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IEC Registration

Priyanka Bajpayee
| Updated: 28 May, 2022 | Category: IEC

IEC Deactivation by DGFT and how to avoid it?

IEC Deactivation
Reading Time: 3 minutes

For each business to successfully transact import or export transactions, you need to comply with specific rules and laws. An Import Export Code (IEC Number) license is a requirement that a business must fulfil for importing or exporting business in India. It is also called the Importer-Exporter Code. In this article, we will discuss IEC Deactivation by DGFT and how to avoid it?

What is the IEC Code?

IEC stands for Import-Export Code, a 10-digit code that an individual or a business needs to import or export goods or services. The IEC code is allotted by the DGFT (Director General of Foreign Trade), Ministry of Commerce and Industries, and the Government of India.

After submitting all the requisite documents, generating the IEC code takes 12-15 working days. In India, an IEC is mandatory for every commercial importer or exporter. Hence, the business not having Import Export Code is not qualified to undertake the category of import and export.

Note: The validity period of this Import Export code is for a lifetime, which means that the IEC holder need not apply for IEC Renewal. A company having IEC can perform all requirements concerning import-export and related issues.

How do I register Import Export Codes (IEC)?

All Indian exporters and importers must comply with the Foreign Trade Policy’s Import Export Code (IEC). Therefore, the below-mentioned steps have been used to categorize all registration steps.

  1. Apply for DSC: IEC registration is entirely online. Therefore, a DSC must be used to sign the application.
  2. Fill Online Application and Upload DocumentTo avoid any mistakes, applicants must complete the application online. An application rejected for any reason will be made if there is a slight error.
  3. Upload and follow up- After your application has been filed correctly and submitted, you will need to follow up if IEC is delayed.

IEC Deactivation by DGFT

With reference to Notification No. 58/2015-2021 dated 12.02.2021, 11/2015-2021 dated 01.07.2021, 16/2015-2021, a notification was issued by DGFT to all IEC holders, requiring them to ensure that their Import and Export Code details are updated each year electronically during the period of April-June (and for which they were not required to pay any user fees). Based on the representations of IEC holders who hadn’t updated their IECs, it was extended to 31.07.2021. After that, it extended to 31.08.2021.

Before the phase-wise deactivation, due intimations were also given via Trade Notice 18/2021-2022 dated 20,09.2021 and Trade Notice 26/2021-22 dated 19.11.2021.

The third phase of deactivation for IEC that have not been updated and the Trade Notices and the notification mentioned above is initiated where All Import and Export Codes have not been updated 01.07.2020 will be deactivated starting 01.02.2022.

Respective IEC holders whose IEC got deactivated are allowed to update their IEC during this interim period until 31.01.2022; failing that, the IECs will be removed from 01.02.2022. In addition, any IEC that has received an online update application but is still awaiting approval by the DGFT RA[1] shall be removed from the deactivation list.

Note-The list of IECs may be seen at the given link (https://www.dgft.gov.in/CP/?opt=IECDL).

IECs so deactivated will have an automatic reactivation option without the need for manual intervention from the DGFT RA. In addition, the DGFT website can be used to update IECs online. After successful activation, the IEC will be activated once again and sent to Customs with the updated status.

Note- This is subject to the approval of the competent authorities.

How to avoid IEC Deactivation by DGFT?

All existing Importer Exporter Code holders should satisfy the below mentioned mandatory compliances-

  • Promptly, an electronically generated update of changes in the information provided for obtaining an IEC Code is performed between April and June of each year.
  • Even though the information provided has not changed, the IEC holder must verify electronically between April and June of each year to prevent it from being deactivated.
  • To steer clear of the deactivation of an IEC, the reaction to hazards listed in the DGFT portal against it must be controlled by the IEC holders within a specified period.
  • After revising or updating the information or getting a response to a query through the DGFT Portal, the deactivated IEC can be revived.

How to Update or Modify Importer Exporter Code

Following the notification, an IEC Holder must update the IEC each year from April to June, even if there’s no updation on the portal of the DGFT.

In case of non-failure of updation of details of IEC every year within the prescribed timeframe, IEC will be Deactivated.

Here is the list of types of updation/changes that an IEC holder can do on the DGFT portal-

  • In registered address. IN Branch address.
  • Mobile Number and Email ID.
  • Bank Details.
  • Directors/Partners.
  • Change in business nature.

Recent Amendments in New Import Export Code

As mentioned in the Policy, the Importer Exporter Code is required for export/import from/to India.

The DGFT issues IEC, and an application for issuance of an electronic IEC can be made promptly on the DGFT official Notification.

Additionally, IEC’s application process and upgrades are online, and the applicant can generate IEC following the IEC up-gradation process through the E-IEC portal.

Conclusion

Conclusively we can say that Import Export Code is required to start Import and Export from India. Without obtaining an Import and Export code, no importer and exporter are authorized to carry out the Import Export Business.

Read our Article:IEC Registration Renewal and Surrender: Underlying Norms

Priyanka Bajpayee

A Company Secretary together with PG in international Business, she has gained significant experience as legal content writer. She has keen interest in doing research and writing on legal and financial subject matters. She also holds work experience in legal compliances.

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