Import-Export Code (IEC) is a 10-digit identification number that is mandatory for all business entity that wants to do Import or export activities. Therefore, a person/entity shall not be eligible to make any import or export of goods if he does not possess a valid IEC Number.
However, for the import or export of services or technology, the IEC will only be necessary if the service or technology provider intends to avail benefits under the Foreign Trade Policy or engage with specified services or technologies. The Director General of Foreign Trade (DGFT) in India grants it.
Importers must quote the IEC when clearing customs; without quoting it, they are not allowed to proceed. Also, the banks demand the IEC of importers while sending money abroad. Exporters must quote the IEC while sending shipments, and banks require the exporter’s IEC Code when receiving money from abroad.
Further, exporters can’t take benefit of exports from DGFT, Customs Departments, and Export Promotion Council, if they don’t have this code.
After the introduction of the new system, the Import Export number is the same as the PAN of the entity or individual but it would be separately issued by DGFT. IEC registration is a completely online process and can be completed within 4-5 days, once issued it shall be valid for a lifetime.