under the IEC. If the IEC is outdated, businesses may be blacklisted from participating in international trade, making it impossible to perform essential functions like customs clearance or export documentation
The Importer Exporter Code (IEC) is a 10-digit unique identifier issued by DGFT, essential for businesses engaged in international trade. Though valid for a lifetime, periodic updates are required for changes in business details, directors, bank accounts, or authorized signatories. The update process is simple and can be done online via the DGFT portal. Non-compliance may lead to IEC suspension, customs delays, legal penalties, and banking issues, disrupting trade operations.